Why negative reviews can be beneficial

Business Insights

Today, consumers use reviews to help them make decisions about more and more aspects of their lives. Whether it's purchasing a new financial services product or visiting a new hotel, people often turn to the feedback of others for reassurance. In fact, our research found that 84% of consumers trust reviews from other consumers. And 69% of consumers change their mind after reading reviews.*

While positive reviews can be a great promotional tool, less positive reviews are often seen as being damaging to a company's reputation. However, negative reviews can actually be turned into a positive. In this blog, I'll give three key reasons why negative reviews can actually be beneficial

Building trust and credibility

Firstly, while it may seem counterintuitive, bad reviews can actually help build a company's trust and credibility. When potential customers see a mix of positive and negative reviews, they're more likely to trust the authenticity of the reviews.

A company with only positive reviews may seem too good to be true, and customers may question the legitimacy of the feedback. On the other hand, a company with a mix of positive and negative reviews can be seen as more genuine and trustworthy.

Identifying improvements

Secondly, negative reviews show companies how they can improve. These reviews often highlight specific problems that customers have faced, giving companies valuable insights into how they can improve.

For example, a customer may wish to speak to their insurance company on the phone about a new policy. If they get stuck in a long call queue and give up trying to make contact, the company may never know about the difficulties that customer experienced. But if the customer shares their experience at a review site, the feedback could prompt the company to make improvements, leading to a better overall experience for everybody.

Giving companies the opportunity to respond

The third key reason why negative reviews can be beneficial is that they present companies with the opportunity to directly respond to customers and address their concerns. Responding to negative reviews shows that companies care about their customers and genuinely want to meet their needs.

When a company receives a negative review, they should respond quickly and avoid making excuses. Instead, acknowledge the customer's experience and offer a solution or apology. In the above example, the insurance company could respond by saying they listened to the feedback and put more resource into their customer service team. By taking this approach to negative feedback, companies show that they care and potentially turn a negative experience into a positive one. At Smart Money People, we automatically notify companies about new reviews, and give them the opportunity to directly respond.

By Jess Rushton, Head of Business Development, Smart Money People


By using bad reviews to identify areas for improvement and responding promptly and professionally, companies can turn negative experiences into positive ones, and even improve their overall reputation. So if your company receives a bad review – don't panic. Instead, see it as a chance to improve and show your customers that you care.

*Smart Money People research, October 2022