Why you should (or shouldn’t) pay for positive reviews
While some argue that there’s nothing wrong with rewarding customers with a gift card, cash or a discount for going online to review a company, others see the practice as unethical.
Here are some of the pros and cons of soliciting reviews.
PROS Rewarding clients for online reviews is a natural progression from rewarding them for referrals, says Jeff Moeslein, president of Legacy Remodeling in Pittsburgh. A page on Legacy’s website introduces clients to the Google, Angie’s List and Yelp review processes. Positive reviews are acknowledged with a $25 gift card. Moeslein reads every review and forwards it to the appropriate team member.
If you don’t do it, you miss out. Companies such as vPunch, an electronic loyalty program, make it easy to reward clients for writing online reviews. VPunch business clients register customers for a vPunch account. Online reviews flow through the vPunch website, as does transaction activity. vPunch posts the review on a review site or via social media. The review is another way to earn rewards in the form of “virtual money,” i.e., future discounts.
CONS Professionals shouldn’t need this practice. Last year 15 of the 40 jobs undertaken by Harris Construction & Woodworking in Poway, Calif., directly resulted from remarks posted about the company on Yelp. Owner James Harris says all he did to make that happen was to let clients know that he is on Yelp. They do the rest. “From a customer’s standpoint, a review that’s solicited or paid for lacks credibility,” he says.
Moreover, it’s palm greasing. Brand expert and author Rob Fuggetta, president of Zuberance in San Carlos, Calif., cites several reasons, including new Federal Trade Commission guidelines directing reviewers who are paid to state as such. “Authenticity is important,” he says, “and … the results are better when you don’t pay.” Zuberance has generated more than 30 million online reviews, including tweets and blog posts, for clients, “and not a single advocate has received a dime.”You’ll get flagged. Morgan Remmers, manager of Yelp’s local business outreach, says that the company’s policy is to “discourage solicitation or reward” of online reviews as these create bias because businesses only steer happy customers there. Such reviews violate Yelp’s terms of service.
When online comments get nasty
It’s bad enough when a disgruntled homeowner posts that your company doesn’t return phone calls, or worse, does slipshod work. But what if they accuse you of a felon? That’s what happened in last year’s widely publicized case involving Washington, D.C., home remodeling contractor Christopher Dietz. Dietz didn’t stop at responding online; he has sued former client Jane Perez for her comments on Angie’s List and Yelp. According to a December 2012 article in the Washington Post, Dietz is seeking $750,000 in damages for defamation from Perez, who claims, among other charges, that Dietz did poor quality work and even stole her jewelry. Dietz figures the bad publicity has already cost him $300,000 in lost work.
A judge ordered Perez to remove certain claims she had made in her online posts while the defamation suit is pending. According to the Washington Post, “free speech advocates see the suits as attempts to stifle valuable consumer information, while business owners say they are forced to fight back because a false post can reach around the world on the Web” — a sentiment shared by Dietz, who concludes, “Even if I win the monetary award … I’ve still lost.”
Friendly recommendation
As many as one-third of all online reviews are fake, according to industry experts. At some point, consumers may decide that they just don’t trust what’s written, leaving room for a new type of review site.
Surveys show that the overwhelming majority of people believe word-of-mouth reviews, so why bother with online feedback that could be phony or come from a stranger when you can get a review from a friend?
The new review sites Porch and YouNeedMyGuy link through social media to help consumers find contractors that their personal contacts have used.
Seattle-based Porch, which has a national rollout scheduled for midsummer, focuses on home care professionals, from remodelers to landscape maintanence companies.
The service is free for consumers, who can browse project images and use an educational component to help them make informed decisions. Professionals can create a “Free” profile or opt for a “Partner” profile, which typically receives four times as many leads. They then pay a finder’s fee when they get new business from Porch (the fee is about 5 percent but depends on profession and project size).
On YouNeedMyGuy, a consumer creates a profile that links to a social media platform of their choosing. If, for example, he’s looking for a pool builder, several names appear along with details about who has reviewed the company.
The more people the consumer knows who reviewed the business, the higher ranked the business will be. Since the system is based on personal connections, even small companies have the chance to rank No. 1.
A business cannot buy a top spot. Business owners can create a basic profile for free, although there are other options: $45 for six months of Premium membership with an enhanced profile that includes video, photos, better contact and search result options, and real-time social media leads for the consumer.
I heart Angie (not?)
