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Business is often thought of using the metaphor of a game. You’ve got to play to win. In some leagues, the game is played “dirtier” than in others. But sometimes something happens that changes the rules of the game, with big consequences for ethical behavior. The clearest example of a game changer is the rise of crowd-sourced reputation aggregators, such as TripAdvisor and Yelp. They have made it more profitable for businesses to treat all of their customers well, and to be responsive to customer feedback. On this page we will collect examples of such game changers. We hope and expect that the good ones can be extended across many more industries. We’ll also collect all the research we can find on these game changers, so that any conclusions we draw are not just based on anecdotes and intuitions. 

Other examples we may cover on this page:

  • IEX, the stock trading exchange started by Brad Katsuyama, in response to the corrupt practices described by Michael Lewis in Flashboys
  • ​Seals and certifications, from “Good Housekeeping” through the Rainforest Alliance’s “frog.” 
  • [more to come]

Trip Advisor:

1. The Impact of Social Media on Lodging Performance, Cornell Hospitality Reports, 12(15), 6-11. 2012. 

The first research to demonstrate the return on investment that hotels can expect from social media and reviews. Data from ReviewPro, STR, Travelocity, comScore and TripAdvisor has been combined to show social media’s growing influence on the consumer research process and how this influence, in turn, can impact a hotel’s ability to set prices, drive occupancy and increase revenue.

Key findings of the study

  • Guests are visiting TripAdvisor more frequently prior to booking
  • Higher review scores on OTA sites allow hotels to charge more while maintaining occupancy rates
  • Properties with stronger reputations across all channels perform better overall

 

2. Online reputation management: Estimating the impact of management responses on consumer reviews, Boston University School of Management Research Paper No. 2521190, 2015. 

Management responses to online reviews are becoming an increasingly important reputation management strategy. This study investigates the relationship between a firm’s online reputation and its decision to respond to reviews.

Key findings of the study: 

  • Hotels are likely to start responding when they experience a negative shock to their ratings.
  • Once hotels start responding, they respond to positive, negative, and neutral reviews with approximately the same frequency.
  • Responding hotels see an average increase of 0.1 stars in their TripAdvisor ratings after they start responding.

 

3. Does TripAdvisor Makes Hotels Better?, University College Dublin, School of Computer Science & Informatics Research Paper, 2010.

Key findings of the research: 

  • Sufficient evidence supports the original hypothesis explored by Briggs et al. (2007): “Demanding and informed customers are creating an environment of improvement leading to excellence in all segments of the hotel sector.”
  • An increased awareness of TripAdvisor among hotel managers lead to a genuine improvement in product quality.