How Not To Deal With Negative Reviews

How Not to Deal with Negative Reviews

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It could be argued that a negative online review can cost you money. But one hotel’s experience show’s how not to deal with negative reviews, even if you believe they’ve hurt your business.

The Union Street Guest House, located near the Catskills in Hudson, NY, charges customers $500 per bad review. The policy has caused outrage among review site users, with guests lashing out at the hotel’s customer review policies.

The hotel’s website recently removed all mention of the fines, but not before multiple online sources, like Fast Company and Slate, posted the policy which read as follows:

“If you have booked the Inn for a wedding or other type of event anywhere in the region and given us a deposit of any kind for guests to stay at USGH there will be a $500 fine that will be deducted from your deposit for every negative review of USGH placed on any internet site by anyone in your party and/or attending your wedding or event. If you stay here to attend a wedding anywhere in the area and leave us a negative review on any internet site you agree to a $500 fine for each negative review.”

Online reviews have a lot of power these days. One study conducted(PDF) by the Harvard Business School found that each star on a business’s Yelp page can increase revenue by up to 9 percent. So it makes sense that bad reviews would have the reverse effect. But is punishing customers for giving you bad reviews really the answer?

There are businesses that are using another tactic, rewarding customers for online involvement that tends to show the brand in a positive light.

For example, Marriott recently introduced a policy called Plus Points to reward customers for following the company’s Facebook, Twitter or Instagram accounts. Customers are also rewarded for using hashtags like #LoveMarriottRewards in daily social media posts.

By contrast, the Union Street Guest House’s policy seems to have brought the business more of the negative feedback it was apparently trying to avoid. The ploy has caused a wave of angry one-star reviews on the company’s Yelp page, many from people who have read about the policy online.

In an apparent attempt to defuse the situation, the hotel released a statement on its Facebook page trying to pass the policy off as a joke, reports Fast Company. In the post, the hotel management explains:

“The policy regarding wedding fines was put on our site as a tongue-in-cheek response to a wedding many years ago. It was meant to be taken down long ago and certainly was never enforced.”

The Facebook page seems to have since been taken down.

However, in another Yelp post below, at least one bride indicates that, in her case, the guest house actually did try to make good on its threat:

A review left on Yelp

The Union Street Guest House currently holds a 1.5 star ranking on Yelp. The hotel’s experience might be a good reminder to any and all businesses about the power — both positive and negative — of online reviews.

Images: Shutterstock, Yelp


Aubrielle Billig Aubrielle Billig is a Staff Writer for Small Business Trends. She covers business as it is impacted by pop culture, entrepreneurs in the arts, and other topics affecting creative businesses. She has a background as an illustrator and her design page can be found at AubrielleBillustrations.

5 Reactions
  1. I am all for rewarding customers for positive reviews than punishing them for negative ones. People are still entitled to their own opinion and people have no right to punish them for simply airing what they think.

  2. Oh wow, they really did dig their own hole there. I’m not even sure what they attempted to enforce is legally binding. Also, if it was tongue-in-cheek, then why didn’t it come across to anyone as such?

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