We’ve long relied on formal expert reviews and ratings to help us decide what to buy. I have had a subscription to Consumer Reports (originally the magazine, now the online version) and I wouldn’t think of buying anything electronic without checking CNET.com.

Over the years, beyond the experts, more and more sites are allowing individuals to rate and review items. I personally find this invaluable and will read consumer reviews if I am making a major purchase. I recently bought a camping tent and spent an hour or more reading reviews on multiple sites before I decided what to buy.

Now there are multiple sites that allow individuals to rate and review businesses as well. These include sites like CitySearch.com,  Kudzu.com, Angieslist.com (NOT a complete list!) as well as lots of local sites. It is important for small businesses to understand ratings and reviews and leverage them to their benefit.

First, it is important to note that you really don’t have a choice about participating on these sites. Some of them populate their listings based on public data. Others allow individual consumers to add businesses, if they aren’t already there. As a business owner you may already be listed and not even know it! Business owners are able, and in fact are encouraged, to assume ownership of their listing but even if you don’t, you are there. Once you are there consumers will write reviews – and more and more are doing this every day – so it is in your best interest to join ‘em, not fight ‘em!

What does this mean? To start with, identify the major sites in your neck of the woods. The ones listed above are in most metropolitan areas and many local newspapers and TV stations are in the game as well. Then, add your listing if it isn’t there and take ownership of it if it already exists. Make sure it is correct, up-to-date and appealing. Consider it a bit of advertising you didn’t have to pay for as well as an opportunity for additional dialog with new prospects!

Next, make it a habit to check your reviews on a regular basis. You should respond to each review. To positive reviews you should add a comment thanking the reviewer. So-so or bad reviews are harder. It is important to respond but you have to stay calm, cool and professional. Remember, the people that read these reviews expect to see a variety of reviews – what is important is that you demonstrate how you solve problems and the type of customer service a would-be customer might expect.

If you do get a bad review and respond to it once, usually it is best to just leave it at that. There are some people, commonly referred to as trolls, that like to get attention by being mean and ugly in the reviews. Generally “don’t feed the trolls” by continuing to respond or getting involved in an escalating argument in a public forum.

Finally, it is worth your time to encourage your customers to leave reviews. You can do this in a number of ways:

• with a follow up note or email
• with a link or links on your website
• by offering an incentive, say 10% the next service, for customers that post a review.

As the popularity of ratings and reviews continues to grow, the number of sites that include them and types of businesses they cover grows as well. All businesses, from auto repair shops to doctors, dentists and lawyers, can be reviewed at one place or another. Put this forum to work for you – you can gain online credibility, get invaluable feedback about your business, attract customers and connect with people online in a whole new way. Nothing wrong with that!

Over the past few months I’ve needed to local a variety of service providers for my home – oven repair, a new fence, and rodent removal all come to mind. Like I mentioned before, I don’t have a phone book. If the service providers weren’t online, they were out of the running.

In all of these instances it took more work on my part to find providers than I would have liked. Each time I started with a Google search but was quickly frustrated because of the lack of ratings and reviews and because local and non-local companies were co-mingled. I then went to Kudzu.com (a local business directory). I had to do several searches before I found companies to call; if (in the case of the fence companies) their website was to fancy or included ornamental iron work for instance, I skipped them; they must be too expensive or too big to take a small job. I skipped firms with no website or really really ugly websites. I skipped companies with no ratings or reviews. I skipped companies, in the case of the oven repair, that didn’t specifically mention my brand range.

I finally found satisfactory service providers and in all cases I was very happy with the work I had done. But, it should have been a lot easier. What could they have done to make me find them faster?

• If a company doesn’t have a website, it should get one. You don’t HAVE to – many of the local directories allow you to create a free ad without a website. There are, however, folks like me that question your credibility and reliability if you don’t have a site. You can use Google to create a free site now which should be enough to get you started. Eventually, though, I think you’ll find it worth your while to at least invest in a simple, well-designed site to represent your business.

• Companies should take business directory sites like Kudzu more seriously. Most companies have few reviews; encouraging your customers to review you on sites like Yelp.com or Kudzu.com can easily distance you from your competition. And don’t limit yourself to one business directory service; in most metropolitan areas there are usually 3 or 4, including some local area ones. You don’t know which one your customers might use so make sure you are up to date on all of them and that you encourage reviews on all of them. In most cases these listings are free.

