02-09-2022

Online Reputation
Management

Product Reviews

Introduction

• How important is ‘Trust’ in a marketplace?

• More so in online marketplaces

• What are the challenges in creating trust in the online marketplaces?

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Online Reputation

• Consumer Exit – Voice Theory

• In the digital market space consumer is choosing to voice rather than exit

Online Reputation

• Everyone’s a critic
• Employer reviews – Glassdoor

• Product reviews – Amazon

• Service reviews – Yelp; TripAdvisor

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Online Reputation

• Two types of online reputation ratings:

• Curated Reputational Ratings

• Uncurated Reputational Ratings

Curated Reputational Ratings

• Ratings are produced by third party – considered neutral

• Curated ratings are transparent

• Higher score is beneficial

• For example,
• Fortune magazine’s – ‘The World’s Most Admired Companies’

• Times – ‘World University Rankings’

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Uncurated Reputational Ratings

• Posted by anonymous members of the general public on digital

platforms
• TripAdvisor, Yelp, RateMyMD, etc.

• Organization's online reputation is determined by the feedback of

many people, rather than by a single curator

• Different algorithms and the lack of transparency

Uncurated Reputational Ratings

• Positive uncurated ratings are beneficial

• Wisdom of crowds

• Caution – ‘herd mentality’ bias

• Number of online ratings and average score is important reputational

signals

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Facts about Reputational Ratings

• Is the link between rating outcomes and benefits direct and obvious?

Facts about Reputational Ratings

• Is the link between rating outcomes and benefits direct and obvious?
• Might seem but there are nuances!

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Facts about Reputational Ratings

• When everything is positive, the search shifts to distinguishing

among those ratings
• If all are five star ratings – consumers actually have to read the reviews!

• Many positive ratings, one negative review

• Will not affect its overall level of stars

• Negative review might be the first review they see

Facts about Reputational Ratings

• When everything is positive, the search shifts to distinguishing

among those ratings
• Research on ordering effects
• Most visible and first-read review has an inordinately large impact – particularly on
inexpensive products like a movie or a meal

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Facts about Reputational Ratings

• Once they reach the top, ratings tend to decline!

• Any idea why?

Facts about Reputational Ratings

• Once they reach the top, ratings tend to decline!

• Company or product with five-star rating, attract a wide variety of customers

• These customers may not be a good fit for the company or product
• Likely to have unrealistic expectations – translate to negative experiences

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Facts about Reputational Ratings

• Ratings matter much less to repeat customers!

• Once customer gain experiences with a company or product
• Experiences are likely to have greater influence on loyalty than are the ratings

• An important caveat,
• Repeat customers do care about ongoing ratings for status goods or services

Using Ratings as a Learning Tool

• Ratings provide valuable information about competitors

• Curated rating criteria are disclosed so can gain information about the
competitor

• Uncurated rating – provides info about rival’s strengths and weaknesses

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Using Ratings as a Learning Tool

• Ratings provide valuable information about customers

• Anecdotal experiences of friends and family are also important
• 83% of mothers & 74% of fathers get info about products and services from social media

• Ratings can provide consumer-targeting insights

• Online ratings and reviews supplement internal data to aid in segmentation
and targeting

Using Ratings as a Learning Tool

• Negative ratings can increase trust and awareness

• Mix of positive and negative reviews increases trust
• Feeling of getting a more accurate information

• Help set appropriate expectations

• Ratings can be industry game changers

• This occurs when ratings becomes important to buyers
• Michelin three-star restaurant