How negative online reviews impact local businesses

The Effect of Negative Online Reviews for Local Businesses

The statistics prove how important it is to have good online reviews. With 91% of consumers regularly reading online reviews, 60% say that negative reviews make them not want to engage with a company. When it comes to local businesses, like hotels and restaurants, 21 percent of consumers say Google Reviews are one of the most important platforms.

Over a third of searches have local purpose

What Is Local Search?

Local search is the use of online search engines where people can submit geographically constrained searches against a database of local business listings. These results are based on ranking factors different than other organic results.

Most local searchers aren’t querying for general company info. They are interested in two types of information:

  • Listing information: this includes phone number, store hours, busy times, menus, etc.
  • Reputation data: this includes star rating, reviews, etc.

How people search for local businesses.

57% : mobile + tablet
42% : desktop

89% : internet browser
11% : map-based app, such as google maps

What is searched for:
24% check profile images
21% read Google Reviews
21% values the ranking within the search engine
Local searches considered these three elements as “most important”.

How many people search for reviews.

91% of consumers regularly or occasionally check online reviews.
63% of people utilize a search engine to find online reviews.
37% of people visit a review website directly to find online reviews.

How reviews are valued

74% of people have more trust in a local business when positive reviews are found.
60% will not engage with a company when negative reviews are found.
A small 5% don’t pay attention in reviews.

90% of people look at 10 reviews or less before trusting a business.
68% of consumers develop an opinion by going through just 1-6 reviews.

Consumers are willing to pay 31% more on products and services from companies with many positive reviews.
84% of people trust online reviews as much as a personal referral.
Business lose 22% of customers when just a single negative review is discovered prior to buying.
It also turns out that people are hesitant to purchase from businesses with no reviews or with too many negative reviews.

The impact of Yelp reviews.

If you have negative reviews on Yelp and want to turn the low star ranking to a high star ranking, it gets a bit more tricky. When a business listing gets too many reviews in a short period, the Yelp filter identifies that as being suspicious activity. As a result, the filter may hide some or all of those reviews. So request reviews progressively, a few customers at a time.

The value of Facebook reviews.

Your Facebook company page is another good source for reviews. Of consumers, 47% recommended a local business to people through Facebook. Because Facebook is expanding so fast, and there is a lot of engagement, obtaining reviews on Facebook can help to reach locals with good publicity about your business.

Too many negative reviews?

If you are losing customers because prospective customers are turned off after reading negative reviews online, ask your happy customers to post a review. Research shows that 50% of consumers that are asked to leave a review about a company, product or service, will happily write a review.

When you ask, make it as easy as possible for your customers by providing a link that goes directly to a review website or social media channel.


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