NEW ORLEANS – Online “word of mouth” is the buzz consumers create when they share their experiences of products or services on social media and review sites like Yelp, but a recent paper published in “Sage Journals” finds that few studies have examined how company traits, like size, shape these conversations.
The researchers, who include Chris Hydock, assistant professor of marketing at Tulane University’s A. B. Freeman School of Business, discovered that smaller companies tend to spark more positive reviews because consumers feel empathetic toward them.
“This project explored the inherent biases present in online consumer reviews, and our findings reveal that big businesses tend to receive lower average ratings compared to small businesses,” said Chris Hydock, co-author of the study and assistant professor of marketing at Tulane University’s A. B. Freeman School of Business. “Interestingly, this isn’t because consumers are more critical of big businesses, but rather because they are less inclined to leave positive reviews for big businesses and more likely to do so for small businesses after a good experience.”
According to Roger Dunaway, Assistant Director of Media Relations in the Office of University Communications and Marketing at Tulane University, the research analyzed millions of consumer reviews from Yelp, Amazon, Twitter and Instagram. Even when controlling for experience quality, smaller companies consistently received higher ratings than their larger counterparts.
“Through experiments and real-world data, the researchers discovered that customers were more likely to write glowing reviews about small companies after a good experience and less likely to post a negative review after a bad one,” said Dunaway.
“This creates an overall positivity bias for small businesses,” Hydock said. “People empathize with them more, and that empathy influences not only whether they leave a review, but what kind of review they leave.”
“According to the study, empathy drives what the researchers call a ‘selection effect’ when consumers feel a personal connection with smaller businesses and are more motivated to help them,” said Dunaway. “That means they’re more likely to spread the word about a positive experience—and more forgiving when something goes wrong.”
Conversely, people are tougher on larger companies, often viewing them as impersonal and self-sufficient. The study not only exposed this empathy gap but also tested strategies for closing it.
“For everyday consumers, lower ratings for big chain businesses might not reflect their true quality, while reviews for small, well-known establishments could be somewhat inflated,” Hydock said.
Hydock said that companies that responded to reviews more personally and emotionally—by using customers’ names, expressing genuine concern and writing thoughtful replies—could boost their review scores. “These kinds of empathetic interactions helped humanize the brand and made customers feel more connected,” he said.
“We highlighted strategies that big companies can use to boost positive online reviews, such as employing empathetic language and addressing consumers by their real names in responses. These aren’t expensive fixes. Simply being more responsive and writing back in a warmer tone can shift how people feel about a company—and how they rate it,” Hydock said.
Online reviews heavily shape consumer spending, guiding what people buy and where they go. For businesses—especially big brands—grasping the forces behind review trends is key to protecting their reputation and earning customer trust.
The “The Effect of Company Size on Aggregate Word-of-Mouth Valence” study was a collaboration between Hydock, Jan Klostermann (University of Cologne, Germany), Anne Mareike Flaswinkel (Bielefeld University, Germany) and Reinhold Decker (Bielefeld University, Germany).