• If they find they are getting a decent amount of traffic from one or more of these services companies could consider paying for an “upgraded” account that will often push you up in the search results.

• List your business on the Google Local Business center

• Learn about SEO or hire someone to help them improve their site rankings on the search engines. Particularly in the instance of the appliance repair, having their site show up high in a search for “Atlanta appliance repair Thermador” would have caught my attention.

• Consider adding their company to LinkedIn or adding a Facebook fan page. While these social networking sites might not seem like obvious place for someone to look for services, content on both is regularly crawled by the search engines and would improve site rankings. Besides, you never know WHERE you customer is going to look for you!

Today fewer and fewer people are using traditional media (phone books or newspapers) to find companies. They are using the internet and they aren’t just using search engines. To be successful small companies have to take the time to make sure that they have a wide-spread online presence and that it is appealing and up-to-date because ONLINE is where the customers are!

P.S. In each case, after I received good service from the providers, I went back to Kudzu.com to give them a good review. I happen to know it is good for them but not every customer will think to do that. Another suggestion is to remind your customers at the end of the service that you would appreciate a review!

Fence photo:

I don’t have a single phone book in my house.  I don’t subscribe to any newspapers.   Local small businesses definitely try to get my attention in other ways. I am mostly annoyed by companies that put magnets on or tape fliers to my mailbox, not called to action.  The worst are those that put fliers in plastic sandwich bags with a few stones and toss them onto my driveway. Really? That is how you want to get my attention?

Long ago, in a small town it was easy for a proprietor of a small business to let his/her customers know what goods or services they provided. Everyone in the town passed by the shop window or come in to visit.  And because everyone talked to everyone else, even if Jane didn’t know Bob could sharpen her knives at his hardware store, when she bemoaned her dull kitchenware to Sarah, SHE was able to tell Jane that Bob had the answer to her problem.

In her blog post Back Noise is so 1880′s Diana Baldwin likens online social media outlets to the local store where everyone gathered and shared information and gossip. I think that is an interesting analogy.

So if there is no local store and no yellow pages and no one reads a news paper, how do you as a business owner get my attention, especially at the all important time when I NEED YOUR SERVICE?  Like when I had to have my fence repaired?  Or when my oven quit working?  Or when my basement is flooded?

I have come to the point in my life where I want to find goods and services online, preferably with local companies. In addition, I want as many of my interactions with these companies to be, you got it, online. This is a problem for small businesses and it is a problem that will only get worse.   After me is a generation that has been brought up completely in a digital world; together we will insist on doing everything online.   We will require more than a brochure-ware website and email address that isn’t monitored. We will require that you do business online.  Completely.

I can hear you now. You are saying “I am in the relationship business and the Internet is so impersonal”. Or “I am in business to serve those in my neighborhood, not folks around the world, so why do I need to take the Internet seriously?”. Or even “All the technology is so expensive, it can’t be cost effective.”.

Right now lots of people use the Internet as a replacement for the phone book. We use it as mechanism for asking others for recommendations for goods and services.  We use it to shout out our wants and needs to any service provider that is listening.  The businesses that know and take advantage of this will prosper in the future.

What does this mean to a small business?

• It means, of course, that you have a website and use (and check) email. It means that I have to easily find your website. If I don’t know the name of your company I am going to search for “Atlanta appliance repair” – will your website show up?

• It means that if there is a local business finder site I will be using it. There are several of these around the country – are you on yours? Does it link to your website and have accurate contact information, at a minimum?  Have you proactively enlisted the help of your raving fans to make sure that there are good reviews on it?
• It means that you need to know what your customer does online. Do they Twitter in frustration because their oven doesn’t work? Do they look at recommendations on local business finder sites or Yelp or any other site? Do they become fans of companies on Facebook?
• It means that businesses need to be prepared to deal with leads that come from online channels and to reciprocate by serving customers online. Based on the needs and wants of your customers, your company needs the processes and systems to transact as much as possible online. Someone needs to respond to their emails and be available to chat. You should consider providing online methods for setting up an appointment, providing quotes, paying invoices, and responding to customer service needs.

None of this is new. Your competitors will be doing this soon, if they aren’t already.  Are you ready?