Ratings and reviews play a pivotal role in a consumer’s decision-making process and can often be the deciding factor in whether a customer purchases a product or service. In today’s episode of The Small Business Show, Shep Hyken, renowned customer experience expert and best-selling author, shares insights from his research, The State of Customer Service and CX, and reveals what customers want, need, and expect.
The impact of ratings and reviews
Eight out of ten customers (83%) said they sometimes look at reviews and ratings before purchasing. However, seven out of ten (69%) expressed skepticism about the authenticity of online reviews. This skepticism is particularly strong when reviews appear too perfect.
A study at Northwestern University found that most consumers feel more confident when reviews range from 4.2 to 4.7 on a scale of one to five. Reviews carry even more weight for products perceived as more expensive and riskier.
Hyken also emphasizes that the manner in which companies respond to negative reviews is just as impactful as the reviews themselves. When companies respond with empathy and a genuine effort to make things right, they instill more trust in potential customers who are weighing their purchasing decisions.
Trusted sources for product recommendation
Hyken’s research also uncovered the sources consumers trust most for product recommendations, ranked in order of impact:
- Family
- Friends
- Celebrity endorsements
- Social media influencers
- Online forums
- Review or ratings on a retailer’s website
- Reviews or ratings on a company or brand’s official website
The risks of fake reviews
There are significant risks associated with faking or incentivizing reviews. Some companies create fake reviews using bots. Even more concerning, some use bots to generate false negative reviews against competitors.
Hyken speculates that legislation will eventually be developed to curb the practice of fraudulent reviews. The issue contributes to the widespread skepticism surrounding online reviews, especially those with a perfect five-star rating.
The importance of personal branding
Hyken recommends that all individuals, business owners and employees alike, develop a personal branding strategy. Being recognized as an industry professional is crucial. He suggests creating and maintaining a LinkedIn profile with endorsements and experience and including it in a resume.
Use feedback to improve customer service
Customer feedback is a gift as it allows business owners to understand how their company is perceived. When receiving positive feedback, especially when a specific employee is praised, leaders should acknowledge and reinforce that behavior. Likewise, negative feedback should be addressed constructively, turning it into a teachable moment to strengthen the team.
Great examples of brands that consistently deliver excellent customer include Amazon, Walmart, Target, Apple, Chick-fil-A, Costco, Google, Verizon, AT&T, and Home Depot.
The role of AI in customer service
Artificial intelligence (AI) is here to stay, and it’s one of the easiest ways to elevate a business to a higher level in all avenues. Years ago, incorporating AI into daily business operations was costly. However, with AI becoming more affordable and accessible, businesses should integrate it into their customer experience strategy.
However, it’s crucial not to eliminate the human element of customer service. AI should be used to handle repetitive tasks, common customer inquiries, and frequently asked questions. Human representatives should be available to assist customers with more complex issues or questions.
By leveraging customer feedback, maintaining authenticity in reviews, and strategically implementing AI, businesses can build trust, enhance the customer experience, and keep them coming back repeatedly.
“My favorite philosopher, Arnold Schwarzenegger, said in his great movie The Terminator, ‘I’ll be back.’ And that’s what we want our customers to do.” – Shep Hyken
