How to Manage Reviews for Better Small Business Profit

You know that online reviews of your retail business matter. But did you know the businesses that do best at managing their online reviews actually earn more money? That’s part of the findings of an in-depth study by Womply that analyzed more than 38,000 retail businesses nationwide.

How to Manage Reviews for Your Retail Business

Keep reading to find out how to use online reviews to increase sales for your retail business’s revenues.

Tip 1: Get More Listings

It’s easy and free to claim your listings on online review sites, so why not do it? Local businesses that claim their listings on three or more review sites earn 21% more revenue than the average business, Womply found. Conversely, retailers that don’t claim their listing on any review sites earn 22% less revenue than the average business. That’s a lot of money to lose for just skipping such a simple step.

Start by claiming your listings on Google, Yelp, and Facebook — the most important review sites. (If you do only one, start with Google, since these ratings show up in your Google search results.) Retailers who claim their listings on just those three sites average $56,000 more in sales per year than those who claim none of their listings.

Tip 2: Respond to Your Reviews

A whopping 75% of retailers never respond to their reviews. While this doesn’t negatively affect their profits too much (they earn 6% less than the average business), responding to reviews can have a more substantial positive effect. Retailers that respond to reviews –even just semi-regularly — earn 19% more in annual revenues.

Set up alerts when you get a new review so you can respond quickly. It’s especially important to respond to negative reviews fast, as it shows you’re paying attention to what your customers are saying. Be sure not to get defensive: Apologize for the issue and ask if you can contact the customer (offline) to discuss it. Once you’re rectified the problem, see if the reviewer is willing to update their review. This helps show other prospective customers that you’re providing good customer service.

Avoid posting a generic, template response to each positive review. Varying your wording a bit makes it sound like there’s a real person reading the reviews.

Tip 3: Get More Reviews

More reviews correlates to more revenue, Womply found. The average number of reviews for a local retailer is 43. Local retail businesses with more than 43 reviews bring in 26% more in annual revenue than the average retailer.

If you don’t have 43 reviews yet, focus on achieving that figure — and then keep going! Retailers with more than 200 reviews earn 46% more than the average, so there’s a lot of benefit in growing your review base. To get more reviews:

• Put signage in your store reminding customers to review you. You can download free window clings and other marketing tools on Yelp.
• Put links to your review listings on the home page of your website, along with language encouraging customers to write a review.
• Include requests to review your business in your marketing emails or other emails to customers.

Check out Google’s tips on how to get more Google reviews.

Tip 4: Keep Those Reviews Coming

Having 200 reviews won’t help you that much if they’re all from two years ago. “Fresh” reviews are essential to keep customers coming in to your store. Womply defines “fresh” reviews as those posted in the last 90 days; the average retail store has five fresh reviews at any given time.

Once again, being above average will get you above-average sales. Retailers with more than five fresh reviews earn 28% more in annual revenue than the average retailer, the study found, while retailers with 20 or more fresh reviews earn 40% more. In contrast, businesses that have no fresh reviews earn 13% less than average.

To keep those fresh reviews coming, keep doing what you’re doing in Tip 3 to get more reviews.

Tip 5: Aim for Realistic Reviews

You might be surprised, as I was, to learn that retailers with 5-star ratings actually have below-average sales. They even earn less than shops with a 1 to 1.5-star rating. Perhaps customers don’t believe the 5-star reviews can be honest? Whatever the reason, the sweet spot for reviews is 3.5 to 4.5 stars. Retail businesses whose ratings are in this range earn revenues 13% more than the average retailer.

You can’t control the star ratings you get, but if too many reviewers are raving about your business, working to get more reviews should help even things out.

Now that you know online reviews can actually make your store more money, are you more motivated to manage them?

Not a retailer? Check out Womply’s findings on how online reviews impact small businesses in all industries.

Image: Depositphotos.com

This article, "How to Manage Reviews for Better Small Business Profit" was first published on Small Business Trends