There was time when consumers purchased even the smallest and most insignificant addition to their homes after a lot of consideration and long drawn evaluations of quality and price. However, with the advent of the internet and ready availability on information online, including feedbacks and reviews for endless products and services, they are now increasingly relying on what others have to say about it, based on their experience. A series of reviews enables them to deduce what they are likely to expect if they buy the product or service, and then take a final call.

But what is the statistical significance of the reviews and recommendations that are normally subjective in nature. Have you, as a consumer, ever questioned what these ratings really indicate – “4 out of 5 stars”, or “a whopping 70% of consumers rate us as the best in the industry”? When you boil it down to hard figures, 70% can even be just seven out of the ten that were interviewed in the first place! Do you then not ask yourself: “How can a few reviews be representative of the opinion of the larger mass of people?” Is this percentage, that we have been handed on a platter, a real indication of the general public feeling, or is it just a quick response-check of a select few? How statistically significant is this data?

In my opinion, these questions arise because we have not really understood what the phrase “statistical significance” means and how it can be measured. Statistical significance is, after all, a figurative assumption created out of a basic hypothesis. But the basic hypothesis is literally, on the flipping of a coin, a probability; a matter of ‘chance’. But can we really take a decision based on this probability?

Despite all the bookish definitions that we may give the phrase, what is important from the customer’s perspective is whether the feedback that comes forth from these reviews is a clear indicator of the actual picture and enough for them to base their judgement on.

“As many as four out of ten guests adjudged our Boutique hotel to be the best experience they have ever had” – XYZ Boutique hotel. (Do stop to think for a second, that maybe, they have only had ten guests stay with them so far. Then the evaluation does seem to signify that the six, the majority, were dissatisfied). Now, does this change your perspective?

Statistics also ascertain that the year 2015 reported a historical low in terms of aircraft accidents and the fatalities ratio to million departures was pegged at 247. Though the number is seemingly low when calculated as a percentage, the fact remains that there are thousands of aircraft taking off from across the world every single day. And taking that into account, 247 out of a million departures, though lower than the ratio for previous years, may still not be a very comfortable figure for a flyer.

Similarly, if a majority of students considered their college to be the best institution to study in, but a handful said that the same college did not give them the right launch pad that was required, how would you, as a third person, interpret it? You may not even consider what the majority had to say. It is the experience or feedback of the handful that can make you change your mind completely, particularly if your focus is to get into an institute that holds a good placement record.

In that sense, although subjective in nature, qualitative feedback in the form of reviews and recommendations can help fill in the small, yet critical gaps and complete the picture for you to be able to take a better decision, because even though there are exceptions, they are real experiences afterall.

Manu Mital