Businesses should respond to negative social media reviews

By Jeff Blodgett
Aug. 13, 2017 at 9:39 p.m.
Updated Aug. 14, 2017 at 6 a.m.

Jeff Blodgett

Jeff Blodgett   contributed photo for The Victoria Advocate

Social media is a double-edged sword for many companies, particularly those in the hospitality industry, such as hotels, restaurants and resorts.

Although savvy business owners can take advantage of social media to reach more people, their ultimate success relies heavily on online customer reviews. In today's digital marketplace, many people comment on their experiences on social media sites such as Twitter, Yelp, Foursquare and TripAdvisor.

These reviews generally are considered trustworthy, coming from fellow consumers with firsthand knowledge about a particular company. Unfortunately, studies show negative reviews are more influential than positive reviews, and 80 percent of consumers consider these reviews when making purchasing decisions.

Some companies post responses to negative reviews, but do these replies help a company maintain a favorable reputation?

Mei Alonzo, a colleague at the University of Alaska-Anchorage, and I studied this issue. We designed an experiment to investigate whether the impact of a negative online review depends on the underlying cause of the problem and whether it is helpful for management to post a response, providing an explanation and apology.

We asked people to imagine they were planning a trip to New York City and were searching online for a hotel near Times Square. They were presented information about a small boutique hotel in midtown Manhattan along with several customer reviews - mostly positive but a few negative - posted on a fictitious travel site.

The results indicated when negative reviews involve issues that are not under management's day-to-day control, the company's reputation is not harmed. In these situations, potential customers seem to disregard the negative review and not hold the company responsible. Thus, it is not essential that management post a response.

However, when online reviews deal with issues management can control, the company's reputation is at risk.

Fortunately, in the latter situations, a carefully crafted response can reduce the effects of a negative review and help restore the company's reputation. Responding to these types of negative reviews - with an apology and assurance of future satisfaction - shows the company cares about its customers and allows it to recover from its mistakes.

Although these findings are good news for hospitality firms, we found as the number of negative reviews about controllable issues increased, management's responses became less effective.

Nonetheless, management responses serve - if not fully, at least partially - to counterbalance the damaging effects of unfavorable reviews, and thus it is always beneficial to respond to negative online reviews.

Responding to online consumer reviews should be considered an investment that benefits a company. It helps to ensure repeat patronage of the customer who posted the review, and it reassures potential customers these failures will not be repeated. By responding, the company signals it cares about its customers and projects a trustworthy image.

Companies that do not respond to negative reviews risk letting consumers draw their own conclusions. In that case, consumers might simply assume the company is incompetent or does not care about its customers.

Jeff Blodgett is a marketing professor in the University of Houston-Victoria School of Business Administration.



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