“Only giving 4 stars cause there’s just way too much food to choose from.” “Bitter coffee with a bitter environment.” “The pizza gave me cancer.”
Yelp reviews are the bane of every restaurant owner, and thanks to the ease and range of the internet, no industry is safe from caustic customers.
Business owners might think they have only two options: ignore them or confront them on their turf. Jason Greenberg, PhD ’09, offers another option: assuage and engage.
After a decade of studying restaurant reviews in New York City — a notoriously tough market — Greenberg concluded that Yelp’s expansion into the market didn’t increase sales inequalities among restaurants — a relief for places that don’t have a celebrity name or thousands of reviews behind them.
What’s more, Greenberg observed in his study, “The (Internet) Information Inequality Machine?,” restaurants can use Yelp’s combination of “crowd and experts” to build a sense of quality around their product.
“For the savvy business owner in areas that are not traditionally covered by these rating services, it gives you a really interesting opportunity,” Greenberg said. “The question really becomes where wouldn't this apply?”
He offered these tips for getting the most out of online reviews, regardless of industry.
Distinguish your offering and find your niche
While some corporate titans can make it seem like the internet age is a winner-take-all market (think Amazon, Facebook, and Google, which dominate their respective markets), Greenberg found there is still room for multiple players.
Companies of any size can succeed by serving the “information impoverished tourists” in their markets. These “tourists” can be literal — a visitor who lacks knowledge about the Manhattan restaurant scene — or theoretical — an online shopper unsure of what brand of shoe they want to buy.
“When you don’t know if you like this pair of Nikes or Adidas, you’re going to resort to the ratings for information,” Greenberg said. “Think about the sorts of areas where your clientele is going to be information impoverished, and they're going to give a lot of weight to online reviews.”
A new market entrant should cultivate those early reviews, Greenberg said. Be thoughtful, engage with the community, think about different ways of providing information about your product or service. And don’t try to fake a positive rating with the help of a family member or close friend: “People are pretty smart.”
At the same time you’re sharing information, find the right niche for what you’re offering. Consider New York City’s countless pizza options. When you ask Greenberg (who lives there) for a recommendation, he’ll ask you a dozen questions to narrow down his best suggestion. Do you like a spicy or sweet sauce? What about crust style? Does ambiance matter to you?
“I often find it takes a long time to find precisely what I'm looking for, because there are so many different options,” Greenberg said. “That’s what customers demand and that provides the entrepreneur an enormous opportunity — to find this niche that is different enough they can find a customer base.”
It can be hard to enter a new market or try to make a dent in one you’re already in (especially against competitors with a large number of reviews). But a little effort can go a long way, Greenberg said.
“Build goodwill,” Greenberg said. “It’s how you touch the customer in some sense. What are you giving the customer? What are you making them feel about the experience? A lot of it’s about little details around engaging and interacting with customers.”
Greenberg offered a personal example. While heading to a ski trip in Utah several years ago, he got a call from the hotel concierge, asking what he’d like for dinner. Despite his late arrival, the kitchen stayed open so that he wouldn’t go hungry in a small town with limited options.
“To this day it’s the only review I’ve ever written,” Greenberg said. “To the extent to which this particular hotel would go, to essentially generate positive customer experience — it was a very authentic review. The last time I checked, lots of people have looked at it and found it useful, as well they should, because I think it’s a representation of how the hotel and management care about its customers.”
Learn and adapt from reviews
In Greenberg’s interviews with restaurant owners, he learned that some of them took customer feedback so seriously, they started their weekly staff meetings by discussing the latest reviews.
These owners also stressed to him the importance of reaching out to unhappy customers who wrote particularly bad reviews.
“Firms that do not have this social savvy and relational management capabilities are likely at a competitive disadvantage,” Greenberg writes.
In the end, both a business and customer can benefit from a detailed review. Even with Yelp’s long list of filters, information about a restaurant (size, noise level, dress attire) can be limited, Greenberg said.
“I want to hear from a parent who has a loud 2-year-old that this is actually a place where I can bring my loud 2-year-old,” Greenberg said. “Because I don't want to feel like I'm ruining other people's experiences, let alone a romantic date or a business meeting. And those are the opportunities for the entrepreneurs.”