Merchant Centric, a leader in identifying actionable operational intelligence and reputation management, published a new research study in conjunction with Xenial, a leader in the restaurant technology experience, showing a 66 percent jump in online reviews of businesses. An analysis of 27 million U.S. businesses, which included restaurants, retail, health and beauty and personal services among others, revealed total reviews increased to over 610 million reviews in the past year. This dramatic increase in online reviews along with the increase in the number of businesses that are replying to reviews underscores the growing importance social reviews are playing.

In the restaurant sector, the significant increase in online reviews suggests the growing impact, both positively and negatively, that these reviews can have on revenues. For example, according to a report by Harvard Business Online, a one-star bump in a Yelp rating can translate into a 5- to 9-percent increase in revenue.

As a result, restaurants are becoming far more proactive in engaging with guests’ online reviews. According to data from March 2017 to March 2018, there was a 29 percent increase in the rate of restaurants that have responded to online reviews. Overall, restaurants engaged with guests at a 46 percent higher rate compared to other businesses.

“Our research shows consumers rely heavily on online reviews and social media for restaurant recommendations,” says David Bay, CEO of Merchant Centric. “Reviews have become incredibly influential since people consider them as first-hand reliable accounts, as if it was a friend giving their opinion. It’s now vital for restaurants to interact with online reviews in order to increase revenue.”

“Online reviews are the new word-of-mouth, and a single review or post can have a dramatic impact on a business when it reaches thousands or even millions of users,” says Christopher Sebes, president of Xenial. “Actively engaging with both favorable and negative reviews can have an enormous impact on one’s business. Our data shows that customers respond more positively to a business that engages with them, and that’s why this technology is so instrumental in improving the consumer experience and driving sales.”

The data also looked at the top ten restaurant categories and their frequency of guest engagement by category. This indicates how guests are leaving reviews relative to other categories, not the rate at which these businesses are responding.

Most engagement:

  • Steakhouses
  • Seafood
  • American

Least engagement:

  • Pizza
  • Chinese
  • Barbeque

Restaurants using Merchant Centric’s technology range from larger multi-unit brands such as Firehouse Subs, Bar Louie and Sharky’s Woodfired Mexican Grill to single location restaurant operators including Mama’s Café Baci, Jinky’s Café and Gardner Village, who are all looking to engage smarter with their digital audiences.

“The Merchant Centric technology is crucial to how we manage our engagement activity with guests making online reviews,” adds David Goldstein, CMO of Sharky’s Woodfired Mexican Grill. “Since implementing the technology, we’ve been able to evaluate our reputation online and interact more effectively with guests who provide feedback, allowing us to better communicate how much we truly care about their experience at our restaurants.”

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