Online Reviews: Making or Breaking a Restaurant
How did you hear about your favorite restaurant? Maybe you stumbled upon it while driving down the road. Or perhaps your friend told you that this is the absolute best place to be on a weekend night. Nowadays, the answer to this question is most probably that you did you searching on the internet and came across a restaurant and looked at the star rating of that place and made your decision whether or not to go to the restaurant based on that rating.
Online rankings have a big influence on the restaurant and entertainment businesses and can greatly affect whether or not you visit a restaurant. A pair of professors at the University of Berkeley sought to look at the relationship between online star ratings and customers’ purchasing decisions. They looked at over 300 restaurants in the San Francisco area and then focused on the effects of positive online ratings. They found that when a restaurant’s rating improved by only half a star, it was much more likely to be filled at dinner time. The restaurant’s 7pm bookings, on average, went from 30% to 49% full after the restaurant’s star rating had gone up.
However, one milestone was establishing cause and effect. Even when prices and restaurant quality is held constant, changes in customer preferences do occur; which can make all the difference. These changes in reviews can greatly affect a new user’s opinion of the restaurant, even if nothing in the restaurant changes.
Additionally, when there are few other alternatives for “unbiased” information on a restaurant, the Yelp review of an establishment can be held to a much higher value, leading businesses to even hire people to write enthusiastic reviews on Yelp for their own restaurant. This becomes an issue online as now the feedback on a restaurant is skewed and the people who want to receive information are receiving biased information in a supposedly unbiased setting.
In the end, whether or not a restaurant succeeds relies heavily on the legimate quality of the restaurant. However, peoples’ opinions do matter and can cause a heavy shift in the performance of a restaurant.
http://www.theguardian.com/lifeandstyle/2012/sep/02/ratings-boost-restaurants