The Importance of Online Reviews for Small & Medium Businesses

Last updated: April, 2022

Did you know that 93% of your future customers will decide if they want to contact you based on the online customer reviews they find of your business?

Another 73% won’t even consider hiring you unless they read a review of your company.

In an increasingly competitive landscape, any advantage you can get over your competitors is more than welcome. That is why having online customer reviews will continue to be a gamechanger for many small businesses like yours in the long run.

Below, we will look at the ways online reviews can impact your local business in direct and measurable ways.

Why Online Reviews Matter for Local Businesses and SEO

In simple terms, the little stars that show up on your Google Business Profile Knowledge Panel as a result of the reviews your business has received can directly impact what people think about your company and what purchasing decisions they will make regarding your products and services.

According to Whitespark’s Local Search Ranking Factors of 2021 report, online reviews can influence both Local Finder and Google Local Pack rankings, in addition to local organic rankings.

In other words, while reviews might not be the most influential factor for your organic rankings, they are very important if you want to rank in the Local Pack, especially after Google cut the number of primary pack listings to three.

What is more, the Google Business Profile Help Guide also states that the “Google review count and review score both factor into local search ranking.” Reviews can also help you stand out because of Review Snippets that allow you to highlight your customers’ feedback if your business has Place Topics. You can’t manage those because they are automatically created based on your reviews and Google’s algorithm.

The Benefits of Online Customer Reviews for Your Small and Medium-Sized Businesses

1. Free Advertising

If you had the chance to enjoy some type of free advertising, wouldn’t you take it? That’s precisely what online reviews are to your business. Each review posted online about your product or service is a way of getting more readers to know about your company and what you do. Despite how efficient some marketing channels may be, online reviews are still one of the most effective ways to get your business in front of interested customers. People researching local service providers may not see your Facebook ad or find your website on the first page of Google, but they will indeed look for the company with the most online reviews.

2. You Will Show Up Higher in Search Results

Although online reviews are not a direct ranking factor, they can indirectly improve your search engine rankings. Google constantly looks for citations (a.k.a., where and how many times your business is mentioned on the web) and rewards companies that users are talking a lot about online. If people often mention you in their reviews, you are more likely to appear higher in search results.

3. They Make You Look Trustworthy

According to BrightLocal, about 91% of people aged between 18 and 34 trusts the online reviews they read as much as they trust peer recommendations. What this means for your SMB is that the more online reviews your company has, the more trustworthy you appear in the eyes of prospective customers.

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4. Reviews Can Offer Service Improvements

Not all online reviews were created equal. While some may praise you and others may offer criticism, some can provide insights as to how you can improve your service. Listening to your customers’ feedback can immensely enhance your offering and thus bring more leads your way.

5. They Have a Clear Impact on Your Sales

There’s tons of research and empirical data that prove online reviews can significantly increase your revenue. Research by Womply shows that:

If a small business has more than nine recent reviews, it earns 52% more revenue than its average sales. If a company has more than 25 recent reviews, that number increases to 108%.

Why You Should Always Respond to Online Reviews

It’s not enough to have online reviews and do nothing about them. It pays a lot to respond to them and engage with customers online. In terms of figures, this is exactly how much ROI you can expect in exchange for your effort to manage your online reviews.

  • When a business replies to at least 25% of their online customer reviews, they earn 35% more revenue. (Womply)
  • When writing a review, 20% of consumers expect to receive a response within one day and only 39 would be happy to wait for more than three days. (BrightLocal)
  • People spend around 49% more money at businesses that respond to their customer reviews. (Womply)
  • 41% of customers say that when brands reply to their online reviews, it makes them feel the company really cares about their customers. (Bazaarvoice)

Responding to online reviews promptly matters beyond the economic benefit of it. It also shows your customers that you value their feedback and care about their positive experience with your company. It allows you to get first-hand insight into what is good about your service and what needs to be improved.

Plus, it enables you to manage negative reviews and get customers on your side instead of ignoring them. When Nestle did that, it made everyone talk about their lack of interest in their customers.

Don’t be like Nestle, be better.

At 411 locals, we help businesses manage and increase their online reviews by offering a quick and easy review management service. You can track and respond to your online reviews even when you’re asleep.


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