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Oct 24, 2011 · In order to establish causality between reviews and a restaurant's success, Luca took advantage of the fact that Yelp rounds its ratings to the nearest half-star-so, for example, a 3.26 rating would be rounded up to 3.5 stars, and a 3.24 rating would be rounded down to 3 stars.
Mar 27, 2017 · Online reviews can have a real, measurable impact on a restaurant’s bottom line. In order to understand how those stars affect restaurant-goers, we spoke to the experts – two economists, a...
Oct 4, 2011 · I present three findings about the impact of consumer reviews on the restaurant industry: (1) a one-star increase in Yelp rating leads to a 5 percent to 9 percent increase in revenue, (2) this effect is driven by independent restaurants; ratings do not affect restaurants with chain affiliation, and (3) chain restaurants have declined in market ...
Sep 30, 2018 · Restaurants that are not accredited by experts sell out 27 percent more often if they earn an extra star on Yelp. According to the study, the closer the link between restaurants and customers through reviews, the greater the positive effects on business as a whole.
Apr 26, 2017 · That’s why it is crucial for restauranteurs to understand the impact of review websites such as Yelp, Toptable or TripAdvisors and the role they play the success or downfall of a business. In a recent research report published by the experts at Website Builder, approximately 61 percent of customers have read online reviews about restaurants.
Oct 5, 2011 · The study, which set out to determine whether “online consumer reviews affect restaurant demand,” showed that Yelp has effectively formed a social network where people are encouraged to identify themselves and post descriptive reviews rather than vent, according to the Wall Street Journal’s SmartMoney blog.
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In a related study, Luca finds that a restaurant's average rating has a strong influence on sales. One additional Yelp star brings a sales growth of 5-9% in for independent restaurants. Looking at chain restaurants, consumers may have more information than for independent restaurants.
