Every business owner knows how important it is to build their reputation and that the best form of marketing for their business and the best way to get hot leads is via the social proof of word of mouth recommendation.
But the over the past year or so the findings of a study called the ‘Local Consumer Review Survey’ showed a powerfully positive shift in the trust and appreciation of online reviews.
Myles Anderson of Search Engine Land said that:
Approximately 72% of consumers surveyed said that they trust online reviews as much as personal recommendations, while 52% said that positive online reviews make them more likely to use a local business.
Are Online Reviews Trustworthy?
Now stop and think about this for a while. 72% of consumers said that they TRUST online reviews as much as personal recommendations and this is a growing trend. So it appears consumers are finding the online reviews trustworthy enough to base their buying decisions upon.
It really begs the question of you as a business owner and entrepreneur – do you have a system in place to encourage your customers and clients to post positive online reviews about your business, your services and their experiences in using your services?
If not you may be leaving a lot of potential custom on the table for your competitors to steal away from you, but we can come back to this in a moment.
First let us get back to this study to understand it a little better.
Online Reviews Statistics from the Local Consumer Review Survey
This survey was carried out online between 15th January – 1st March 2012. 18 questions were put to 4,500 local consumers located in US, Canada and UK. There were 2,862 respondents. This was the second wave of this survey.
It was firstly conducted in late 2010/early 2011 just in the UK and US. So the fact that this particular survey has been carried out twice at two different date points it may be useful to see if there has been any change in consumer attitudes and behaviour.
The following results and charts are taken from Part 1 of the survey – thanks to Myles Anderson.
Part 1: Consumer Attitudes & Consumption Of Online Reviews
Q1: How many times have you used the Internet to find a local business in the last 12 months?
There has been a significant jump in the number of consumers using the Internet to find local businesses, and the regularity of their ‘searches’ has also increased.
- Only 15% of consumers said that they had not used the Internet t0 find a local business (vs. 21% in 2010)
- 16% of consumers said they used the Internet every week to find local businesses (vs. 9% in 2010)
As you can see in the ‘never’ section there has been a sharp drop in the percentage of people that have never used the internet to find local businesses and a sharp increase of the people using the internet every week to find local businesses.
But those that use the internet everyday has only increased slightly. This must be a core of a certain category of people that use it everyday. Where as the majority that have not been using it so frequently has obviously had a degree of behaviour change from 2010 to 2012 following a trend of increasing internet usage for finding local businesses.
Q2: Do you read online customer reviews to determine whether a local business is a good business?
More consumers are reading online reviews now than 15 months ago, with 27% regularly reading online reviews when looking for a local business to use.
- 27% of consumers regularly use online reviews to determine which local business to use (vs. 22% in 2010)
- 24% of consumers never use online reviews. (vs. 29% in 2010)
As you can see from the charts above there has been an increase in the percentage of people regularly reading online reviews of local businesses.
Q3: How many online reviews & ratings do you need to read before you feel that you can trust that business?
This year’s survey shows a decline in the number of reviews being read by consumers. Consumers are forming opinions faster and trusting reviews more, leading to lower consumption of reviews.
- 65% of consumers read between 2-10 reviews (vs.58% in 2010)
- Just 7% of consumers read more than 20 reviews (vs. 12% in 2010)
Note: the total quantity of reviews a business has remains important. Having a high number of reviews gives users more confidence in star ratings (represent an avg. across all reviews) and allow users to feel more confident in the fewer reviews which they do actually read.
From the chart above as the survey report suggests, confidence in online reviews appears to be growing with an increase in the percentage of people that will read between 2 – 10 reviews on a local business, but a drop in the number of people that will read more than 10 online reviews.
Q4: How do online customer reviews affect your opinion of a local business?
More consumers are reading online reviews and using them to form an opinion about local businesses. Positive reviews can establish greater trust in a local business.
- 58% of consumers trust a business which has positive online reviews (vs. 55% in 2010)
From the chart of responses to this question there has been a drop in the percentage of people that take no notice of online customer reviews to a degree of an increase in those that read the reviews and take notice of them in trusting a local business.
Q5: How do online customer reviews influence your decision to use/select a local business?
More local consumers are now taking notice of online reviews and online reviews are an important factor in deciding which local business to use. Consumers appear to be swayed by location and price which don’t represent any guarantee of quality or reliability.
- 52% of consumers are more likely to use a local business if they have positive reviews
- Just 28% of consumers cite location &/or price as main decision making factor (vs. 28% in 2010)
With question 5 it appears there is a drop in the percentage of people that are swayed in their deciding on a local business due to price or location factors and an increase of people reading reviews and slight increase to 52% (more than half) of consumers that are choosing local businesses because of positive online customer reviews.
Q6: Do you trust online customer reviews as much as personal recommendations?
Appreciation and value of online reviews is growing as more consumers trust online reviews as much as personal recommendations.
- 72% of consumers trust online reviews as much as personal recommendations
It is a big question – “Do you trust online reviews as much as personal recommendations”… 28% of people surveyed said ‘No’. But that means 72% of people trust online reviews as much as personal recommendations.
This is an increase from 67% in 2010. Now you may say the shift is not a massive shift from 2010 to 2012 of people trusting in online reviews so much, but it is an increase of 9% over that period of time so this would imply that potentially by 2014 almost 80% of consumers will be trusting in online reviews as much as personal recommendations.
Online Reviews for Services
From a little online research there is a growing number of searches for local online reviews, online reviews restaurants, online reviews of colleges, online reviews plumbers, online review yelp, online reviews for hotels just to name a few.
So as a local business that wants to grow and make the most of this foundational aspect of business building there are a few things that can help you in growing your business in a systemised way.
- Get yourself registered on many of the review websites as possible. These types of sites include Yelp, Yell, Google Plus, there are many more.
- Get yourself an app added to your website for collecting reviews and positive reviews from clients and customers with ease.
- Build into your sales and deliver processes a way to encourage customers to post their reviews about your services.
People are actively searching for reviews BEFORE choosing a local business, such as a plumber, hotel, restaurant, college, dentist, car dealer, security company etc… The sooner you build this into your marketing processes the more established you will be compared to your competition, making you the obvious choice!
With the continuing growth in the use of smart phones and people accessing the internet via their phones and mobile devices means that even more consumers will be searching for local businesses, plumbers, security companies, hotels, restaurants, double glazing companies etc online.
The availability of clear and easy to consume review/star-rating content will become even more important to consumers and extremely valuable to local business owners and businesses.
If you would like a downloadable guide for doing this simply and easily post a comment and request below, even find out how you can use your online reviews in your advertising for maximum benefit.