There is a whole nest of ethical and practical issues that cause contractors to be suspicious, frustrated and angry with Angie’s List. Stories abound about the difficulties of getting rid of negative reviews and about aggressive advertising tactics, especially since Angie’s went public in 2011.
Angie’s List had a net loss of nearly $53 million in 2012 and has not made a profit since its inception. Contractors report that since going public, Angie’s List employees have been more aggressive in getting them to advertise, in collecting payment, and in seeking reviews from current and former clients. “[Angie’s List] called a client we [did] a job for six years ago,” says Terry Stamman, owner of Twin Cities Siding Professionals in Minneapolis.
As a result of the call, the former client wrote a negative review. “We don’t even have the same employees we had six years ago,” he adds.
Contractors don’t have to pay to be on Angie’s, but they do have to pay to advertise. Service provider advertising is 69 percent of Angie’s total revenue, up from 57 percent in 2010. Consumer membership revenue declined from 43 percent in 2010 to 31 percent of total revenue in 2012.
When Angie’s List is new to an area (currently it’s in 219 markets), membership fees are low; in more established markets, joining costs more. Similarly, when a contractor buys advertising, the price depends on the number of people in that company’s market. Contractors don’t have to advertise, but if they do, they must offer Angie’s List members a discount.
By taking money from both sides, “Angie’s List is doing a disservice to both contractors and consumers,” says Darren Slaughter, a media consultant to the home improvement industry. In an online video titled, “Why I Hate Angie’s List for Contractors,” he stresses that for a consumer-advocate site to charge a membership fee to consumers is fine, just as it’s okay for a contractor-advocate site to charge a fee to contractors. But “to double-dip … you’re only serving one master — yourself.”
Despite the issues, many contractors are sticking with Angie’s, but several we spoke with do it reluctantly.
Pool and spa professionals are well aware that consumers frequently use review sites such as Angie’s List and Yelp. From the business owner’s standpoint, it works well as long as the reviews are positive. But as too many businesses have learned, even a single negative comment online can cause headaches. It doesn’t matter whether the complaint is accurate; the fact is, when you see a negative post about your company, it feels like the damage has been done. While most review sites make it possible to write a rebuttal, there are typically strings attached. So what should you do?
For this article, we spoke with pool and spa industry professionals as well as a variety of home improvement and maintenance contractors about their experiences with online reviews. While their opinions ran the gamut, in general, contractors serving higher-end markets are less affected overall by online reviews, while field technicians and repair personnel are more vulnerable.
Out of the blue
Pete Lucey had never heard of Angie’s List when he was notified by the service that someone had posted a negative review about his company, Delaware Valley Pool Supply, in Aldan, Pa. The complaint stated that Lucey hadn’t fixed the leak he had come to repair and the customer wrote that she should have been charged less.
“I had explained to the woman that it was a two- or three-step process to troubleshoot the leak,” says Lucey, “and here Angie’s List was telling me I had to defend myself — to take time out of my day to try to explain what I do as a technician to people who have no idea.”
Lucey posted a response, and Angie’s List staff declared the episode a “stalemate.” The customer never paid her bill, and the complaint has since been removed. In another episode, a man complained on Yelp that Lucey’s store was rude because they declined to guide him through a do-it-yourself installation of a pump that he had purchased from the Internet. The store did not respond, and the original complaint has been “filtered” by Yelp, indicating that it is suspect.
“If we were getting complaints all the time, that would tell you something, but we’re not; those are the only two in the last ten years,” Lucey explains.
His company has been doing business in the same area for 30 years, serving both residential and commercial customers. They have no plans to develop a presence on either Angie’s List or Yelp, and will continue to focus their Internet marketing efforts on maintaining a high-quality web site.
Straight A’s
Mike Durand, owner of Classic Spa Service in Torrance, Calif., has had a much better experience with both Yelp and Angie’s List. “I think reviews are a good way to keep the industry honest and fair,” he says. “There are so many spa guys out there taking advantage of customers, that I used to wonder how they stayed in business. So now, especially with Yelp, people can go in and rate businesses, and I can see that it’s made a big difference — people don’t stand for being pushed around.”
Durand has premium ratings on Angie’s List and Yelp but, he says, “I’ve paid nobody anything,” referring to the advertising programs that both services offer. “Yelp has come to me and said for $350 a month, they can help me ‘get out there,’ as they put it, but I don’t need it.”
Durand has a website full of customer testimonials, as well as personal letters and news articles dating back to the 1980’s, establishing how long he’s been in business.
