How Online Reviews Provide Social Proof


00:00 So as I was presenting just the other week, you know, I kind of had this epiphany, this light bulb moment, right? And you've probably gotten those before and people were asking me, well, why do online reviews matter? And I thought to myself, hmm, let me give a good example to this audience. Then I thought, hey, have you ever driven into the parking lot of a restaurant? Could be a pizza place, Chinese restaurant, Italian restaurant, doesn't matter, any kind of restaurant. And there were only three cars there? Right away, you knew that those three cars belong to the cook, the manager and one of the servers on staff or the bartender. So really it was the three people working there and there was no one else there. No diners whatsoever. Well, that is basically the simplest form of social proof. When I drive into that empty parking lot, there's social proof that this restaurant is not good.

00:50 Right? And I'm talking, you're driving in at six or seven at night, it's dinnertime. It's prime time and there's no one there. What happens is you're not seeing any social proof that people are dining there, that they enjoy the experience, the ambiance or the food. In your gut, you get this feeling that this isn't a good choice, I'm going to pull a u-turn, turn around and go somewhere else. So social proof is what really drives this power of online reviews, and when we're looking online and we're researching a business, we want to see social proof, so we want to see how other customers, other leads and prospects of this business like us have experienced the business. How they've experienced the products and services, and ultimately how the overall the overarching experience was because that's what they're giving a rating or review on. So if I'm seeing a bunch of 4- and 5-star reviews on a business, then I know that this is a good business. I have social proof! Whereas I'm seeing 1- and 2-stars, I'm a little apprehensive there, right? And nearly 90 percent of consumers are apprehensive to do business if they see negative reviews. Again, that's social proof! So what I want you to take away from this is the idea that social proof is what drives online reviews, and that's why online reviews are so important to your business. I hope this helps.

Bryan Caplan