Ignoring customer reviews isn’t just a missed opportunity; it can cost you sales. Studies show that responding to your reviews in the right way can boost ratings, increase conversions, and strengthen your reputation. Yet, most businesses either ignore reviews or respond incorrectly, inadvertently hurting their sales.
Researchers from USC and Boston University investigated whether replying to reviews actually impacts businesses. They focused on hotels on TripAdvisor, but the findings are applicable to any business that receives online reviews. Spoiler alert: responding to reviews does move the needle, but there’s a catch. It not only changes your ratings but also alters how customers review you, potentially increasing negative reviews. Stick around, as we’ll cover how to turn even negative reviews into a win for your business.
Reviews are Make or Break
Online reviews are far from mere noise; they can make or break a business. The researchers found that when hotels began responding to reviews, their TripAdvisor ratings increased by an average of 0.12 stars. While that may seem small, it’s significant on a five-star scale where most ratings hover between 3 and 4.5 stars. This seemingly minor boost led to 27% of hotels improving their ratings by half a star within six months. Furthermore, they received 12% more reviews overall. More reviews and higher ratings? That sounds like a no-brainer, right?
However, there’s a twist. Responding to reviews not only garners praise but also leads to fewer, yet longer, negative reviews. Customers who feel scrutinized may either skip venting or decide to elaborate on their grievances, providing detailed accounts of their experiences. This dual outcome raises an important question: is responding to reviews worth it for your business?
What the Research Reveals
To understand this, we need to look at how the researchers conducted their study. They compared hotels that responded on TripAdvisor with their ratings on Expedia, where responses are rare. Using a method called “difference in differences,” they tracked ratings before and after hotels initiated responses. They even analyzed if guests who stayed at the same time rated differently based on whether they reviewed before or after a hotel responded.
The result was a clear increase: a 0.12 star boost and a 12% rise in the volume of reviews. This method can work for any business, whether you’re in retail, dentistry, or food service. The driving factor here is psychology. When you reply, customers feel heard. This acknowledgment makes them more likely to leave feedback—especially positive feedback. However, for negative reviews, it raises the stakes. Customers know you might call them out, which can lead to elaborate critiques.
Understanding the Trade-offs
What does this mean for your business? If you have a plethora of vague complaints, responding could help clarify those issues. However, brace yourself for more detailed critiques. The good news? You’ll likely receive fewer negative reviews overall, and the ones you do get will be longer and more constructive. This makes it easier to address specific concerns, which is beneficial for both you and future customers.
For instance, if you manage to get that 0.12 star boost, your rating might improve from 4.1 to 4.2 stars. While that’s not a massive leap, it can make you stand out from competitors. Additionally, that 12% increase in reviews means more opportunities for positive feedback. If you have 100 reviews, that’s 12 more chances to showcase your strengths or defend against negative comments.
Implementing a Review Response Strategy
So, how do you make this work without screwing it up? The research doesn’t provide a perfect response template, but it does hint at effective strategies. Here’s a three-step plan to respond like a pro:
- Reply to Everything: Yes, you read that right. Respond to positive, negative, and neutral reviews at about the same rate—around 31%. Every reply shows you’re engaged. Thank a five-star fan to keep them coming back and tackle the one-star rants to demonstrate transparency. Start with your most visible platforms—Google, Yelp, TripAdvisor—and respond to every review, even the older ones.
- Stay Professional: Negative reviews can become more detailed when you respond, as customers feel watched. Avoid getting defensive. Acknowledge their issue calmly, like, “We’re sorry that your meal was cold,” or “We’re sorry that shipping was delayed.” Offer a fix, a discount, or a promise to improve. This approach cuts short baseless complaints and builds trust with future readers of those reviews.
- Test and Track: This is not about guesswork. Understand what works for your business. Pick a 30-day window to respond to all reviews and measure your results. Did your average rating climb? Are you getting more reviews? Are the negatives longer but less frequent? The study shows that noticeable results can take about six months, but you can test faster than that.
Dealing with Longer Negative Reviews
One downside to this approach is that negative reviews may become more detailed, turning a simple complaint into a lengthy account of dissatisfaction. While that can be daunting, remember that the research indicates fewer negative reviews overall. Customers either skip venting or pour their hearts out in essays. For your business, this means you can choose between cleaner ratings with occasional deep dives or a pile of unchecked gripes.
Every review is an opportunity. It’s a chance to build trust, recover a dissatisfied customer, or showcase why people love your business. Responding isn’t merely about damage control; it’s about creating a strong, customer-focused brand that people trust over competitors.
What To Do Next
Responding to reviews isn’t just a nice-to-have; it’s essential. If you’re looking for a proven way to turn reviews into more sales, don’t miss the chance to implement this strategy. Remember, the goal isn’t just to manage your reputation; it’s to build a brand that resonates with your customers.
For more insights, visit the CEO Workbench for free resources on scaling your business scientifically: CEO Workbench. Also check out my book, The Business Unlock, for which shows how to set up your business for AI-ready scale.
