Q&A: What’s the Best Way to Respond to Bad Reviews?

These chefs might seem to be reading their negative Yelp reviews for the first time, but anyone adept in the reputation management field knows how to gauge sentiments online.

We all know that such reviews have great influence, even though many are written by amateurs who may have had a few too many before deciding to bring down a business’s rating over one proverbial fly in the soup.

So what’s the best way to respond to these negative reviews? We spoke to Karan Chaudhry–CEO of “leading provider of instant feedback solutions for restaurants and retailers” DropThought–to learn more.

What are the most common negative reviews for different industries, and why do they come about?

The most common negative reviews tend to concern things like bad service and long wait times. The majority of negative mentions for most businesses on social media sites like Yelp and Trip Advisor are associated with immediately actionable business processes.

In general, these escalations arise due to a lack of oversight: a manager can’t be everywhere at once, and sometimes things slip through the cracks. What our studies have shown is that situations that result in negative reviews have a greater likelihood of being remedied when the right person is made aware.

How much do they really affect business and perception?

A lot. A one-star improvement in Yelp ratings translates to a 5-9 percent revenue increase, according to research conducted by Dr. Michael Luca, assistant professor of business administration at Harvard Business School.

What do you find to be the most common way of dealing with these reviews?

Frankly, using traditional methods for customer feedback, the majority of these issues don’t get addressed and businesses lose the customers.

The few negative reviews that make their way to the right business personnel through social media platforms are managed by businesses either directly or through an online reputation management service.

There are two glaring problems with this approach: first, many negative reviews do not reach the appropriate personnel, and secondly, lag time is an issue. Businesses must acknowledge their customers to inspire loyalty. When a customer invests time and effort to evaluate a business and does not receive a response, that’s a customer lost. If a response is sent weeks or even months after the fact, you can be sure that customer is taking their business elsewhere.  Likewise, online reputation management is a Band-Aid approach, not a permanent cure.

How, based on your experience, should businesses and the firms representing them approach the problem differently?

According to Professor Baba Shiv, Professor of Marketing at Stanford’s Graduate School of Business and Board Member of DropThought, “Research shows that customer emotions become permanent with time. It’s best for an effective intervention to take place as close to the experience as possible.”

If businesses are proactive in seeking out and acting on customers’ instant feedback in a timely manner, they will not only retain existing customers but also add new ones through positive word-of-mouth.

What’s the key strategy/tool for addressing such reviews quickly and effectively?

The key strategy to address negative reviews effectively is to build in instant feedback into the overall business strategy. No one hits the bulls-eye with the first arrow – acting quickly on customer feedback is essential to success. Waiting for a negative review to be posted on a social media site allows for the negativity to disseminate, which puts the business at a disadvantage with new customers.

Ideally, businesses will intervene before customers decide to post reviews on social media. This allows them to mitigate the negative experiences and amplify the positive ones in the minds of customers.

To what degree do companies need to engage with unsatisfied customers? What are the best forums (beyond Yelp) to use in doing so?

Depends on the nature of the complaint. In majority of the cases, an acknowledgement and a sincere apology goes a long way. In other cases, there might be some piece of information that needs to be made available to customers like, “Rush hour wait times at our premise typically range between 20-30 mins. Kindly make advance booking next time. We sincerely regret the inconvenience.”

Recently, Clover, a subsidiary of First Data, and DropThought announced their partnership to enable businesses of all sizes to get instant feedback from their customers either on the Point of Sale terminal or via email, text or print receipts.

Business owners and managers get instant alerts on customer issues through the DropThought Manager mobile app and can respond to customers directly from their phones. Businesses can also view customer feedback and trends in realtime from anywhere on their web dashboard. Clover and DropThought plan to offer businesses more value-added features like instant social media marketing and online reputation management in near future.

What sort of experiences do we have with reputation management services?