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The Impacts of Social Media

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Social Medias Impact on Consumer Behavior With today’s technology the use of social media has taken the world by storm, with millions of people able to rate, review and share opinions on products at the palm of their hands. The high usage of social media sites is creating a new medium for companies to communicate with consumers on a personal level they were not able to years ago. With the usage of smartphones sky rocketing consumers are now able give their “two cents” about products or services the second they experience them. This is an essential element for companies and consumers because social media allows them to view reactions about new products, whether they are negative or positive. Where would you like to eat tonight? Be daring and try the new bistro that just opened down the street or play it safe and go to Applebee’s? This could be one of the most daunting decisions someone may have to make throughout their day. When it comes to where one would like to spend their hard earned dollar on a meal 45% of consumers turn to leading social media sites like Yelp for recommendations (Pann). 57% of consumers rely on the reviews from these sites on restaurants to determine where they will dine that night (Pann). But how reliable are these reviews that consumers are putting such high importance when it comes to their dining experiences? When it comes to the reviews on websites such as Yelp, a recent study by Gartner a tech research company has determined by 2014 that 10% to 15% of reviews found on these sites are falsified (Pann). These falsified reviews are hurting the reputation of social media review sites because if consumers are not able to trust the information found on these websites then there is no value in the reviews and these sites. For a company like Yelp who has stated on their home page “Real People. Real Reviews” this goes against everything they are trying to promote. Businesses are negatively effecting the reputation of sites like Yelp towards a motto of “Paid People. Fake Reviews.”. Companies know the high importance consumer reviews play in the decision making process, that is why many companies are paying for five star reviews to falsely boost the ratings of their business on review sites. In February of 2011 a case was discovered that centered around this issue. The owner of a home improvement company in Texas was found posting advertisements online seeking a writer who could post 25 positive reviews on eight different popular consumer review sites (Weise). Efforts to boost sales through consumer reviews like this are becoming an issue for websites and consumers trust in these websites. A study has shown for some products or services up to 30% of the reviews posted on review sites can be fake (Weise). Social media review sites are making efforts to monitor the content on their websites and dispose of any falsified posts as quickly as possible. Companies such as Yelp must do this in order to maintain their valued reputation in consumers eyes for their reviews to remain profitable and trustworthy. Yelp is making efforts to warn their consumers of the falsified posts by paid businesses in a humorous way. Yelp is flagging company’s pages who have been caught paying someone to post a positive review with a notification stating “We caught someone red-handed trying to buy reviews”, which will remain on their page for 90 days (Fiegerman). Efforts like this are being made by many companies to keep review posts honest and reliable, since they know how much opinions mean to consumers and their purchasing behaviors. Widely known tech companies are sponsoring research to analyze popular websites review boards. Microsoft put $138,000 towards this type of research to study close to 6 million reviews on the popular online retailer Amazon.com (Weise). The researchers have discovered some trends among the fake posts found on the website. Some of the key signs of fake reviews found were duplicate reviews across a different number of similar products (Weise). The research also analyzed that members on these sites that post falsified reviews do not remain members on the sites for a long period of time (Weise). The prestigious University Cornell has also conducted a study on consumer’s ability to decipher what reviews are actually legit. They have concluded that consumers believe they are good at telling when someone is lying, but actually aren’t very good when put to the test (Weisbaum). Some steps consumers can take to avoid scams from fake reviewers are to look for reviews that seem to be over the top, and make the product or service seem perfect advising you should purchase it right now (Weisbaum). You should look for detail within the review, if the review just lists details about the product and not about the actual performance, reliability or overall value of the product it is often a falsified review (Weisbaum). When reading reviews about services such as hotels real reviews tend to talk about the psychical features of the space, refereeing to the nouns like “floor” and using adjectives such as “small”. The fake reviews focused more time talking about themselves, the reason they went on the trip, and the people they went with since they did not know what the hotel actually looked like (Weise)

When companies use social media sits such as Yelp the way they are intended to be used businesses can gain a great deal of valuable information from them. With nearly 78 million people visiting Yelps website per quarter businesses can take the data found from their reviews to improve their services (Pann). . Businesses using Yelp are now able to communicate with their costumers on a personal level they were not able to years ago. Reviewers can leave comments on a restaurants page describing their experience, reviewing the décor, service and the food. This is essential information to businesses because they now have firsthand recollections directly from their most valuable source, the consumer. Businesses can use these reviews to make changes to negative comments to improve their services and reputation.
Another feature Yelp offers that allows businesses to track their success is a tool that allows users to check in when they are at the business sharing this information to the users Facebook page. This feature counts the number of times people check in at a certain business, allowing businesses to track their repeat customer’s and their opinions. Yelp’s check in feature posting to Facebook is a valuable asset for any business, because it is a form of free advertisement for businesses. With the average person on Facebook having 245 friends, and so many people making their decisions based on other people’s opinions this is a huge advantage for any business (Tsukayama).
I personally use websites like Yelp to make decisions about what products or services to use. I think these websites provide good honest insights into what you can expect at a business majority of the time. I think these sights allow for companies to discover and adjust problems much quicker than the traditional approach, which is a huge advantage for any company. A company using false reviews like the ones listed above is one of the disadvantages social media sites like Yelp can have for competing businesses. Many companies work hard to earn their outstanding five star reputation and people paying for false adds diminishes the quality of their work and the reliability of a site such as Yelp has for consumers. Consumers must keep in the back of their mind that “You can’t always believe what you read online” when reviewing products or services on popular review sites. References 1. Pann, Joann. "Mashable." Mashable. N.p., 20 Sept. 2012. Web. 24 Apr. 2013. <http://mashable.com/2012/09/20/fake-online-reviews/>. 2. Fiegerman, Seth. "Mashable." Mashable. N.p., 18 Oct. 2012. Web. 24 Apr. 2013. <http://mashable.com/2012/10/18/yelp-fake-reviews/>. 3. Pann, Joann. "Mashable." Mashable. N.p., 4 May 2012. Web. 24 Apr. 2013. <http://mashable.com/2012/05/14/technology-in-restaurants/>. 4. Weise, Karen. "A Lie Detector Test for Online Reviewers." Business Week. N.p., 29 Sept. 2011. Web. 24 Apr. 2013. <http://www.businessweek.com/magazine/a-lie-detector-test-for-online-reviewers-09292011.html>. 5. Weisbaum, Herb. "How to Spot Fake Online Product Reviews." NBC News. N.p., n.d. Web. 24 Apr. 2013. <http://www.nbcnews.com/business/how-spot-fake-online-product-reviews-1C7100886>. 6. Tsukayama, Hayley. "Your Facebook Friends Have More Friends than You." Washington Post. N.p., 03 Feb. 2012. Web. 24 Apr. 2013. <http://articles.washingtonpost.com/2012-02-03/business/35444265_1_facebook-users-photo-tags-friend-requests>.

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