free strategy session

Why Reputation Management Matters for Small Businesses

Date published: April 24, 2018
Last updated: April 24, 2018

Traditionally, when an entrepreneur started a venture, referrals were the most important source of business. People used to trust a business because someone recommended it. Hence, word of mouth marketing was essential for a company. Things haven’t changed a lot over the years; word of mouth marketing still holds its place as it drives $6 trillion of annual consumer spending and accounts for 13% of consumer sales. Also, word of mouth marketing results in 5 times more sales than paid media sales.

Although the importance of word of mouth marketing has never faded, it has evolved mainly due to the penetration of internet. A few years ago, companies used to sell their products to a passive audience without much interaction. However, the internet has opened two-way communication. Today, customers have a voice and the power to make or break a brand.

People don’t tell about a brand to friends and friends of friends; they just post it online where it reaches hundreds of people at once. Hence, we can easily say that word of mouth marketing has become more dangerous than before because word spreads like fire in the present era of the internet.

This drastic change in the entire marketing landscape has given rise to online reputation management. Online reputation entails improving your brand image and defeating any negative opinion with more positive views. Often online reputation management is confused with social media monitoring. However, online reputation management is much more than that; it is about taking feedback whether negative or positive and responding to it in a way that it does not damage your brand image. Dealing with negative reviews with care is critical, and companies that fail to do so might suffer from loss of sales and tinted brand image.

The interesting example of Dark Horse Café is quite relevant here. A customer complained about the shortage of electrical outlets in the café to which the company replied, “We are in the coffee business, not the office business. We have plenty of outlets to do what we need.” A lot of blogs labeled the café’s response as a negative public relations case.

Good reputation management also involves deciding whether to react at all. Sometimes if you don’t have a serious problem, then there is no need for a reaction. Often a delayed reaction can cost you a lot too. Negative reviews can be divided into two types based on their intensity. The first category includes complaints on social networks, and they usually don’t pose a real threat. The second category is more dangerous and can affect a business reputation in the long term. This category includes negative reviews, hate sites, and negative media coverage.

The infamous incident of United Airlines can be classified under the second category. Dave Caroll, a musician from Halifax, was traveling on the airline and baggage handlers severely damaged his guitar. When the company failed to compensate the singer for his loss, Dave took the matter to the public. He composed a song ‘United breaks guitars,’ which has more than 18 million views to date. The mishap cost the company 10% of its market capitalization, which is around $180 million.

These incidents show how powerful customers are and how they can leverage the digital media to put across their grievances. These events highlight the importance of managing reputation and relationship with customers. Here is how online reputation impacts a business:

1. Sales

According to a survey, 92% of consumers read online reviews before making a purchase and 40% of consumers make an opinion by reading just one to three reviews. The survey also showed that star rating is the number one factor in judging a business.

Research also shows that consumers are likely to spend 31% more on a product or service that has excellent reviews while a negative review can drive away 22% of customers. Conclusively, the statistics point to only one necessary thing, and that is the fact that your online reputation can make or break your product or service by directly impacting your bottom line.

2. Search Rankings

Reviews also have an impact on your search engine ranking. Research conducted by YOTPO voice tracked 30,000 online businesses for 9 months and found that the organic traffic to these sites started increasing after they added reviews. Google ranking algorithm values fresh and unique content and reviews are an excellent source for that content.

Reviews boost SEO without you putting in any effort because they provide links and long-tail keywords. Moreover, automated search engines use spiders that search for customer reviews and testimonials to evaluate a site. Plus, there are teams of search quality raters that manually judge thousands of sites for their authority and expertise, earned through good customer content. User-generated content increases a site’s legitimacy and helps it gain SEO juice from rating systems.

Managing online reputation takes time and effort. A company needs to proactively monitor the digital space, respond to customers, and acquire more positive reviews. Here is how a small company can manage its online reputation:

3. Monitor

Customers are continually talking about your business on various platforms. The question however is, are you listening? The first step in reputation management is listening to what customers are saying. You need to see your business through the eyes of your customer.

Keeping a vigilant eye on what is being said can be a difficult task, especially if you have a presence on various platforms. However, it is also problematic for small businesses since they have limited marketing budget and human resource.

However, considering the stakes that are involved, it is crucial for every business owner to know what is being said about the company because potential customers are regularly basing their purchase decisions on the feedback.

To start off, you can do a quick search for your business and see what comes up. What is the first impression that you get? You can also monitor by turning on alerts on review sites and through automated tools. No matter which way you choose, make sure that you do monitor because you wouldn’t want a negative review hanging in there.

4. Respond

Once you have started monitoring, you need to deal with the tricky part, which is to manage the reviews. There is nothing to panic about negative reviews. In fact, they show that your company is authentic. Research even shows that 52% of the buyers trust a product more if it has a few negative reviews.

One of the common mistakes businesses do is covering up or deleting a negative review. Running from a negative review is never the solution. Customers appreciate transparency and responding to criticisms shows that you care about them.  In fact, it is an opportunity for you to convert this customer into an advocate.

When responding to customer reviews, timing matters a lot. Customers expect companies to be prompt in replying because this shows that the company genuinely wants to help its customers. You need to get into the conversation early to prevent it from flaring up. Most importantly, understanding reviews will also tell you how to improve your business so that customers don’t have an issue in the first place.

5. Get more Reviews

To get more reviews is a difficult task. In an ideal situation, all your happy customers would be singing your praises online. However, it isn’t always the case. Satisfied customers often forget or don’t feel like the need to review a business even if it deserves it. Hence, it is crucial for a company to remind and guide customers through the review process. First, brands need to earn the reviews by providing excellent service and product. Once, customers have formed a bond with the brand a timely request will make it easier to acquire more positive reviews.

Once you have acquired reviews, these reviews can help you target more customers. How you do that depends on your marketing strategy. If you have a website, you can post reviews there for the visitors to see. You can also post them on your social media accounts. No matter how you use them, the point is that you need to leverage your reviews.

Managing reviews can be a hurdle because it is time-consuming. However, thanks to a plethora of tools in the market, you can automate the task. Some popular tools include the Brand Grader, which gives you a quick overview of your brand’s presence. It shows the most significant influencers of your brand, sources of the mentions, and sentiments regarding your brand. Although this tool is not as comprehensive as others, it is perfect for a quick review and the best part is that it is free.

Some social media monitoring tools that small businesses can use include TweetReach, which shows you the impact of your tweets and allows you to find the most influential followers so that you can target them accordingly.

Mention is another useful tool that companies use to track their online reputation. Mention allows you to monitor online conversations across major social media platforms, forums, news, and review sites. Since a lot of discussions happen at once, it is easy to get overwhelmed with the results. However, Mention’s Boolean alerts make sure that you only get the results that matter. is another tool that brings all your reviews in one place. It continuously goes through review sites and alerts you when a customer leaves a review.

Privacy PolicyCookie Policy
linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram