How a Few Negative Online Reviews Early on Can Hurt a Restaurant
In an age of instant opinions, when comments go live the moment someone thinks them, it’s easy to help or hurt a business in the blink of an eye. Review platforms and social media have provided an open arena for consumers to immediately share their experience.
Restaurants are more impacted by these reviews than any other industry. Ratings about the quality of food, environment, service, and the amount of consumer reviews are associated with a restaurant’s online popularity. According to a survey, nearly half of consumers say online reviews are important when choosing a restaurant, and one-third say they won’t patronize a restaurant with less than a four-star rating.
A recent study found that just a few negative reviews online can determine early on how many reviews a restaurant receives long-term. The study titled “Restaurant Reviews and Neighborhood Effects” evaluated the reviews from Yelp and Tripadvisor of about 3,000 restaurants per website.
Researchers chose samples in Franklin County, Ohio, which is home to the headquarters of more than 20 restaurant chains. The food industry considers the preferences of consumers in the area to be a litmus test for the broader U.S. market according to a previous study. After collecting reviews for restaurants published in May 2019, the study analyzed data by rating and geographic location.
Demographics and socioeconomics of each neighborhood, based on household income, were taken into consideration. It was later found that restaurants with a smaller number of reviews on Yelp and TripAdvisor had higher likelihood of a low rating. The more reviews a restaurant had, the higher the average rating it received.
“But this has implications,” shared Kareem Usher, co-author of the study, “If one of the first reviews a restaurant receives comes from a dissatisfied customer, and people check that later and think ‘I don’t want to go there’ based on that one review, then there will be fewer reviews of that restaurant.”
On the other hand, more people are likely to comment on restaurants that receive positive reviews or have a large number of reviews, improving the likelihood that a restaurant’s average rating will be higher. Data shows that 17.6 percent of restaurants with only one to four reviews received a low rating on Yelp. It decreased to 9.3 percent for those with between five and 10 reviews.
On Tripadvisor, restaurants with one to four reviews had a 5.6 percent probability of receiving a poor review. This goes down to 0.6 percent if the restaurant has five to 10 reviews. Researchers also noted that restaurants located in several of the poorest neighborhoods in Franklin County are not rated on the sites.
Lead author, Yasuyuki Motoyama, explained “The way these platforms work, popular restaurants get even more popular, and restaurants with some initial low ratings can stagnate.” He went on to suggest that, perhaps, Yelp and Tripadvisor can set up policies that might be more fair.
“Maybe these online platforms can withhold reviews until a restaurant gets a certain number of reviews — say, 10 or more,” he shared. “That way if there are two or three customers who are very dissatisfied with a particular experience, they are not directing the restaurant’s success or failure.”
Restaurateurs need to be mindful that online reviews are often trusted by customers and have become a standard part of the journey to purchase. What happens when a restaurant receives a negative online review? Four or more negative reviews could drive away up to 70% of potential customers and could cost you up to 30 customers.
The message came through loud and clear, online review sites can have significant effects on a restaurant’s success or failure. They are a necessary part of managing your restaurant, and you need to learn how to deal with them quickly. What you need is a strategy and the best tools to request positive reviews from customers, and to spot negative reviews to turn them into positive opportunities, fast.