The customer is NOT always right: Business strikes backwith user reviews

Story highlights

From holidays and restaurants to cab rides and flat shares, business is increasingly driven by peerreviews

For employees, peer reviews put appraisals into the hands of customers rather than bosses

TrustYou aggregates peer reviews for more than 250 hospitality industry websites

It says that peer reviews are now the No.1 factor in influencing consumer choices

In business, it might pay to keep the customer happy, but how far should you go just to keep thepeace?

Thanks to new technology, a bad review now cuts both ways and the peer review is increasingly afeature of everything from holidays and restaurants to cab rides and flat shares.

For Bereket Hagos, who drives an Uber car in central London, the two-way street of peer reviewshas democratized a process that was normally arbitrated by employers.

"You just deal directly with the customer and that means there's real respect," he told CNN.

Uber runs a five-star rating system for both drivers and customers, which Hagos says has a tendencyto keep the reviews honest.

"My rating is 4.66 out of 5, which is good -- for me that's absolutely beautiful!" he says. "You can'texpect 5 all the time because, of course, you meet a lot of people."

Reviews, too, have a subjective basis and Hagos says a driver or a passenger's reputation can bedamaged unfairly. A difficult customer, he says, isn't necessarily difficult all the time.

"I personally will pick up passengers with a low rating because I simply don't like to ignore people,"he said. "When I've picked them up, I've found them to be perfectly nice."

Online customer reviews are now big business and, according to Margaret Ady of TrustYou, acompany that tracks and aggregates reviews in the hospitality industry, online opinion is now theNo.1 factor in influencing consumer choices.

"It has a huge impact. It's become the most trustworthy source of information for most travelers andpeer reviews are really driving bookings," Ady told CNN.

"We've found that 65 per cent of travelers won't even book a hotel if it hasn't had a review writtenabout it."

Peer reviews have now changed the marketing landscape for hotels, restaurants and holidaydestinations.

"In many cases, they're beginning to make the old star rating for hotels obsolete," she said. "Thereare still different expectations for different price categories but it's easier to look at reviews and seewhat people are saying and to make your booking decision based on that.

"It gives it more texture and for many people it's just more trustworthy."

TrustYou works by collating thousands of reviews from more than 250 websites around the world,aggregates them and then runs them through a semantic algorithm to get an overview of the hotel,restaurant or destination.

Any outlying opinions -- either wildly positive or extremely negative -- are ironed out in theaggregate results produced by the company.

"What we're getting is exactly what the crowd is saying about a place," Ady said.

Responding to negative feedback is always a delicate operation for vendors and service providersand TrustYou says the professional reputation of a client often hinges on how it responds to a flamefrom a customer.

"We give them guidelines, saying acknowledge if there was a problem, explain the steps you aretaking to fix it and invite the guest back and explain that their stay next time will be much morecomfortable," Ady said.

"We encourage clients to get in touch with the complainant directly to see if anything needs to bediscussed.

"That tends to work pretty well. Although I have seen in the news some hotels that have not done agood job of this, luckily none of them were clients."

Online reviews are also becoming a powerful marketing tool for companies, with a spread ofopinions not only showing up the strengths and weaknesses of a given service provider but alsothose of its rivals.

TrustYou provides its clients with a monitoring tool that allows it to see what is being said about itsbusiness across all platforms and a dashboard that enables it to respond to every review beingwritten.

"Then they can see our semantic analysis, so they can see areas where they are doing well andshould be marketing along with areas that aren't doing so well and they need to improve," Ady said.

"They can also see their competitors too to see how they stack up or even get comparisons betweenhotels within their own chain."

While hotels and restaurants have been paying attention to online reviews for the past five or moreyears, Ady says it's only relatively recently that companies are starting to see them as a valuablemarketing tool.

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