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Who Is Angie?
Read this article in PDF form here.
And Why Should You Be On Her List?
By Jan Norman
Would it be a blessing or a business killer if the whole world knew what your customers thought of your micro-business?
In the social media age, the question isn’t if, but in what format, people tell others what they think of your company.
There are literally millions of websites, blogs and articles online that carry information and reviews about businesses, products and services.
To get an idea of what you—as a micro-business owner—face, let’s look at just four of the popular consumer/business websites:
1. Angie’s List
2. Service Magic
3. Yelp
4. The Better Business Bureau
Each has a different business model as well as benefits and drawbacks for micro-business owners who are trying to differentiate their companies and attract customers in a crowded marketplace.
Understanding how these four well-known sites work can help you evaluate other sites built on similar models.
How They Work
The Better Business Bureau is the oldest of these business rating sites.
Founded in 1912, the Council of Better Business Bureaus is the umbrella for more than 120 locally-owned, independent franchises. The bureau gives A+ to F grades to millions of businesses. It also offers mediation services when a customer and business have a dispute.
Access to these ratings is free online at the Better Business Bureau.
Angie’s List has an ever-growing database of mostly service businesses and medical professionals in 500 categories, with consumer reviews written by more than a million dues-paying members. The company says it gets 40,000 new reviews a month at the site.
Service Magic pre-screens licensed contractors and some services such as photographers. Consumers then visit the site, input their needs and receive three to four referrals. The businesses pay for each referral they get.
Yelp combines user reviews, social networking and local search. Businesses can be listed for free. And the site doesn’t charge users to write a review. Yelp makes its money by charging companies for better placement in search results and for extra features in their listings.
What They Cost
The Better Business Bureau doesn’t have members. Instead, businesses are accredited for an annual fee that’s determined by company size and location.
For example, the Louisville bureau charges $405 for a business with one to three employees and $3,500 for companies with 1,500-plus employees. The Greater Maryland bureau charges $399 a year for one to two employees and $6,635 for 1,251 to 2,500 employees. Dispute mediation fees also vary.
The Better Business Bureau allows a business to promote its accreditation, which is seen by many consumers as a Good Housekeeping Seal of Approval for businesses.
On Angie’s List only consumers who pay about $5 a month are allowed to write reviews, which the company says improves the quality of the comments. Businesses can respond to their reviews for free. If a company has at least two A or B ratings, the owner can buy ads on the site.
Service Magic charges its contractors referral fees of $7 to $50 per lead, depending on the type and size of a job.
Yelp listing enhancements can run $300 a month, according to micro-business owners who have tried them.
How To Maximize Benefits
“Recent statistics have proved that consumers are reviewing and conversing about businesses,” says Manal Richa of MarCom Network, a marketing and creative agency in Irvine, Calif.
“So for business owners it would be best to be online, to connect with consumers and prospects, answer their questions and comment on their reviews.”
The Better Business Bureau has influence with millions of Americans and Canadians, so a business that receives a notice of a complaint from the bureau should respond immediately and completely. One unanswered complaint can draw an F grade.
Any business that pays for accreditation should use the BBB symbol in an area visible to the public, such as on websites, in marketing materials and at storefronts.
To get the most out of Angie’s List and Yelp, business owners should encourage customers to post reviews about their companies, products and services. Owner should also participate and respond using the social networking aspects of each site.
Watch For Pitfalls
Many consumers think the Better Business Bureau is a sterling consumer protection advocate. After they find out that the bureau charges businesses for accreditation, some lose trust in the whole process.
Also, many people see the Better Business Bureau as becoming irrelevant as social media and business review sites gain traction with consumers.
Angie’s List says it verifies reviews to make sure companies aren’t “stuffing the ballot box.” But business owners have reported getting around the verification by using email addresses and contact information under different names.
For consumers, Service Magic’s database of businesses may be thin in some categories and communities. Some business owners complain that consumers give bogus contact information or seek free tips and then don’t sign a contract.
Yelp is strong in such metro areas as New York City and Los Angeles, but not in many small communities. Although 85 percent of its reviews are positive, the site has been criticized for unfair negative reviews, sometimes written anonymously and—some owners claim—by competitors. Yelp won’t censor the reviews.
Next Steps
If your micro-business hasn’t yet made the leap into social media review sites, you need to jump in soon.
Take time to visit the sites. Look at listings for companies similar to yours in size, industry and geographic location. What kind of ratings and reviews are they getting? What kind of feedback are they giving to consumers?
If you’re not sure that Angie’s List or a similar site is right for your business and your budget, talk to other business owners. Find out whether paying for placements and/or referrals generates leads or sales or both.
Writer Jan Norman knows the importance of social media for small businesses. Read her blog at The Orange County Register.
- Participation in seminars and conferences that support the growth of your business
- Training courses for business certifications and licensing
- College or university courses, either online or through a local institution
Read this article in PDF form here.