The following is an excerpt from Rob Fuggetta's forthcoming book about Brand Advocates. One negative review can cost you 30 customers, a study by Convergys found. Using the Convergys research as the baseline, you can see how much one negative review costs a small resort hotel in Orlando, Fla.
If your average revenues per customer are higher, negative reviews cost you more. One negative review costs a high-end fitness club $72,000, as the chart below shows.
Social Media Whup-Ass
This is a conservative estimate of the amount of money you can lose from negative reviews. It only focuses on lost sales. It doesn’t take into consideration the lasting financial impact of negative reviews on your company or brand’s reputation.
Also, it doesn’t take into consideration other ways Detractors spread negative Word of Mouth, like email, social channels, and offline.
In the old days, PR people would tell their clients who wanted to battle newspaper editors, “Don’t pick a fight with a man who buys ink by the barrel.”
Today that man is the social consumer, and he’s got a barrel of social media whup-ass for you.
Read more excerpts from Rob's forthcoming book here.