NRA offers members guide for managing your restaurant's reputation on online review sites

Word of mouth—those three little words have always been critical for restaurants, with customers spreading the news about their dining experiences to family and friends. Today, word of mouth is more pervasive and powerful than ever due to increasing popularity of online reviews and social media.

Customers air their opinions for all to see online. Whether a guest raves or rants about your service, it’s not just a passing comment to a friend or two. Reviews may remain online for years, influencing countless potential customers. Plus, the dramatic increase in smart phones puts reviews literally in the hands of millions of Americans and international travelers as they’re deciding where to dine out.

Review site affect customer dining decisions. More than one-third (34 percent) of diners report that information on a peer review site is likely to factor into their decision when choosing a restaurant, according to the National Restaurant Association’s 2012 National Household Survey. Online reviews hold even more weight with frequent diners and millennials, today’s young adults. Over half (53 percent) of 18- to 34-year-olds report that online reviews factor into their dining decisions, as do 47 percent of frequent full service customers.

An online search of your restaurant is likely to find not only your website, but also your restaurant’s profile page on Yelp, Urbanspoon, TripAdvisor and other review sites. Google takes this one step further. A search on Google or Google Maps embeds a link for “Google reviews” within the listing for your own website. Often, friends and acquaintances comment on their dining experience on Facebook or their blogs.

Online reviews are particularly influential in the restaurant industry. More consumers (61 percent) have read online reviews about restaurants than any of the other 18 business categories listed in Brightlocal’s Consumer Review Survey 2013. Almost twice as many consumers reported reading restaurant reviews compared to doctor/dentist reviews, the next popular category.

Simply put: Online reviews can help make or break your business. Harvard Business School Professor Michael Luca found that a one-star increase in a Yelp rating leads to a 5 to 9 percent bump in revenue. Luca’s findings are based on the sales of Seattle restaurants in 2003, before the emergence of Yelp in 2004 through 2009. The impact is greatest for independent restaurants, with their market share increasing as Yelp usage increased. The research seems to indicate that online reviews can raise the profile of independent eateries, spreading the world about little-known gems.

Restaurants with an extra half-star rating on Yelp are more likely to be fully booked, according to a 2012 study by the University of California, Berkeley. The study looked at competing local restaurants that have a ratings difference of a half star and found that those with the higher score were fully booked 1.5 times as often as restaurants with the lower score. “Our study concluded that getting higher Yelp reviews actually caused restaurant to be more likely to be fully booked,” says co-author Michael Anderson, an associate professor of agricultural and resource economics. “The effects we estimated were not simply an artifact of the fact that better reviewed restaurants tend to be popular.”

With so much riding on your online reputation, it’s important to understand the ins-and-outs of this new word of mouth.

In the New Orleans area, another review site is emerging—FoodDat. A locally-owned food site dedicated to the restaurants, chefs and food scene in New Orleans, foodies can leave and read restaurant reviews, book reservations and upload food photos in live time using hashtag #fooddat via Instagram, search for recipes, food events, restaurant contact info and more. Each restaurant receives a complimentary, dedicated page on Fooddat.com and it can be enhanced with photos, video, recipes, chef spotlight, reservation module and numerous links to their social media channels.

The NRA’s new Guide for Managing Your Restaurant’s Reputation on Online Review Sites is designed to help you optimize your presence on review sites. The guide provides tips on everything from how to harness the marketing power of review sites to how to deal with dreaded negative reviews. The NRA has gone to the review sites themselves, as well as to restaurants leveraging this new medium, for answers to some of your most pressing questions.

If you would like to receive a copy of the Guide, please call the Louisiana Restaurant Association Communications Department at (504) 454-2277.