Customers may be more inclined to share good experiences about smaller companies, making a business’s size one factor to consider when comparing online ratings, research in the Journal of Marketing found.
Across four field studies, researchers found a negative relationship between company size and the positivity of online word of mouth, even after accounting for measures of customer experience. Subsequent experiments examined a possible explanation: consumers felt more empathy toward smaller businesses.
The study by Jan Klostermann, Anne Mareike Flaswinkel, Chris Hydock and Reinhold Decker was published in 2025. The authors discussed its business implications in a 2026 American Marketing Association article.
Who chooses to write a review?
A star rating reflects the people who decide to post, not every customer who bought the product. If satisfied customers are more motivated to support a small company by writing a review, its average rating could be higher even when the underlying experiences are similar.
The authors studied online word of mouth across platforms including Yelp, Amazon, Twitter and Instagram. In experiments, empathy toward smaller companies was associated with a greater willingness to share a positive experience and a lower willingness to share a negative one.
That mechanism concerns the decision to communicate. It does not establish that all small companies outperform larger competitors, or that a low rating for a particular business is caused by its size. Product quality, service, price and the composition of customers also matter.
What businesses can learn from ratings
A company benchmarking its reviews against a much smaller rival may need to consider differences in the businesses and their reviewers before treating the gap as a direct measure of service quality. Comparing similar locations, products and periods can make the comparison more informative.
The researchers also examined how businesses respond to online feedback. Their paper reports that more frequent responses and language that invites empathy, including personalized replies, can mitigate the size-related pattern. A reply cannot fix the underlying problem if customers are describing a genuine defect.
Small companies should not assume favorable treatment is guaranteed. The authors report that negative conduct can weaken the goodwill associated with being small.
Our earlier coverage of a hotel experiment examined another part of the review process: asking for feedback can change who posts and can affect later customer spending. Together, the studies show why businesses should look beyond the average score when interpreting customer feedback.
