Online Reviews and Changing Business Dynamics
3 mins read

Online Reviews and Changing Business Dynamics

Online reviews have created a balance in favor of consumers. With an increase in the immigrant population, the traditional ‘word of mouth’ local knowledge has decreased and consumers are more reliant on online consumer reviews. The obligation lies with the reviews websites to ensure the authenticity of online reviews

Recently I ordered for pest control in my home through an online service aggregator. The serviceman arrived even before the scheduled appointment, was considerate of our request to wait for sometime and after finishing his job, asked for feedback spoken. When I said that I was happy with his work, he requested for a good rating on the online aggregator website. I could sense the extra effort he was giving to make me a happy customer, maybe he was trained by the company he worked with or maybe it was just how he learned to improve his business, but in quest of better online reviews, he was putting extra effort to deliver an improved service.

Online reviews play an important role in consumer decision making. Most e-commerce portals have reviews for the products as well as sellers that consumers can refer to before placing the order. Hotel aggregators show the hotel reviews before booking. Whereas service aggregators have reviews for service providers though they don’t always display them beforehand. For e.g. Ola and Uber allocate drivers based on location but the rating is only visible after they have been allocated. While for e-commerce reviews directly impacts sales, in latter the employer awards the employees using various schemes. Even local businesses that don’t have much online presence, have google reviews available and have reviews on local classified websites like Justdial.

Reviews help business as much as it helps the consumers. They provide transparency in the business ecosystem and increase trust among the customers and sellers. As our immigrant population grows, the traditional local ‘word of mouth’ knowledge decreases and people rely more on these online reviews to select services and products. True, some brands have a nationwide presence and their service is standardized across different regions, but for lesser-known services and informal sectors, this information creates a balance in favor of consumers.
Businesses have recognized the importance of reviews and make every effort to create a positive online presence and sometimes even try to find loopholes in the reviews platforms to push for artificially created better reviews. The obligation lies with the review websites to ensure the authenticity of the reviews. Websites like Amazon & Flipkart do provide a ‘verified purchase’ tag while showing reviews. In an interview, Zomato founder Deepinder Goyal said that they use an algorithm to keep fake reviews out of sight from the consumers. These efforts increase the credibility of such web portals along with the businesses. Websites also encourage consumers to provide ratings to the products and services by following up on the purchase. Consumers need to be more aware to rate the products and services responsibly. Good products and services must be rewarded with positive reviews and lack of them must be highlighted to the consumer communities.

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