A special report from Womply Research

How do online reviews impact revenue for auto service businesses?

If you've read our full report, you've already got a sense for just how important review sites are for local businesses. But what about local auto service businesses specifically? Are reviews more (or less) influential on revenue for auto repair shops, oil change businesses, tire shops, and other auto services than other types of local businesses?

Impact of Reviews on Revenue page masthead graphic. A special report from Womply Research.

To understand the correlation between reviews and revenue for local auto services, Womply's data science team conducted an in-depth analysis of transactions and online review data for 17,000 auto service businesses in every state.

Key findings include

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Local auto services that don't claim their free listing on any review sites earn 26% less revenue

Auto service businesses that reply to 50% or more of their reviews earn 19% more than average

Auto services are more impervious to low ratings than other businesses—2.5 to 3 star businesses earn more than any other rating

Local auto service businesses with more than the average number of reviews bring in 13% more in annual revenue

Shops whose total number of reviews are 25-35% negative earn 26% more revenue than those whose are 0-5% negative

Go deeper by reading our analysis for businesses in a different industry.

Claiming free listings

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Auto service businesses that claim their listing on multiple review sites make more money

Key findings include

Auto service businesses that claim their free listings on at least 1 review site earn 13% more revenue

Auto service businesses that don't claim their listing on any review sites earn 26% less revenue

28% of auto service shops haven't claimed any review site profiles

Google is the most important free listing site for auto service businesses

The average annual revenue across all auto service businesses in our study was $312,000. As with all business in our study, claiming your profile on at least one review site correlated with more annual revenue.

Auto service businesses that don't claim their profile on one of the major listing sites earn 26% less revenue than the average auto service business. Meanwhile, claiming even one listing sees that increase jump all the way up to 13%.

When auto service shops claim their free listing on review sites, it gives them the ability to reply to reviews, add helpful information about their business, and plenty of other things that clearly make an impact on curious customers.

Auto services who have claimed multiple review site listings don't experience the same kind of increases in revenue as other industries, but it's still clear that this free and simple step is worthwhile for any auto service business owner.

More customers use Google Maps to look for nearby auto service shops than ever before. Which is a likely reason why auto service businesses who don't claim their Google listing experience the largest decrease in annual revenue.

No matter the review site, though, not claiming a listing correlates with a decrease in revenue from average, suggesting auto service shops should definitely claim their listing on every relevant review site.

Go deeper by reading our analysis for businesses in a different industry.

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Replying to reviews

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People spend more money at local auto service businesses that reply to reviews

Key findings include

76% of auto service businesses don't respond to any reviews

Auto services that reply to at least one review do so 25% of the time

Auto service shops that reply to reviews more than 25% of the time earn 13% more than average

Shops that don't reply to any reviews earn 3% less in annual revenue

It's clearly important for auto service businesses to claim their free review site listings, but a business owner shouldn't just stop there. Our analysis reveals that as customers search for local auto service shops, one of the things they're looking for is a business that engages with customer reviews.

76% of all auto service businesses in our analysis haven't responded to a single review, and those businesses earn 3% less in annual revenue.

Once businesses engage with their customers online by replying to reviews, though, revenue starts to go up. Auto service businesses who responded to just even just one review earn $18,000 more each year than the average auto service business.

As you can see in the charts above, auto service businesses that engage with their customers by replying to online reviews earn more revenue. Auto service businesses that reply to their reviews between 1 and 25% of the time earn 19% more revenue than average.

Interestingly, the increase in revenue stays the same even as auto service shops reply to 25% to 50% of their reviews, and drops slightly when the review rate raises to 50% or more.

This could be because busy auto service businesses with a large number of total reviews are more likely to earn more money than average, but are also much more likely to have a much lower review response percentage.

This becomes clear when you look at auto service business revenue by total number of review responses:

Auto service businesses that responded to at least 1 review responded to a total of 14 reviews on average.

Shops who respond to even just a handful of reviews earn more than the average shop, and revenue rises as total response count increases.

Auto service businesses who respond to 8 to 25 reviews earn a substantial 20% more than average, while those who respond to more than 50 earn a whopping $136,000 more each year than the average shop.

When it comes to responding to reviews, it's clear that auto service businesses should focus primarily on giving thoughtful and meaningful responses to both negative and positive reviews.

As we'll expand on in the sections below, getting more reviews is clearly important, but staying engaged with customers in a real and meaningful way can make a clear difference.

Go deeper by reading our analysis for businesses in a different industry.

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Star ratings

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How much does a auto service shop's star rating impact revenue?

Key findings include

Auto service businesses with a rating between 3.5 and 4.5 stars earn more revenue than any other rating

5 star shops earn less in revenue than 1 to 1.5 star shops

Locations with a 3.5 to 4 star rating earn 13% more in annual revenue than average

Only 5% of auto service businesses have lower than a 3-star rating

Now that we've covered the things that auto service business owner can control when it comes to review sites, let's get into the reviews themselves. We'll start with what many auto service business owners consider the most important part of their online presence—their overall star rating.

