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The Measure of ROI on Online Reputation Management

Ever used an online review site like Yelp or Google Maps to make a purchasing decision? Maybe it was a restaurant or cleaning service you had heard of but weren’t quite sure about its quality so you turned to online reviews. You’re not the only one. Online reviews are becoming one of the driving factors behind consumers’ purchasing decisions and as a result, online management reputation is a critical part of a business’s marketing strategy.

Warren Buffet once said, “It takes 20 years to build a reputation and five minutes to ruin it.” Negative online reviews are one of a brand’s deadliest assassins.


But what about the Return on Investment for hiring a company that does manage a company’s online reputation? The number can seem elusive, but we can start to explain it by by looking at what companies stand to lose by not investing in their online reputation.


According to a Moz study, 22% of consumers are turned off if they see a negative review on the first page of a Google search. Another 22% are turned off if they see a negative review on the second page, followed by 15% on the third page. In other words, a business will lose about 59% of its prospective clients if it has a negative article found on the first three pages of Google.


For a more in-depth way of calculating just how much a company could be losing as a result of negative online reviews, Senior Brand Strategist, Ryan Erskine at BrandYourself gives us a great formula here. (However, we are working on a program that will include as part of the overall package the ability to constantly calculate our clients’ ROI, so that they don’t have to do the math.)


We, WebPunch, surveyed more than 1,000 people about their purchasing decisions and found out just how many people are using online reviews. 41% of consumers say they use them as a resource when making a purchasing decision. 47% use Google while 21% use Facebook and Yelp.


Ever heard of the “United Breaks Guitars” story? Guitar player David Carroll had landed in Chicago O’Hare only to find his $3,500 guitar to be pretty banged up. He spent the following months trying to work with United to get some sort of reimbursement, but to no avail. So instead he wrote a song called “United Breaks Guitars.” Within days, the song had millions of hits on Youtube and United’s stock plummeted. Had they just responded to Carroll and reimbursed him for damages everyone could have moved on.


An online reputation management firm is able to provide a company with a snapshot of their online reputation as a whole. They compile reviews and feedback from the many platforms, craft responses to negative and positive reviews, and are coaches on how to continually connect and reconnect with customers.


If you’re already engaged with a reputation management firm, you are right in questioning your ROI. However, if you’re not, we want you asking something else: how much business is your company losing by not investing in your online reputation?