Welcome to The Merchynt Business Review, where we analyze a small business's online reviews to find ways they can win customers from their competitors and grow their business faster. Give us 5 minute and we'll show you how to increase your small business' revenue by 5-9%.
This week's featured small business: Santa Monica Pizza Kitchen
About them: Santa Monica Pizza Kitchen (SMPK) is a pizza shop located about a mile from the touristy part of Santa Monica, California, USA. They offer traditional quick Italian restaurant cuisine including pizza, calzones, salads, and wings. www.santamonicapizzakitchen.com
Current online customer reviews: 4.4/5 on Google & 4/5 on Yelp
To start, let's have a look at their overall customer satisfaction score, which is a moving average of what their customers are saying about them in written reviews across various online review platforms, like Google, Yelp, Facebook, TripAdvisor, and others.
Right off the bat you're going to notice that their customer satisfaction is not looking great. Not only is their score below 80%, it's also down 27.2% over the last 12 months! It's been hard for restaurants to meet customer expectations during COVID, but we'll look into how their competitors managed during this time later in this report to see if their decline all COVID related.
Next, we'll run an analysis on all reviews from the past 12 months and assess customer satisfaction against industry specific key performance indicators (KPIs) to see what exactly is bothering customers. A quick view of the graph below tells us that:
1. In December 2019 their overall "general" customer satisfaction began to slip, and continued to until August 2020, when it began to recover. Did they change cashiers, managers, phone answering services? What happened in December last year? If they can fix this they can continue the upward trend in general customer satisfaction.
2. In June 2020 the perceived quality of the food dropped from a 100% satisfaction rating to around an 83%, and it stayed there. What happened? Did they start selling through delivery platforms which resulted in colder food by the time it reached the customer? Did they change cheeses? Since we weren't there we'd need to look into the reviews from this time period to see. This review from June indicates a change was likely made, which they should consider reversing:
3. In June 2020 the hospitality satisfaction score also dipped. This trend seems to be correlated with their general satisfaction scores, so let's have a look at reviews related to just customer service during this time period:
As you can see from 3 reviews related to customer experience, 2 of them were negative. One had to do with delivery services, and 2 had to do with bad handling of customer issues.
Now, let's have a look to see how their reviews stack up against their competitors: Joe's Pizza, Dagwoods, & Rock N Pies. As you can see below, it's a tight race between these 3 Santa Monica pizza shops all located within a few miles of each other.
Their ratings are all extremely similar, with the only outlier being Joe's Pizza's much lower Yelp rating. To get a clearer picture of the competition and how Santa Monica Pizza Kitchen can start winning more customers we'll need to analyze every written review for each of these businesses from the past 12 months to see what exactly customers are saying they like and dislike about them.
Across the board we can see that Santa Monicans really enjoy the pizza from Santa Monica Pizza Kitchen, but they also enjoy the pizza from their top competitors. When we're looking at this we're trying to find things that competitors are doing better and then beat them at their own game. People like Santa Monica Pizza Kitchen's Pizza & Food generally, but dislike their experience, cheese, and place. You'll notice that SMPK's customers dislike their place, while Rock N Pies' customers like theirs. Let's dig into that and see why. A simple online search will show us that Rock N Pies place looks like this:
It looks pretty cool, right? Seems like a fun place to grab a slice with some friends. Ok, now let's have a look at what we found for Santa Monica Pizza Kitchen:
Yikes.. definitely not as nice, and unfortunately for SMPK, it turns out that Santa Monicans appreciate a nice atmosphere when eating pizza. This is hurting their online reviews and ability to win more customers. When the competition for your main product is fierce it's important to focus on the other details that potential customers are looking for.
Lastly, lets have a look at Santa Monica Pizza Kitchen's general customer satisfaction over the past 12 months compared to their competitors:
Wow! We're seeing some serious dramatic changes in just the past 12 months. Santa Monica Pizza Kitchen started tied for #1 with Dagwoods, but since February 2020 they've been steadily declining, with their biggest drop happening in September. They should look into what changes they made to their business in February and September 2020 since that's when their customer satisfaction took the biggest drop. Meanwhile, let's see what their competitors have been up to in the same time period:
Joes Pizza started from the bottom and now they're in first place for general customer satisfaction.
Dagwoods stayed extremely steady at around an 85-90% satisfaction score.
Rock N Pies had some ups and downs, but generally stayed within the same range of about 75% satisfaction.
Takeaways for Santa Monica Pizza Kitchen:
If you provide better customer service for your customers you'll get better reviews online
If you clean up your shop and decorate it a bit you'll stop losing some customers to Rock N Pies, since we've learned that people in your area are looking for a fun, cool place to eat pizza.
Think about what happened in February & September that could have upset your customers, and fix it.
We found that you responded to 0 of your 57 written reviews over the past 12 months. You really should be responding to reviews since doing so is proven to help businesses move up in local search results.
Their review assessment: Their overall review score is respectable, however their poor customer service, messy shop, and lack of review responses is likely hurting their ability to win new customers from their local competitors.
Estimated outcome if the above recommendations are done
Based on a Harvard Business School survey, a single star increase in online customer reviews can result in a 5-9% increase in gross revenue, specifically for a small business operator. If their annual revenue is $1,500,000, and they can raise their 4 stars on yelp to 4.5, and their 4.4 stars on Google to 4.8, we estimate that they can increase their revenue by 3%, or $45,000 per year.
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