The chart below illustrates how much the average star rating matters to revenue at all auto service businesses.

The sweet spot for auto service businesses is from 3.5 stars to 4.5 stars, with 3.5 to 4 star businesses earning the highest average revenue.

Interestingly, auto service businesses appear to be less sensitive to ratings than other industries. Not only do auto service businesses with 1.5 to 1.9 star ratings actually earn more than the average, but auto service shops with good ratings typically experience a less drastic increase in revenue than other industries.

As with other industries, 5 star auto service locations also average far less revenue than the typical auto service shop. This is possibly because most 5-star rated auto service shops are less established, or may be guilty of black-hat practices like buying fake reviews.

Go deeper by reading our analysis for businesses in a different industry.

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Number of reviews

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How much does the number of reviews matter for auto service businesses?

Key findings include

Auto service shops with more than the industry average of 31 total reviews earn 13% more in annual revenue than average

Auto service shops with fewer than 31 total reviews earn 5% less in revenue than average

Locations with 100 reviews or more earn 26% more than the average

An above-average number of reviews on Google has the largest positive impact on revenue of all review sites

Auto service business owners often worry about their star rating, but as you can see in the section above, star rating has a more limited impact on revenue. On the other hand, our findings suggest that auto service business owners should perhaps focus much more on increasing the number of reviews than almost anything else.

Auto service businesses in our analysis averaged 32 reviews across all review sites. This is significantly less than the 82.5 average across all businesses, suggesting auto service businesses may need to work a little harder than other industries to get reviews.

We analyzed the revenue of businesses whose review counts fall above and below that average 32 review threshold.

The results of this analysis revealed a positive correlation between review count and sales revenue, although not quite as strong as for some other industries.

Auto service locations with more than the average number of reviews earn 13% more in annual revenue than businesses with review counts below the average. While this is quite a bit less than the increase experienced by small businesses across all industries, it's still clear that more reviews correlates with more money for auto service businesses.

This gets clearer when you take an even closer look at revenue by review count.

Auto service locations with 5 reviews or fewer earn 17% less than the average auto service shop. Revenue approaches average when auto service locations have a total of 11 to 31 reviews. And as total number of reviews goes up, so does average annual revenue.

Auto service businesses with 51 to 100 reviews earn 17% more, and those with more than 100 reviews earn 26% more than average, suggesting that a large number of reviews carries a lot of weight in the minds of customers searching for auto service businesses online.

When it comes to number of reviews on specific review sites, Google is the most important for auto service businesses. Auto service shops with an above-average review count on Google earn 19% more than the average business, while those without earn 5% less.

While Yelp and Facebook are less-popular platforms for auto service businesses, there's nothing but upside for auto service businesses who actively get reviews on those sites.

But regardless of the platform, local auto service shops would be well-advised to get as many reviews on as many sites as possible. Even if some of those are negative reviews (which isn't necessarily a bad thing, as we'll explain later in this report), there's little question that customers put more value in a higher number of reviews than they do in a 5-star rating.

Go deeper by reading our analysis for businesses in a different industry.

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Fresh vs stale reviews

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Fresh reviews are crucial for auto service businesses

Key findings include

Auto service businesses average 4 fresh reviews (posted in the last 90 days)

Locations with more than 4 fresh reviews earn 15% more than average

Auto service shops with no fresh reviews earn 8% less than average

Auto service businesses with 10 or more fresh reviews earn 26% more in annual revenue

The number of reviews an auto service business has on review sites is clearly important, but how important is the "freshness" of those reviews?

The average total number of fresh reviews, (reviews posted within the past 90 days) per auto service business in our analysis was 4. This is slightly lower than the average business across all industries, continuing the theme of auto service businesses receiving fewer consistent reviews than some other businesses.

We started by examining how much it impacted a auto service location's revenue if they'd received more or fewer than 4 reviews in the past 90 days, or if they'd received no new reviews at all.

As you can see, getting fresh reviews is extremely important for auto service businesses. Those who don't bring in any new reviews in the past 90 days earn 8% less revenue than average. Just a few fresh reviews helps, but those with a below average number of fresh reviews (1 to 4) still earn 3% less.

Getting more than the average number of new reviews, on the other hand, correlates with a 15% increase in revenue. Our hypothesis is that consumers put a premium on recent reviews and are more willing to patronize auto service businesses with lots of fresh customer feedback.

Let's take a closer look at auto service revenue by total number of fresh reviews.

Auto service businesses with just 3 to 5 fresh reviews earn close to average revenue, while those with 6 to 10 earn 12% more.

Auto service businesses with more than 20 fresh reviews, on the other hand, earn an impressive 26% more than the typical auto service business. Put another way, getting just 6 to 7 new reviews per month correlates to an extra $83,000 each year for local auto service shops.

