Why monitoring your reviews online matters?

It is something every restaurateur knows: good reviews boost takings while terrible ones can close you down. And, in an age when everyone can be an online critic, ratings have never been more important.

Work by two economists at the University of California, Michael Anderson and Jeremy Magruder, aimed to measure the relationship between online star ratings and customers’ purchasing decisions.

They found that a restaurant with a rating improved by just half a star (on a scale of 1 to 5) was much more likely to be full at peak dining times.

 

This was further backed up by Michael Luca, who published research in 2016, and found that a one-star increase in Yelp rating leads to a 5–9 percent increase in revenue.

Importantly, the two economists found that the increase in trade happened without any change in prices or the quality of food and service, confirming that it was the reviews that brought in the new customers.

The economists conceded that, while restaurants with strong reviews on the site did better business than poorly reviewed restaurants, establishing cause and effect was difficult.

“After all, restaurants that get good reviews are those that appeal to consumers and they would probably do well even in the absence of any reviews,” the pair write. However, they are confident the research is robust. They note that, when Yelp computes a business’s average rating (which ranges from 1 to 5 stars), it rounds off to the nearest half-star.

 

So, two restaurants that have similar average ratings can actually appear to be of very different quality to online viewers. For example, a restaurant with an average rating of 3.74 displays a 3.5-star average rating, while a restaurant with an average rating of 3.76 displays a 4-star average rating.

This, the economists claim, allows them to make important comparisons between restaurants that have different ratings — for example, 4 stars versus 3.5 stars — but are of nearly identical quality (for example, a 3.76 average versus a 3.74 average). Their conclusion? That half a star makes all the difference.

Furthermore, they found that the effect was more profound when alternative information was hard to come by, opening up the possibility that invented reviews could boost fortunes.

The pair write: “These returns suggest that restaurateurs face incentives to leave fake reviews, but a rich set of robustness checks confirm that restaurants do not manipulate ratings in a confounding, discontinuous manner.”

So what can you do about it?

We believe that there are 4 key steps to turning around social media performance.

  1. Inspect the data
  2. Incentivise your staff
  3. Be proactive and respond
  4. Address root causes

Inspect the data

To quote Louis Gerstner, ex-CEO of IBM :

“You don’t get what you expect, you get what you inspect”

… and the same is definitely true of social media scores.

Can you answer the following questions:

  • Which was my top performing store on social media this month?
  • How many likes do I get for an average post on Facebook and how did this month compare?
  • Do I have any critical reviews outstanding that I need to respond to?

If you can’t answer them within a minute or two — you need to work on your tools. Whether you invest in a solution to aggregate reviews for you, or have someone collate a regular report — you need to understand this data in some detail.

Incentivise your staff

Just making sure managers are aware of social media reviews will help — but there’s nothing quite like making social media scores part of an employee scorecard to help drive positive reviews. We’ve seen customers include an average review metric as 10% of a balanced scorecard impacting bonus at the end of each month. Of course, go to far and you could start seeing odd behaviours — an employee may push customers to make reviews — so use in moderation.

You can also run competitions, or have a “mention of the week” type award to rewards one-off performance.

Lastly, it’s important to role model the behaviors you want to see — make social media scores a topic at team meetings, and an important part of the day to day.

Be proactive and respond

 

Don’t just let negative reviews sit there — make sure you’re responding to them, and trying to remedy the situation. Customers are looking at the responses and well, and want to see an engaged restaurant.

Best in class restaurants can respond within a couple of hours — and it shows you’re thinking customer first. It’ll also help you get closer to the pulse of customer feedback.

Address root causes

Of course, you also need to listen to the content of customer feedback. Not all of it can be fixed with a staff incentive or by listening more closely.

Example of structural issues may be things like poor menu selection for vegetarians, or long wait times on certain days. Each of these comes with an obvious action that you can then decide to make if the reviews persist. Listening closely will help give you this feedback.

If you’d like to see how Tenzo can help you power all of the above — please get in touch for a demo.

Case Study: Why did Getti decide to use Tenzo?

Getti is an italian restaurant chain situated right in the heart of London with two central London locations on Jermyn Street and Marylebone High Street. The name of the restaurant derived from spaghetti which was then shortened to ghetti. This chain was created by the entrepreneur Stefano Fraquelli, a figure of the restaurant industry of London. It is a family run business which is today manage by his two sons Alberto and Andrea. In every restaurant, you will find a wide directory of popular Italian cuisine, friendly service in a convivial, relaxed Italian atmosphere.

 

“First impressions clean friendly and authentic Italian. The menu is varied from wood fired pizza, a reasonable choice of pasta secondi and homemade desserts that you struggle not to what more than one! All fresh generously portioned and one of the best Spaghetti Vongole I’ve eaten. Great atmosphere too. Can’t wait to return.” Arif S. — Tripadvisor

“We have dined at Getti’s on many occasions, mainly for lunch and over the last 5/6 years have found it consistently excellent — The pasta is wonderful complimented by the extremely personal and obliging staff who always make the visit a delightful experience.” Peter C. — Tripadvisor

When, we met Getti owners for the first time, we discussed about their daily challenges which allow us to identify three main issues.

  1. It is inconvenient to follow exactly what happened on their various social and review channels and get an understanding of your customers are saying about the restaurants.
  2. Have concrete feedback to give to their employees and incentivise them to sell more.
  3. Have an accurate forecast to ensure that they have the right level of fresh stock in order to maintain their ability to always serve the whole menu.

More generally, they told us that it was challenging to quickly gather all the useful information and insights in one place to help them in their decision-making.

To address these challenges, they decided to try Tenzo as a solution to boost their productivity and to give them actionable insights. After few months of using the Tenzo solution the main point they highlight is that Tenzo is a user-friendly application which helps them save money.

Tenzo helps them in different ways with reliable figures and data that they can trust. Once again, they save a lot of time by gathering all the information (sales forecasting, social reviews, employee’s performance…) in one place. From now on, they have the ability to refer to feedback to see and drive employee performance, they can quickly assess the damage caused by bad reviews on TripAdvisor or Google Places or even reduce wastage by having a more accurate forecast.

“I think that an app like Tenzo could be useful for any other restaurants” Andrea Fraquelli — Co owner of Getti

Watch the video testimonial: