Picture this: You are visiting a new town and want to try a new restaurant, but you donโt know whatโs around. You can ask the concierge for recommendations and use handy-dandy Google to look up nearby restaurants and their reviews. These help you find a lovely Italian restaurant down the road serving pasta that is โto die for!โ
However, the next day, you find a nearby coffee shop using the same method. The business had 4-star reviews, but the wait time was very long, and the coffee you ordered was bland. What went wrong?
When it comes to making purchases, we often use word-of-mouth recommendations from our friends and family. But how trustworthy are word-of-mouth recommendations? Read on to learn more!
What Does Word-of-Mouth Mean?
Word-of-mouth, at its basis, refers to when a company or a person is talked about to someone else. Word of mouth happens without any direct influence or reward from the company being talked about. This could look like someone simply telling their friend how their regular coffee shop made their order perfect that morning, influencing the friend to visit the shop the next day.
Where is Word-Of-Mouth Used?
For businesses, Word-of-mouth is one of the most successful ways to acquire new customers. In fact, in a 2018 study, 83 percent of consumers were more likely to purchase a product or service based on a recommendation from a friend or family member. Word-of-mouth can also be a great way to find new hires. This could look like a current and trusted employee recommending someone they know for an open position.
What are the Pros and Cons of Word-Of-Mouth Recommendations?
Word-of-mouth recommendations are a driving force for 20-50% of all purchasing decisions and can even be ten times more effective than paid advertising. Friends, family, and honest reviewers have nothing to gain from positive reviews of a company, making listeners put high value on what they have to say.
However, the word-of-mouth method isnโt foolproof. Unfortunately, there are times when recommendations can be misleading or completely incorrect. In some cases, poor experiences and the resulting reviews could be a fluke. In other cases, a company could have filled their Yelp reviews with fake reviews, falsely heightening their star rating.
How Can I Trust Word-of-Mouth Recommendations?
While it is essential to always look at reviews with a critical eye, there is still great merit in accurate word-of-mouth recommendations. However, it can be tricky to find the balance between completely distrusting any suggestions and setting expectations too high. Consider these three questions to determine a recommendation’s merit and validity:
Where is the Recommendation Coming From?
It’s important to note where a recommendation is coming from and where the reviewerโs biases are placed. If your best employee, who wants to help your company succeed, recommends a previous colleague for a role, you can have more confidence that that person will be a good fit. However, if an online reviewer is best friends with an owner of a record store, they are more likely to give it high praise despite the poor experience other customers have.
The answer to this question does not always determine if you should completely listen or dismiss a recommendation. Still, it can help you decipher how your experience will differ from the reviewerโs.
What is the Ratio of Positive to Negative Reviews?
If you are looking at an e-commerce website for a product, a quick glance at the star rating can help you determine the quality of the product. It is also important to note the number of reviews the product has. If the product has five stars but only three reviews, it is difficult to know how consistent the product and company are or how truthful the three reviews are. However, if a product has four stars but 3,000 reviews, it shows that a large pool of people have had positive and consistent experiences with the product.
Are There Any Red Flags?
Companies know how helpful online reviews can be, which can, unfortunately, lead to a high number of fake reviews that are becoming more difficult to spot. It is estimated that 31% of reviews on e-commerce websites were fake in 2021, and 74% of consumers read fake reviews in the last year. Here are some key things to look for in a review if you want to spot a fake review:
- Profile Picture: A fake reviewer may use a stock photo image or an image of a celebrity.
- Profile History: A true reviewer will have a dynamic history of the places they have visited, giving varying star levels. A fake profile will often only give five-star reviews.
- Details Provided: An honest reviewer will give a decent amount of detail, such as who they went to a restaurant with and what they ordered. A fake reviewer may give zero details or particular details that wouldnโt commonly be top-of-mind.
- Generic words and phrases: A five-star review is high praise, but it loses its validity if it is only followed up with one word or a generic sentence.
Take It With A Grain of Salt
While there are bound to be fluke days with poor company experiences or deceptive fake reviews, it doesnโt mean all hope is lost for word-of-mouth advertising. Looking at reviews and recommendations critically can help both businesses and consumers continue to benefit from word-of-mouth advertising while reducing risk with poor or false reviews.
Here at Matcha Design, we understand the weight that word-of-mouth advertising can have for companies. To learn more about how Matcha Design can help you reap the benefits of word-of-mouth advertising, visit us online today.
