Star Power: A Small Hike in Online Star Ratings Can Boost Conversions by Up to 25%
"Near me" searches - localized mobile searches for brands and products close by - have exploded. Today, 82% of people have tried a "near me" search on their mobile devices; among Millennials, near me adoption is even greater, at 92%. More than ever, as search engine and smartphone technology have advanced, consumers are prioritizing proximity and convenience.
Uberall, a global location marketing SaaS company, has released its first "Reputation Management Revolution Report," a benchmark study analyzing the impact of customer reviews on both brands and consumers.
For the report, Uberall analyzed the Google My Business (GMB) profiles of 64,000 global (740 or more reviews per location), enterprise (10 or more locations), and SMB (up to 9 locations) business locations in four countries, the U.S., U.K., France, and Germany.
For brick-and-mortar brands, online customer reviews are a key part of the near me brand experience. When conducting near me searches, consumers often turn to reviews and star ratings of locations across platforms like Yelp, TripAdvisor, Facebook, Instagram, Google, and more. In fact, almost half of all consumers have left such a review online, with 95% influenced by reviews in their buying decisions.
Key findings from the report include the following:
1) A review rating increase of 0.1 can boost conversion by up to 25% - Unsurprisingly, the higher the star rating of a business location, the higher the conversion rate. Conversion rate is a combination of phone calls, requests for driving directions, and website clicks. However, even a marginal increase has a dramatic impact. Uberall found that a star rating increase of just 0.1 could increase the conversion rates of a business location by 25%.
"Consumers who are engaging with the brand are also extremely likely to visit a store within 24 hours, so a 25% rise in conversions could also mean a 25% increase in foot traffic every day. By focusing on review star rating and reply rate, brands can massively affect their overall conversion rates," said Norman Rohr, senior vice president of marketing at Uberall.
2) Getting to a 3.7-star rating is a key benchmark - Locations that move from a 3.5 to a 3.7-star rating experience conversion growth of 120% -- the highest percentage growth jump from any star rating. This means that a business location's first priority should be to get all their locations above the 3.7-star rating threshold. Uberall also identified three specific review benchmarks businesses must reach to achieve the best growth for their locations: 3.7 stars, 4.0 stars, and 4.4 stars.
3) A review reply rate of 30% wins more customers - Global and enterprise business locations have the lowest review reply rate. Reply rates by business type were SMB (25%), enterprise (12%), and global brands (9%). However, Uberall found that a 30% reply rate is the benchmark for conversion growth to outstrip competitors. For example, when enterprise locations replied to at least 32% of reviews, they achieved 80% higher conversion rates than direct competitors and SMBs that replied to just 10% of reviews.
In Uberall's analysis, when broken down by business size, SMBs are averaging higher conversion rates than the bigger brands until the 4.4-star rating mark. At that point, global and enterprise businesses start to outperform SMBs. A rating increase from 3.7 to 4.4 can increase a global brand's conversion rate by 120%, while an enterprise location's rates go up by 80%.
"SMBs, more so than bigger brands, rely on customer reviews to drive brand awareness and visibility," said Rohr. "As a result of that, they are performing better than the enterprise and global brands, which typically have lower review rates and lower reply rates. To outperform both larger and smaller businesses in their area, SMBs need to be focused on replying to a large majority of reviews and keeping their rating above the third star rating benchmark of 4.4."
The full "Reputation Management Revolution Report" is available free online.
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