Protecting Your (Online) Rep
Businesses must keep and eye on and maintain their appearance in the eye of the public, including the social media world.
By Brian Heppner
As a franchisor, you want to have complete control over your brand, but your brand reputation could get in the way. Brand reputation is an intangible component of a business, driven primarily by what customers share about their experiences with your business and how consumers perceive you as a result. Today, this sharing is happening primarily online, on social media and on third-party review sites, and it shapes a business’ online reputation.
Marketing leaders are catching on to the fact that online reputation can be a major asset or a tremendous detriment to business success. A 2018 survey of marketers revealed that more than 50 percent of them considered online reputation management essential to the success of their business and an even greater percentage planned to increase their investment in online reputation management. Still, many businesses hesitate to integrate online reputation management into their overall marketing strategy because of the challenges with calculating online reputation management ROI.
What is Online Reputation Management?
Today’s consumer relies heavily on search engines, review sites and social media to research businesses and make purchasing decisions. Their expectation is that your business will be just as visible and responsive online as you would be in-store. Online reputation management protects your brand online by establishing your online presence and engaging with your customers on the platforms they frequent. An effective online reputation management program would involve:
Claiming and branding review pages and social media profiles
Responding to all reviews
Flagging inflammatory and false reviews for removal
Engaging with customers on social and online platforms
Cross-promoting reviews
Why Invest in ORM?
Businesses with a positive brand reputation have been proven to outperform those with poor reputations in terms of growth, earnings, market value and stock price. Furthermore, businesses that have made investments in online reputation management – from devoting in-house resources to monitor social media to hiring external agencies for full-service reputation management – have seen results, the most significant being sales growth. Because of this impact on the business’ bottom line, online reputation management has become a necessity. It is even more important for franchises whose network-wide brand reputation can be impacted by the reputation of just one of the hundreds of locations in the network.
So how do you make the business case for an investment in an online reputation management program?
There are several schools of thought when it comes to evaluating online reputation management return on investment, but the most apparent evidence focuses on its impact on revenue by predicting consumer behavior.
It’s a foregone conclusion that a poor online reputation equals lost revenue, and research studies have allowed marketers to quantify this impact.
ORM and Lost Revenue
Social media and review platforms are considered the most important for online reputation management. According to a local consumer review survey, more than 70 percent of consumers depend on social media to guide their purchases, and about 90 percent of consumers will read a review online before deciding to visit a business.
Successful online reputation management increases engagement and positive sentiment on social media, and boosts ratings on review platforms. While it’s difficult to quantify the impact of isolated reviews or comments, research has made it possible to project the impact of online reputation management on revenue.
A Harvard Business School study found that each one-point increase in a business’ rating leads to a 5 percent to 9 percent increase in revenue. Based on your business' ratings, you can make estimations of lost revenue by projecting the expected consumer behavior once any shortfalls are corrected by effective online reputation management. For instance, if online reputation management delivered just a one-point increase in rating, you could expect a 5 percent increase in revenue.
Similarly, expected consumer behavior on social media allows you to calculate the potential impact of online reputation management on revenue. A Bain & Company study estimates that when businesses engage with customers on social media, those customers are likely to spend 20 percent to 40 percent more with the business. A business can use these projections to assume lost revenue if their social media presence is lacking.
Making the Investment
The benefits of a positive online reputation are too significant to ignore. Businesses have reported revenue growth, increased trust, higher conversion rates and boosted rankings in local search results by managing their digital presence – all of which impacts your overall goal to win more customers and drive growth. With this in mind and armed with the knowledge of how online reputation management delivers ROI, you can be confident that this investment will positively impact your network.
Brian Heppner is Head of Franchise Sales for GoDaddy Social and has more than 14 years of experience in the marketing technology industry. To learn more about GoDaddy Social, visit franchise.org/godaddy-supplier.