5 Reasons Why Your Business Needs Negative Reviews

All business owners cringe at the sight of a one- or two-star review shown publicly on any review site.

The immediate feeling is often disbelief, anger, and resentment toward both the customer and the review site. There is almost nothing that makes business owners more emotional than public criticism of their work.

But emotions aside, negative reviews can actually be a good thing. Here are five ways they can help your business thrive.

1. They improve conversion rates.
On SiteJabber, businesses with 10-30 percent negative reviews actually receive more than 10 times more leads than businesses with nearly all five-star reviews. Other studies have shown that 68 percent of consumers trust reviews more when they see both good and bad reviews.

This is true partly because many consumers want to understand “worst-case scenarios” before doing business with a new company. If they feel that they can live with the worst-case scenario, they may decide your company is one they want to work with.

Perhaps ironically, if potential customers cannot find any information on “worst-case scenarios,” their imaginations may run wild, leading them to decide your business is too risky to engage with.

2. They instill trust.
It may seem counterintuitive that reading bad reviews can make a consumer trust a company more, but we live in an age where fake “social proof” is everywhere. Nowadays, anyone can buy thousands of Facebook likes or Twitter followers for a few dollars.

Savvy consumers understand that reviews also can be fake, so when they see a business with 100 perfect five-star reviews and no bad reviews, they tend to believe all the positive reviews are fakes, even if they are real.

Customers are smart: They know that all businesses, even the best ones, have at least some unhappy customers. So as long as negative reviews are seen alongside good reviews, they can humanize your business and reassure consumers that the rest of your reviews are legitimate.

3. They highlight brilliant customer service (if you respond to them publicly).
Consumers trust brands that have great customer service. Nordstrom is a great example of this.

However, smaller companies often find it challenging to show that they, too, strive to provide the best customer service possible. Responding quickly and proactively to negative reviews is a great way to show you care.

When companies respond publicly to negative online reviews with comments like, “We’re so sorry for the miscommunication. Please contact our representative and we will take care of your issue right away,” prospective consumers gain confidence that the business will address their needs if something goes wrong.

Moreover, customers who rewrite their review after a bad experience can be some of the best public reviews you can get because they show consumers you will work with them if a bad situation arises. So the next time you get a bad review, think of it as an opportunity to show off — and show that you care about customer experience.

4. They publicly educate future customers.
Many business websites have FAQs and return policies that no one ever reads. When things go wrong, consumers often blame the company for bad customer service, even though the business tried its best to state its policies upfront.

By addressing negative reviews publicly, you can help future customers understand your policies and why your company makes certain business decisions. For example, say your business signs up customers to a subscription program when they make an initial purchase. This information is written on your site, but some customers miss it. They then write a negative review explaining they didn’t know they were going to be charged on an ongoing basis.

By answering that review and saying, “We’re sorry you weren’t happy with the subscription. We only use subscriptions because we feel it’s the best way for us to deliver our service to our customers, but we’ve refunded your account and hope you try us again at a later point,” you can show prospective customers how and why your product or service works the way it does.

5. They give you a competitive edge with insights for improvement.
Large corporations spend millions on customer surveys and feedback forms to improve their customer service. Negative reviews are an untapped goldmine of valuable information that can help a business grow and expand.

If someone writes a negative review — justified or not — a business can assume that many other customers feel the same way but didn’t bother to express themselves online, and just stopped using the business’ product or service instead. That review has information that the business can use to its advantage — and that its competitors might not have.

Embracing a glowing five-star review is easy, but even a few one-star reviews can paralyze business owners and cause them to ignore reviews altogether, to the detriment of their business. Instead of fearing reading one-start reviews or engaging with the customers who leave them, you should see each negative review for what it is: a golden opportunity.

Rodney Gin is co-founder of SiteJabber, the leading community of online business reviewers.