Gone are the days of consumers complaining to no avail. Thanks to the advent of the internet and social media, customer complaints no longer fall on deaf ears—quite the opposite, in fact. Nowadays, online reviews and their impact are amplified, reaching a vast audience. In this post, we explore how reviews affect the online reputation of hotels.
Just how powerful are online reviews?
Ratings and reviews have arguably become the single most important piece of information for customers. 95% of leisure travelers read reviews before booking their vacations. Moreover, 81% of travelers find online reviews to be very important when it comes to choosing a hotel, and 49% will not risk booking a hotel that has zero reviews. This tells us that reviews have a direct impact on a hotel’s revenue, and that review sites like TripAdvisor greatly influence consumer behavior and decisions.
According to a report by Street Fight, US marketing decision-makers believe that reputation and review management is very effective in customer retention. Other marketers look at review management as a way to increase lifetime customer value, raise brand awareness, increase conversion and sales, or to even acquire new customers.
Brand image on social media is also something that companies should be aware of. Monitoring brand mentions has become essential for brands that want to be proactive about their online reputation. What are my customers and potential customers saying about me on social media? What are some of the key themes that are emerging from the online conversations? Is there anything that we can proactively fix? What are we doing well? These are only some of the questions that can be answered by monitoring brand mentions on social media.
Responding to reviews
We’re starting to see brands respond to consumer comments and reviews publicly. This includes acknowledging concerns, sympathizing, apologizing, and offering solutions. Proactive engagement goes a long way in trying to rectify the situation.
A Harvard Business Review article highlights the importance of publicly responding to negative consumer reviews. Davide Proserpio, Assistant Professor of Marketing at University of Southern California Marshall School of Business, and Giorgos Zervas, Assistant Professor of Marketing at Boston University Questrom School of Business, wanted to test the hypothesis that replying to customer reviews results in better ratings. To do that, they examined tens of thousands of hotel reviews on TripAdvisor and their responses. They found that nearly one-third of reviews received a response.
However, here’s the more intriguing finding: they found that when hotels responded to reviews, they received 12% more reviews and their ratings increased by 0.12 stars on average. They also mentioned that, while it may not seem like a significant increase, it’s important to remember that TripAdvisor rounds average ratings to the nearest half star:
Responding to reviews is crucial. Professors Proserpio and Zervas also found that one-third of the hotels were able to increase their rounded ratings by half a star or more only six months after their first review response. This goes to show how impactful reputation management and responding to reviews can be.
At DAC, we understand the importance of reputation management. This is not something that brands can afford to ignore. It has become critical for companies to include a community management plan as part of their overall marketing and content strategy. We’ve helped our clients develop community management guidelines, which include response tips and templates that can be used to respond to consumer concerns in a timely and effective manner. Creating a social media playbook with governance guidelines has proved to be valuable.
Negative reviews are inevitable—it’s just a question of how they are managed.
Are you keeping close tabs on your online reviews?
Reviews, both positive and negative, are powerful. Negative reviews have the power to deter consumers from making a purchase; a negative review can drive away 40% of potential consumers. On the other hand, positive reviews have the power to increase a brand’s visibility, increase the likelihood of consumers making a (bigger) purchase, and increase business revenue.
Getting third-party verification will continue to be of paramount importance for consumers.
Want to know how to stay competitive in a world where ratings and reviews can make or break a business? Download our travel and hospitality white paper for more insights or get in touch with DAC today!