Your Business: Customer reviews with Dr Chris Galloway, Massey University

Dr Chris Galloway, a specialist in reputation management and risk and crisis communication at Massey University's business school.

The saying 'everyone's a critic' has perhaps never been truer than it is today.

While word of mouth has always been a powerful force in business, the advent of the internet and social media has given consumers a platform to spread the word about their experiences of products and services like never before, and to a global audience.

Dr Chris Galloway, a specialist in reputation management and risk and crisis communication at Massey University's business school, says it's unlikely an individual online customer review could make or break a business. But he says a string of negative reviews, unless credibly countered, is a different story and could lead potential consumers to look elsewhere to spend their dollar.

So Galloway suggests businesses take them seriously.

"This is an online conversation and what happens in customers' social networks can be just as powerful as what happens in the media when it comes to building or destroying a reputation," he says. "If you ignore the detractors, their voices may only grow louder - and sometimes they can highlight an issue that you may not even be aware of."

This week I've interviewed a handful of small business owners about how they handle online customer reviews and their responses show that, while such feedback is far from their only gauge of business success, they definitely take them seriously.

Sip Mounlath is the owner of Mt Eden-based eatery Bolaven and says customer feedback is always welcome because it's a way of monitoring business success.

"We decided early on that any feedback is good feedback, because it's either a pat on the back for the team or something that we can learn from," she says.

So far, Instagram is the most popular channel for customers leaving online reviews of Bolaven, with diners often taking a picture of their meals and commenting or tagging their location while they're still on site. The eatery has also seen customers review their offerings on Facebook, Zomato and TripAdvisor.

Mounlath says she and her manager are the only people in the business who respond to reviews; sometimes that just involves 'liking' a comment, while "others require a little more diplomacy", she says.

While the business owners interviewed this week are united in saying they take note of customers' reviews and and have implemented action as a result where appropriate, they have differing thoughts on directly responding to reviews online. It's clear there are no hard or fast rules here, with each business' policy hinging on myriad factors such as industry norms, the general nature of their customer feedback, personal philosophies and available resources.

Natalie Le Gal is owner, with her husband Romain, of two Auckland-based French eateries - L'Assiette and La Fourchette. Le Gal says their managers in each establishment keep an eye on the latest customer reviews online, and the businesses have instigated change when common feedback has come through. But to date they've had a policy not to respond directly to any online reviews.

"Responding can be difficult because, depending on the nature of the review, it can be hard to pin it down to a place and time," says Le Gal. "If someone has an issue with the speed of service or with their food when they're in the restaurant you can really react to that, and do what you can to make the best of the situation, But it's harder to respond directly, or gauge how to respond, when issues are presented online."

Neill and Ceillhe Sperath are the owners of Auckland-based tour company TIME Unlimited Tours, which answers every online customer review.

"I find a lot of businesses will justify responding online to something negative about their business, but they won't say thank you when people have taken the time to write something positive," says Neill. "It's about reciprocating the time someone has spent writing something about you, and I think people notice that."

However, Sperath says they've worked hard to build strong relationships across the tourism industry and through a range of channels, because a great business can't be built on good social media reviews alone.

And he has this word of advice for other small business owners when handling prickly comments: "It's very hard not to take it personally when people criticise, but you do have to try not to and instead deal with it professionally. And if you have a genuine negative review, look at it as an opportunity for improvement. We're perfectionists so we always ask 'what can we learn from this and do better?'."

Dr Chris Galloway, Massey University

Dr Chris Galloway is a specialist in reputation management and risk and crisis communication at Massey University's business school.

Can customer reviews make or break a business? What kind of impact can a negative or positive review really have?

It's unlikely that an individual review could make or break a business. But it's quite likely that a string of negative reviews will prompt potential purchasers to look elsewhere - unless the business in question is able to make credible responses to customers' criticisms. When I look at negative reviews I check not only the comments, but also the rating - that is, just how negative was the score? A lot of ratings at the 'red flag' end of the review spectrum would make me think again.

How should businesses handle a negative review?

First, it's important to be prompt - especially if the review is from a 'determined detractor' whose complaints, objectively viewed, have little merit. Be quick to set the record straight, but remember you're talking to a customer, even if it is an unhappy one. So be courteous and adopt a conversational tone. Steer clear of corporate-speak that might get a 'yeah, right' response and, if appropriate, ask the reviewer to contact you offline. If you resolve the matter quickly and effectively, you might score a turnaround positive review.

What are some things you definitely shouldn't do?

A definite 'don't' is to attack the accuser, to 'fight fire with fire' - that usually just makes things worse. Be friendly in tone - even if you're fuming. Also, don't make promises you can't fulfill. Your credibility is on the line. If you want to promise something, make sure you can deliver - and be seen to do so. This is a time to let logic rule, not your emotions. But if the reviewer is upset for good reason, be prepared to show empathy.

On the other hand, what can businesses do to make the most out of a positive review?

Be warm in your thanks and, if the review is especially positive, ask the poster for permission to use it in your promotion.

Lastly, what's a key piece of advice you'd have for small business owners about how to handle customer reviews?

Take them seriously. This is an online conversation and what happens in customers' social networks can be just as powerful as what happens in the media when it comes to building or destroying a reputation. If you ignore the detractors, their voices may only grow louder - and sometimes they can highlight an issue that you may not even be aware of. In a famous case, Intel - the computer chip maker - ignored online complaints about a chip until it was forced into an expensive recall. You don't have to be as big as Intel to fall into the same trap.

Engage with reviewers in a friendly manner and your reputation as a company that not only listens, but also responds, is likely to translate not only into supportive comments, but also into business.

Coming up in Your Business: What are small business owners doing to make their operations more sustainable? What measures are they putting in place to ensure they lessen their impact on the environment and improve their bottom line? If you've got a sustainability story to share drop me a note: nzhsmallbusiness@gmail.com

For more on NZ business ambitions go to www.businessambition.co.nz