How Do Positive Online Reviews Affect Your Bottom Line?

There are immeasurable benefits to a solid online reputation. According to a study by BigCommerce, 68% of customers are influenced by trustworthy reviews, while 92% read online reviews before buying. [Source: How to Use Customer Testimonials to Generate 62% More Revenue]

Unsurprisingly, reviews are one of the main factors when making purchase decisions. According to the same study, reviews are even more important than family and friends’ recommendations. Sounds crazy? Let’s take a step back.

According to a study performed in 2012, 70% of people trust reviews and recommendations from strangers. The study goes back over ten years ago; it is crucial to remember that the percentage is likely much higher now. [Source: 30 Testimonial Statistics You Should Know]

Where is the proof?

There is countless evidence that positive reviews increase conversion rates and sales. In other words, positive online reviews can translate directly into dollars for your business.

Here are two real case studies:

• Harvard Business School study: One-Star Bump On Yelp Leads To Big Revenue Boost, Study Finds – A “simple” rating change of 3 stars increased sales by over 20%.
• University of California, Berkeley study: Here’s Proof That Yelp Rating Can Make Or Break A Retailer – Gaining an extra half a star was enough for this restaurant to reach capacity at peak dining times.

On top of building customer trust and improving the online reputation of a business, positive reviews can positively influence rankings on search engines. In other words, they can help you climb results listings and reach the first page on Google. [Source: Local SEO ranking factors]

The more positive reviews, the better.

It’s known that the first five positive reviews make the most significant impact on increasing the conversion rate. However, there is no magic number. According to Reevo, the benefits keep growing as the amount of reviews increases. This data is based on one million product page visits. [Source: The impact of customer reviews and ratings on conversion rates]

It does not stop here. Going from 25 reviews to 50 reviews further raises the conversation rate by 18%, which could equal thousands of extra sales. With these drastic improvements at stake, companies should put positive reviews at the core of their marketing strategy.

Success is not solely reliant on quantity.

The quality of reviews plays a significant role in the consumer’s decision. This is why one single negative review can be a deal-breaker, or one single positive review can convert a visitor into a customer.

Focusing on the quality of the reviews is just as important as focusing on the quantity. Ideally, there should be a constant flow of (positive) organic reviews that explain to new visitors why your products are worth purchasing. Sadly, that is not always the case.

When you do not get enough reviews or are stuck with negative reviews, you limit your reach and potential.

Negative reviews matter, too.

Not many know that even negative reviews may have a positive impact because they establish authenticity and credibility. A business could induce positive feelings from negative reviews by replying and providing an explanation or solution.

After studying more than 3,000 consumers through 6 studies and four additional experiments, the researchers at “Journal of Marketing” discovered that negative reviews may actually help a business. [Source: Study proves why negative reviews are good for business]

Other useful statistics

• On average, the purchase likelihood for a product with 5-star reviews is over 270% greater than that of a product with no reviews. [Source: How Online Reviews Influence Sales]
• On average, 82% of consumers read online reviews before purchasing when searching for a local business. [Source: Impact of Reviews and Ratings on Search Click-Through Rates]
• Going from three stars to a five-star rating can make a business earn 25% more website clicks on average. [Source: How Online Reviews Influence Sales]
• For Google Near Me local searches, a star rating of only 0.1 can increase a business’s conversion rates by 25%. [Source: Small Increase in Online Star Ratings Boosts Conversion by 25%]
• Companies with less than three stars displayed on their Google business listing had fewer clicks than companies with no stars. [Source: How Online Reviews Influence Sales]

TL;DR

Positive reviews can help a business gain more trust, visits and customers. The benefits and statistics have constantly been rising for the past 20 years.

Source: What are the benefits of positive reviews?