What Happens When Restaurants

Negative Yelp reviews have more influence on consumers than restaurant owners believe. A machine-learning study conducted done by Chiara Farronato shows how online platforms can amplify the voice of customers and explains why business owners need to take note of.

There’s a saying that applies to hospitality that the customer always has the right. Indeed, the customer may become more powerful than they have ever been before, according to research on reviews on restaurants online.

Yelp the site on which users share their experience with service is often a catalyst for pest problems and other health issues in restaurants, which causes customers to steer clear of restaurants with poor reviews. Restaurants, on the other hand, usually respond by cleaning their actions, according to an study of Yelp reviews, OpenTable reservations, and information obtained from New York City Department of Health and Mental Hygiene.

“THE INFORMATION CONTAINED IN ONLINE REVIEWS HELPS CONSUMERS CHOOSE CLEANER RESTAURANTS, WHICH IS A PRETTY ROBUST FINDING.”

Harvard Business School Assistant Professor Chiara Farronato as well as Georgios Zervas, a senior instructor of Boston University, used machine learning to discern”hygiene” signals in the reviews of New York City restaurants. Their research has three main conclusions (no joke intended):

• First review sites provide more information regarding concerns that consumers are directly confronted with–such as the presence of food handling and pests methods–than the behind-the-scenes aspects that include the hygiene of workers.
• Additionally, these reviews can affect the appetite of customers, as establishments are less likely to open up in the weeks after a review which reveals unhygienic conditions.

• Finally, they discovered evidence that restaurants could consider these reviews’ influence in assessing the level of hygiene conformance.

Review sites that place some control into the hands of consumers are becoming more popular and not only for dining out. Websites such as Tripadvisor to help with travel, and Glassdoor for jobs provide millions of reviews that make businesses accountable and increase revenues and reservations for the most popular places. The COVID-19 pandemic is easing but there are still shortages of labor, these websites provide a second option for customers to navigate the bumpy road to normality, especially in the field of service.

consumer Reviews and Regulation Research that comes from NYC Restaurants, a new working paper from the National Bureau of Economic Research It demonstrates that restaurant review websites aren’t just an informative guide for customers they can also influence the business of restaurants as well as its regulatory authorities. As Farronato claims that the task of ensuring hygiene isn’t just within the control of the regulators. Consumers have a significant role in the detection of vermin and other sanitation problems.

“The information in online reviews can help consumers select cleaner eateries this is a reliable conclusion. Restaurants should take this impact into consideration when deciding if they should clean up after themselves, and we have evidence to support this,” Farronato says.

Machine learning to help you dine out

Health inspections for regulatory purposes are not new. Many cities operate the grading program to assess the hygiene of restaurants and the information is readily accessible to knowledgeable patrons.

Yelp is a well-known user-friendly method of aggregating the information. Therefore the professors created an algorithm to determine the ways in which Yelp review content is related to regulatory inspections. They discovered the food-related violations can be triggered by the words “sick” and “nauseous,” and pests’ presence are predicted by terms such as “cockroaches” and “filthy.”

“The semantic connection gives us some reassurance that consumers reading those reviews could actually infer hygiene information,” they write.

So, it’s no surprise that people weren’t looking forward to visiting these establishments. The machine-learning model was able to identify the ones with the highest number of negative reviews so that they could compare the likelihood that a restaurant would sell out over the period of two weeks preceding and after the review was submitted. The researchers found that restaurants were somewhere between 0.4 to 0.7 percent more likely sell out through OpenTable after a bad review, which is an 1.8 or 3.2 percent decrease in sold-out likelihood.

“I HOPE REGULATORS WILL START SEEING ALL THESE PIECES OF DIGITAL DATA AS USEFUL IN HELPING THEM DO A BETTER JOB.”

They also looked at hygiene compliance between restaurants that are reviewed on the website. The study found that more prominent restaurants are more likely to be in violation lesser hygiene standards discussed in reviews, which suggests that restaurants might actually review their establishments while cleaning.

Farronato believes that digital tools can make inspections easier which can be costly for cities with cash shortages.

“I hope regulators will start seeing all these pieces of digital data as useful in helping them do a better job in two ways: One is doing what they do more efficiently, and two is maybe doing less, because they can outsource certain things to the crowd,” she says.

Crowdsourcing can be imperfect.

Crowdsourcing isn’t without its limitations, however. It’s crucial for review websites like Yelp to publish reviews in chronological order that reflect current conditions because hygiene levels can differ greatly depending on the new personnel and management according to the research team.

“Review sites should be careful in making sure that the freshness of reviews is coherent with current status,” Farronato cautions. In a business with very tight margins, a few old reviews, but prominently displayed, could cost a restaurant good. “One or two reviews can destroy their life,” she says.

Additionally, reviews aren’t representative of the entire experience. Someone who has a grudge or an unpleasant day may write a harsh review.

“REVIEW SITES SHOULD BE CAREFUL IN MAKING SURE THAT THE FRESHNESS OF REVIEWS IS COHERENT WITH CURRENT STATUS.”

It’s a double edged sword Restaurants could manipulate customers to leave positive reviews through discounts, or even writing reviews by themselves. Platforms for users must be cautious about displaying reviews from trustworthy users.

Farronato and Zervas The research they conducted examines the likelihood that a restaurant has been recently reviewed and whether reviewers’ histories throughout Yelp to prevent the possibility of bias.

“The analysis of platform incentives to provide current and unbiased signals of quality is a valuable avenue for future research,” they say.

The power of monitoring

Farronato suggests this method of monitoring could be applied to other industries that have similar review sites, for instance, the review of employment conditions by Glassdoor.

“Glassdoor is a great platform for employees and workers to discuss the value of their job at a particular company. I believe that the regulators that focus on the labor market could use that wealth of data to better understand what is working, and perhaps we could design better regulations and swiftly identify what’s not working at a particular company, then go in and correct it. It’s extremely efficient,” she says.

In the near-term Farronato believes that both online reviews and regulators platforms will cooperate to create healthier, cleaner eating experiences for all. Online reviews offer the benefit over traditional regulations of being less expensive to collect and regularly updated.

“The outcome that I would like to see is having more of an integrated approach,” she adds. “They’re definitely complementary resources to inform and protect consumers from poor-quality service.”