Word of Mouth: A Review of Online Reviews

Online Reviews

By Kris Maksimovich, AIF®, CRPC®: 

An astounding 82 percent of US adults have read online reviews before making a purchase or using a company’s services, according to a Pew Research Center poll. What’s more, just over half of those claim to scan the reviews regularly. No doubt about it, word of mouth is a powerful sales tool. But using online reviews as the sole basis of decision-making could be very short-sighted.

People are emotional beings. When things don’t go as expected, they complain. Some even retaliate, and what better way to do that in the information age than to socially flame a company? The good thing about determining the worth of a review is that a company and reviewer often leave an online footprint you can follow that will help you make a better-informed decision.

There are several ways to sort through the noise:

Read all about it

Read several reviews a company has received, both positive, negative and in-between. Look at the reviewer where possible and consider their motive.

The reviewer. The skinny on reviews is that when someone takes the time to leave one, either good or bad, there is already a bias attached to that motivation. Obviously, the individual feels strongly one way or the other about a company, product or service and hopes to sway others.

It’s important to review the reviewer to understand the motive behind their writing a positive or negative review. Some review sites allow you to look at all the feedback left by a customer. A quick click on the reviewer can tell you if they are a habitual complainer or not. Also, if you see identical review verbiage at multiple review sites, you must consider why the reviewer put so much energy into publishing poor reviews across the web.

The company. Check multiple review sources like the BBB, Google, Yelp, Porch, Angie’s List, professional associations and social media pages. Keep in mind that most of these sites allow companies to do paid advertising, which can skew search results on these sites according to Consumer’s Reports.

Though most online review sources claim they do not allow a company to alter or remove reviews, watch for a series of positive reviews after a negative review, which could come from the company’s employees or a reputation site attempting to improve their rating.

Additionally, competitors and staff can write reviews to help skew ratings. Watch for the use of industry terminology and technical details, which may indicate the review was written by somebody on the inside.

Also, check other non-traditional review sources for the company like blog comments, social media posts and YouTube where you can get a flavor for what others think about the company.

Human nature. Though, most rating sites do not allow anonymity, who can tell if the individual is who they say they are? Do you see a public flogging where people jump on the bandwagon because they can? Often social media platforms like Twitter are a hotbed for this type of activity because of the anonymity the site offers.

It’s important to consider the source of discontent and whether the complainer actually did business with the company and worked with the company before they took to the web to try them in the court of public opinion. Some companies show whether the review came from a verified purchase or not. As responsible consumers, we should always try to work with a company first, before picking up the flamethrower and taking to the web.

RSVP: Responding to Online Reviews

Most companies want to make things right and the tone of their response shows this in the way they apologize and ask the individual to discuss by phone, so they can get the complainant’s details. An important aspect to reviewing the review is to look at how the company or their representative responds to negativity. Was the company’s response genuine, did they merely publish a canned statement, or did they ignore the complaint altogether?

In one instance, customers were complaining about a local dog groomer, claiming staff was rude and judgmental about the condition of their pet. Confirming this sentiment, the owner responded to every negative review with sarcasm, finger-pointing and excuses.

Consider each response to criticism. Was the company representative positive or did they seem like they had to have the last word? A lot can be said about the integrity of a company’s response to complaints. If the staff at a company has been accused of being rude to their customers, and an overwhelming number of responses seem argumentative, there might be something to the complaints.

A special challenge for financial advisors

With financial advisors, the review process can be especially challenging, since in the past FINRA has required positive reviews to be removed, leaving only negative ones. Though it was meant to keep favoritism from entering the picture, this tactic can skew public opinion in the opposite direction, especially when a potential client doesn’t look any further.

Again, consider what the intent of the negative review is. Did the reviewer attempt to flame the advisor by spreading negative reviews across as many review sites as they could locate? Coming across a poor review of an advisor does not necessarily mean it defines them.

In the past, advisors have not been allowed to respond to reviews. A lack of response by an advisor does not hold the same weight as with others. Look for other affirmation online. How do they use social media? What does their content say about them? Pick up the phone and call them to discuss the details of the negative review. Allow them an opportunity to respond, even if they cannot do so online.

More important, using FINRA’s Broker Check can assist in determining if an online complaint was filed with the proper authorities and whether it was validated or not. Often, a complaint is made and dismissed after thorough investigation in a highly regulated industry, but online reviews remain.

It may not be possible to understand someone’s motive for providing a negative review but doing some research can certainly help. According to the Pew Center, the more adept consumers are at searching reviews, the more confident they are in their decisions.

You can’t please everyone all the time

Invariably, most companies will receive negative reviews at one time or another. It’s simply not possible to make everyone happy all the time.

Google reviews of the Plymouth Rock landmark give it a 4.1 out of five stars, with some one-star reviews mistaking the landmark for their insurance company and yet others complaining that the rock is too small. Clearly, you cannot please everyone even some of the time, even when it comes to a national treasure.

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Kris Maksimovich is a financial advisor located at Global Wealth Advisors 18170 Dallas Parkway, Suite 103, Dallas, TX 75287. He offers securities and advisory services as an Investment Adviser Representative of Commonwealth Financial Network®, Member FINRA/SIPC, a Registered Investment Adviser. He can be reached at (972) 931-3818 or at info@gwadvisors.net.

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