Standing out
John Divine is a plumbing contractor in Charlotte, N.C.; he has been on Angie’s List since 1999, and has won its Super Service Award every year since 2005. Divine sees Angie’s List as an important source of good leads. “I realize this is an Internet world and people are going to Angie’s List. If I want the lead, I need to show up at the top of that list of plumbing contractors, so I’m willing to pay for the premium placement.” Divine has allocated a large portion of his advertising budget to Angie’s List. He finds that many of the consumers using the service in his area are well-educated and financially stable, and that customers who originally found him there tend to lead to referral jobs. Overall, Divine has found Angie’s List helpful, but he’s aware that the cost of his leads is high.
Divine occasionally gets a negative comment, and he always tries to respond courteously.
“I recently responded to an off-the-wall negative comment, and I had [another] customer tell me that he loved my response, that it made sense and was not extreme, and that’s why he was hiring me.”
Dan Wolt, owner of Zen Windows in Columbus, Ohio, also likes the quality of his Angie’s List leads, saying that “they are far and away the best; they are gold.” Because his company gets consistently high reviews, Wolt says that often, when he gets in touch with a prospect from Angie’s List, they buy from him straight away based solely on his Angie’s ratings.
Like Divine, Wolt spends a good portion of his marketing dollars on Angie’s List, running “Big Deals” and paying to advertise his Super Service Award wins. “It goes to 78,000 people and it’s a full page and costs $500. I make $500 off four windows; how would I turn this down?” he says.
Should you play the game?
Conventional wisdom holds that much of what’s on the Web is worth what you pay for it — nothing. Yet a 2012 survey of 2,862 Internet shoppers conducted by the website Search Engine Land found that a surprising 72 percent of those surveyed actually trust online reviews. On the other hand, according to Bing Liu, a data-mining expert from the University of Illinois at Chicago, as many as a third of all consumer reviews on the Internet are fake — that is, written by marketers or paid third-party services.
One such service, Ad Blaze, blatantly acknowledges the deception, publishing on its website that “we will write a professional review for your online listing. Each review will come from a unique IP address located in the city of your choice. … The reviews will be leaked at random times to look natural.” The site provides pricing and a shopping cart; five reviews can be had for $124.75. Ad Blaze further promises “no fake accounts or bots so your reputation is always safe. … You have unlimited revisions on the review so it will never be submitted until you approve of it.”
For honest business owners who have built their reputations by providing good service at fair prices, the idea that it’s necessary to adopt a different set of rules to survive in the Internet era may be hard to stomach. While reputable contractors will stop short of buying fake reviews, many see nothing wrong with rewarding customers with a gift card or a discount for posting a positive online review.
It’s a “natural progression” from rewarding clients for referrals, says Jeff Moeslein, of Legacy Remodeling in Pittsburgh. A page on Legacy’s website steps clients through the Google, Angie’s List, and Yelp review processes. Positive reviews are acknowledged with a $25 gift card.
“We don’t offer incentives for customers to write good reviews,” says Troy Christ, co-owner of Blue Bottom Pool and Spa Supply in Cedar Park, Texas. “It’s not necessary. Occasionally a happy customer will ask me, ‘Can I write a letter to your supervisor?’ I tell them thanks, I’m an owner, but that they can write something on Yelp if they want to. That’s as far as we go.” The company’s Yelp page has a number of positive reviews and one negative one, which Christ believes happened because a former employee in training exhibited a bad attitude at the sales counter. “Yelp doesn’t make it possible to remove a bad review, though we can respond,” says Christ. “We just left it alone, and it turned out another customer saw it and responded in our favor.”
Blue Bottom purchased a yearlong contract for marketing services from Yelp. In return, Yelp made a professional quality video about the company, which is posted on the company’s website and on its Yelp profile page. Though he believes the move has been helpful, Christ plans to reallocate those marketing dollars — around $4,200 annually — to a co-op television ad campaign partly paid for by the company’s largest supplier. “We’ll lose the video on our profile page, but will be able to keep it on our website. Plus we’ll have a series of new videos to draw from.”
Overall, Blue Bottom’s experience with Yelp has been largely positive. Most of the company’s new business comes from word-of-mouth referrals from existing customers, but “Yelp is the icing on the cake,” says Christ. “Someone will tell their neighbor about us, then that person will check us out on Yelp before coming in. If you spend half an hour with a customer for a $3 O-ring, that guy’s going to come back to you when his $500 pump goes out, because you took the time. Yelp brings them in the door, but our service brings them back.”
Portions of this article first appeared in Remodeling magazine. Freelance writer Don Jackson contributed to this version.