According to research by Bright Local, 85% of consumers trust online reviews as much as in-person recommendations. Most businesses today know the importance of their digital reputation and effective online reputation management, but putting this into hard numbers is more challenging. If you’re making the case for focused reputation management for your business or your client, you need to know online reputation management ROI. Logically, you assume digital reputation improvements mean revenue increases, but by how much?

How to Measure the ROI of Online Reputation Management

Overall, online reputation management means creating more positive, trustworthy sentiment around your brand, and removing or displacing negative sentiment. This sentiment comes from three main areas online; social media, referrals, and review sites. We’ll address the ROI of each of these online reputation management strategies individually. This way you can tackle them one by one, or pick and choose the areas that are most important to your business or your client.

Social Media

Social media is a big part of online reputation management for many people, businesses and brands. And even if you don’t use social media, your customers and potential customers do. That means you’re probably getting mentioned—either positive or negative—whether you see them or not.

To measure the ROI of online reputation management in social media, you first need a baseline. There are a few different KPIs you can choose to get a starting social media score.

  • Followers: Whether you’re looking at Facebook, Twitter, Instagram or another platform, followers are a fairly good indicator of customer approval on social media. According to Sprout Social, your followers are about 57% more likely to be customers. Keep in mind that bots and other businesses will skew your organic follower numbers somewhat.
  • Engagement: Likes, retweets, reposts, mentions, comments and other types of engagement are also a measure of social media approval. This, like followers, is a fairly easy number to gauge, and requires only basic social media monitoring services. However, remember that not all engagement is positive.
  • Sentiment: This may be the most difficult social media KPI to measure, but it’s also the most accurate assessment of online reputation management on social media. If your total mentions and engagement is relatively low, you can skim through your mentions to get an average, or set up keyword filters including your brand name and positive or negative words. Social media management programs like Hootsuite or Sprout Social also have special algorithms to measure the public’s view of your company on social media.
  • Traffic: The total website or store traffic you get from social media isn’t a direct link to your social reputation. However, it is an important metric for measuring ROI. This means you’ll want to measure traffic from social alongside one or more of the previous three reputation indicators. You might use tracking codes, link click-through rates, or Google Analytics to measure your traffic from social media.

If your social score could use some improvement, devise an online reputation management campaign on social. You might hire an agency or new staff person to respond to mentions and solve problems, work with influencers online to improve your image, or make a focused social media campaign around a hashtag or trend. Determine how much this campaign will cost.

You can measure the ROI of online reputation management through social media using improvements to your traffic and social score. For example, if your engagement grew 100%, traffic from social media increased 50% and your average conversion rate is 5%, total sales increased by 2.5%. This also indicates that an 100% increase in engagement means a 2.5% in sales. To measure your ROI, divide this increase in sales by the total amount spent for online reputation management.

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Referrals

Referrals are less noticeable because they are generally not searchable, like reviews, and they’re not public, like social media. However, research shows that consumers are 4 times more likely to buy when they receive a referral from a friend.

If you have a high customer churn, referrals might not be a relevant online reputation management strategy for you. However, if you have a smaller group of loyal, satisfied, repeat customers, referrals are very important.

Just like social media, you’ll need a referral baseline before you can measure ROI of this online reputation management strategy. Also like social media, there are a few methods you can use to do this.

  • Referral links: When a customer completes a purchase and you send them a follow-up email, send a link that they can share with friends. You can measure the click-through rates on the link itself, or leads from a referral page.
  • Satisfaction survey: Ask your customers how they feel about your business and brand. Specifically, ask if they would recommend your company to a friend. This is metric is also known as your Net Promoter Score.
  • Referral Program: Incentivize your customer and their contacts with a referral program. Track how many existing and new customers take part.

If you don’t currently have referrals or if your Net Promoter Score is low, you’ll need a strategy for improving it. Or, if customers are unlikely to refer you, ask about their buying experience, and address any problems. If customers would refer you, but aren’t, make it easy for them to spread the word, and give them incentive. Advertise your referral program as well. Determine how much these efforts will cost.

To determine the ROI of this online reputation management strategy, track the sales from referral links, landing pages, or programs. Lifetime customer value will also be an important factor. Some estimates say lifetime referred customer value is about 16% higher than other customers. Along with sales, you’ll want to reassess your Net Promoter Score with another survey after executing your reputation management strategy. Just as before, divide your total increase in sales by the amount you spent to find the ROI of this online reputation management strategy.

Review Sites

For some businesses, such as restaurants, contractors, or dentists, review sites will play the most important part in online reputation management. Measuring the ROI of this online reputation management strategy is more difficult since you can’t track these sites or directly measure their effect. However, research and data projections can offer some guidance.

A study by Harvard Business School showed that local businesses that increased their overall review rating by one star saw an 5 to 9% increase in revenue. With this data you can estimate ROI from increasing your star-rating on popular review sites like Google or Yelp. Divide a projected increase in revenue by the amount you will spend on improving your reviews to get ROI. Use the following formula to get an cautiously optimistic estimate. You could also substitute .07 with .05 or .09 to get a low or high estimate, respectively.

[Original Revenue x .07] – Original Revenue = Revenue Increase
Revenue Increase / Total spent = ROI

Start with a modest goal of a one-star improvement. If you have just a few reviews, it won’t take many five-star experiences to make a significant impact. Read your reviews and address any problems that come up frequently. If you believe a competitor or someone else is posting fake reviews about you, contact the site or respond to the review and explain the situation. Encourage customers to post reviews, but remember to stay within legal guidelines and the site’s rules.

Other Content

In some cases, you may have other content to contend with, like blog posts, news items, watchdog websites like Ripoff Report or Consumer Affairs, or even competitor sites. If negative articles like these are high on search results, you should consider this a top priority in online reputation management.

The effect of negative articles depends mostly on how trustworthy the source is and how easy it is to find. If the source is well established and the article is on the first page of search results when you search for your company name or related terms, the effect can be very noticeable. According to Moz, one negative article indicates a 22% customer loss, and two means losing almost half.

Keep in mind that these aren’t just bad reviews by unhappy customers. These are bloggers, journalists, or other writers who went out of their way to either reveal a real problem or defame your business. If the story is untrue, consider taking legal action with a libel case. If the story is true and you’ve fixed the problem, address it, and then work at repairing your reputation.

Estimating the ROI on this online reputation management strategy is fairly straight forward. If you can remove or displace the negative article from the first page of results, you can estimate a 22% traffic increase. If this also boosts your own website to a higher spot in the search engine results page (SERP), you can expect additional traffic increases. From there, apply your conversion rates and sales to get your ROI.


Your online reputation is affecting your business, whether you’re aware of it or not. The first step to mending your online reputation is fixing the problem, whether that’s customer experience, product quality, or libelous competitors. The next step is making a repair plan, and executing it in a way that supports ROI. With an online reputation management strategy that is ethically and financially responsible, you can bring in loyal, lifelong customers for years to come.

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