Do online consumer reviews really matter? Yes, but in ways that might surprise a lot of people.
A moderately worded four-star review, for instance, can sometimes be more persuasive than a five-star rave. People pay more attention to reviews written using mobile devices. And talking about previous purchasing mistakes makes a reviewer seem more trustworthy.
These are just some of the conclusions from recent academic research on consumer reviews. As more and more shoppers choose to block online advertisements and tune out companies’ messages, they are increasingly relying on reviews to help them make buying decisions—with a big impact on companies’ bottom lines. An increase of a single star in an overall rating on review site Yelp.com boosts a restaurant’s revenue by 5% to 9%, according to research by Michael Luca, an associate professor of business administration at Harvard Business School.
“If anyone doesn’t realize the value of online reviews and word-of-mouth, they are not understanding how to do business in a digital world,” says Lauren Grewal, assistant professor of marketing at Dartmouth College’s Tuck School of Business.
Here’s a closer look at what the latest research shows about what customers are looking for with online reviews, what makes them trust a particular review, and what makes them pull out the credit card and place an order.
