Yelp and Others Change the Way Small Businesses Do Business

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Small business reputation management site, 5StarControl, takes on the topic of how online reviewers are changing the way consumers share and view shopping and dining experiences with the help of Yelp.

5Starcontrol has decided to issue an announcement about the benefits small businesses gain from paying attention to online reviews from consumers. 5StarControl stated that online marketing for small business strategies will be impacted if businesses refuse to take consumer review sites like Yelp seriously.

The Oregonian Public Broadcast (OPB) News reported on August 03, 2012 that online reviewers who frequent Yelp, affectionately called, “Yelpers,” help local small businesses stand out from their competitors. Many professional Yelpers are gaining reputations for accurate, honest reviews from other consumers who follow their reviews on Yelp. This is happening to such an extent that many small businesses are beginning to court Yelpers in the hopes of getting a positive review. A recent study by Professor Michael Luca of Harvard’s School of Business concluded that Seattle restaurants that receive a 1-star increase in ratings can expect to profit from a 5 – 9 percent increase in profits. He said that locally owned businesses, specifically restaurants, receive the most benefits from Yelp reviews. He believes this could, “change the balance of independent vs. chain restaurants in the future.” Despite growing competition from other online review sites, Yelpers agree with his conclusions, the report said.

5StarControl believes the growing trend of professional Yelpers gaining a following among Yelp users highlights the need for local small businesses to use reputation management tools and services to protect their business from losing consumer traffic due to negative reviews. Lucas’ study, while aimed at Seattle area restaurants, can be seen as a portent of things to come with all small business enterprises. But courting positive reviews to overcome bad feedback is not always enough.

Even though positive reviews have been shown to be beneficial to small business’ revenues, it might not always be enough – and sometimes, too many positive reviews can raise red flags for Yelp’s content filters. On the flipside of that, the Seattle Times reported on August 2nd that Yelp received some negative reviews of its own from Seattle businesses who claimed Yelp pressured them into buying advertising by manipulating data to make their reviews appear more negative than they actually were, saying Yelp’s filters were at fault. 5StarControl believes this type of situation is the reason many local small businesses are turning to professional reputation management companies for their marketing needs. With the help of the right professional, small business ratings can be more easily managed.

Business ratings can also benefit from Frank Kern’s material, which 5StarControl recommends to all its clients. As Luca’s study demonstrates, small businesses are more profoundly impacted by how online reviews affect their ratings, which in turn affects their appeal to new customers and investors alike. But the competition from online review sites can be confusing to many small business owners.

Yelp’s competition includes sites like Angie’s List, Facebook, and CitySearch, to name a few. Even so, Yelp’s recent financial success for their second quarter earnings, coupled with Yelpers’ growing popularity with other consumers, keeps them ahead of the pack. 5StarControl does not believe Yelp with lose its first-place spot in consumer review reporting anytime soon.

5StarControl is a website that covers small business concepts in the area of reputation management.

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