The takeaway is that auto service businesses should focus on getting a steady stream of legitimate new reviews rather than trying to chase a pristine star rating. And, even just a handful of recent reviews clearly holds more weight than 5-star reviews from a year ago.

Go deeper by reading our analysis for businesses in a different industry.

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Impact of negative reviews

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Customers expect to see negative reviews of auto service businesses

Key findings include

17% of the reviews the average auto service business receives are negative

Auto service locations whose reviews are 35-50% negative earn 15% more than average

Auto service shops whose reviews are 0-5% negative earn 15% less than average

Auto service shops whose reviews are 50-75% negative still earn far more than average

It's clearly important to get a steady stream of fresh reviews, but how important is the mix of positive vs. negative reviews?

On average, 17% of reviews posted about auto service businesses are negative, which is slightly less than the 19% average across all industries. However, as we saw when we evaluated revenue by average star rating, auto service businesses seem to be less affected by bad ratings than other businesses.

Let's take a look at how much the total number of negative reviews impacts revenue at auto service businesses.

Indeed, these findings also show that auto service businesses are far less affected by bad reviews than other industries. As is the case with those other industries, the auto service businesses who earn the most money on average are those with a mix of positive and negative reviews. However, it's surprisingly the businesses with a negative review rate of 50-75% who earn the most.

Now, this is most likely due to a variety of factors, like the types of auto service businesses who consistently fall into this range as well as other factors. So one shouldn't assume that a 50 to 75% negative review rate is the ideal place for auto service businesses to be.

When customers browse auto service business listings on review sites, they expect to see a certain amount of bad reviews. And a listing with little to no negative reviews might look untested or even suspiciously guilty of buying fake reviews.

There's no question that auto service businesses should focus on getting as many real reviews as possible, and not losing sleep about how many of those reviews end up being negative.

Go deeper by reading our analysis for businesses in a different industry.

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Kindest and harshest states for reviews

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Where in the U.S. are consumers kindest (and harshest) to auto service businesses in reviews?

Next we analyzed online reviews at a state-by-state level to see which parts of the country are kindest (and harshest) in their reviews of local auto service businesses.

rank state positive review rate
FL TX NM AZ AK CA NV UT CO OR WA ID HI OK MT WY ND SD NE KS MN IA MO AR LA MS AL GA SC IL WI MI IN OH TN KY NC WV VA PA NY ME VT NH RI CT NJ DE MD MA DC

Vermont tops the list of best-reviewed auto service businesses with a positive review rate of 87%, while Utah comes in second with 86%.

Americans in every state are generally favorable in their reviews of local auto service businesses, as 43 states all average positive review rates of 80% and above.

Only Alaska, at 69%, averaged a positive review rate of less than 70%. This suggests that people are more likely to post generally positive reviews about auto service locations than one might expect.

Go deeper by reading our analysis for businesses in a different industry.

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States best at managing online presence

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Where in the U.S. are auto service businesses the best at managing their online presence?

Finally, we looked at which states' auto service businesses were the best at managing their online presence. First we looked at the percentage of auto service businesses in each state that had claimed at least one review site listing.

rank state claimed at least one listing
FL TX NM AZ AK CA NV UT CO OR WA ID HI OK MT WY ND SD NE KS MN IA MO AR LA MS AL GA SC IL WI MI IN OH TN KY NC WV VA PA NY ME VT NH RI CT NJ DE MD MA DC

87% of Minnesota auto service businesses have claimed at least 1 business listing, which is good for the top spot nationwide. Arizona and Delaware tied for second with 82%, and Rhode Island third with 81%.

On the other end of the spectrum, 45% of auto service shops in West Virginia haven't claimed even a single listing, putting the Mountain State at the bottom of the list.

Lastly, we looked at how frequently businesses in each state responded to their reviews.

rank state responded to at least one review
FL TX NM AZ AK CA NV UT CO OR WA ID HI OK MT WY ND SD NE KS MN IA MO AR LA MS AL GA SC IL WI MI IN OH TN KY NC WV VA PA NY ME VT NH RI CT NJ DE MD MA DC

Auto service businesses in Arizona and Oregon were the most engaged, with 35% of listings having responded to at least one review. Fellow western states Utah and Colorado came close behind with 34% and 33%, respectively.

West Virginia and Vermont auto service businesses were the least engaged, with only 9% of businesses having replied to at least one review.

Go deeper by reading our analysis for businesses in a different industry.

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Conclusion

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Conclusion

Online reviews are the new word of mouth for the digital age. Local auto service businesses that recognize and respond to how consumers use the internet to find, evaluate, and choose where to spend perform better financially than those that don't.

Specifically, local auto service businesses experience the best revenue performance when they:

  • Claim all their free business listings on relevant review sites
  • Are highly responsive to customer feedback posted on review sites
  • Have above-average review counts across multiple review sites
  • Receive a steady flow of authentic reviews from real customers
  • Have a credible review profile, comprised of a mix of positive and negative reviews

Go deeper by reading our analysis for businesses in a different industry.

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