Study Shows How Reviews Affect Paid Search Conversion Rates

Mastering the art of online reviews is challenging. If you want to get reviews, you have to ask. If you want to get great reviews, you have to be specific about how you ask. And if you want to convey your commitment to customer service, you have to regularly respond to reviews. The bottom line is that it takes a lot of effort to manage your reputation through reviews.

So, is it really worth it to put in all that work just to get better reviews? And can high-quality reviews lead to more sales?

Digital marketing agency Location3 was also curious about the influence reviews could have, specifically when it came to paid advertising. They wanted to see if there was a correlation between quality of user reviews, replies to reviews and paid search performance. So, the company spent six months studying AdWords campaign data before compiling the results.

Here’s what they found.

In Location3’s study , it was discovered that higher star ratings do, in fact, lead to higher paid search performance. Not surprising. The results showed that the higher the star rating is, the higher the conversion rate grows.

• Reviews with lower ratings (average of 3.31 stars) had a conversion rate of 10.42%.
  
• Reviews with higher ratings (average of 4.96 stars) had a conversion rate of 12.83%.
  

That’s a 23% increase in conversion rate!

However...

Interestingly, there seems to be a drop in conversion rates when star ratings become too close to a 5.0 rating. Location3 found that an average 4.65 star rating saw almost 14% conversion rate, while a 4.96 star rating dropped down to 12.8% conversion rate. This means that there was a higher conversion rate for a slightly-less-than-perfect star rating.

The question is, why ?

Although the study doesn’t touch on this, we have a theory. We’ve discussed previouslyhow another studyhas found that the ideal star rating is between 4.2 and 4.5, because it is more realistic than a perfect 5.0 rating. If a company has all 5-star reviews, it starts to look suspicious, and consumers start to wonder if the reviews are fake. Therefore, a rating that’s still higher than 4.0 but lower than 5.0 is the sweet spot for reviews.

This study just goes to show that perfect ratings shouldn’t be your sole focus.

Another area Location3 looked at was how replies to the review affected paid search performance. Some businesses take the time to respond to reviews , while others simply let reviews stand as is. This study looked at whether there was a correlation, and if replying to reviews makes a difference.

The verdict: Yes, it makes a difference.

• Businesses with the highest reply rate (8.13%) averaged a conversion rate of 13.86%.
  
• Businesses with the lowest reply rate (5.73%) averaged a conversion rate of 10.42%.
  

It was found that there is a strong relationship between replies (both the number of replies and the reply rate) and conversion rate in paid search results. This means that the more businesses respond to reviews, the more conversions they get in paid search results. It pays off to be appreciative of your customers.

While it might not surprise you that getting high-quality reviews and responding to customer reviews has the potential to improve your reputation, we can now say with certainty that they also have the power to increase conversion rates in paid search results. If you were looking for further evidence that reviews are crucialto your digital marketing efforts, consider these results exhibit A.