Stars, Prices, and Profits: How YOUR ratings harness OUR potential

In today’s digital age, consumers rely heavily on ratings and reviews when making purchasing decisions. The impact of positive or negative feedback on a product can be huge, not only in terms of reputation but also in driving profits. Understanding the revenue and price elasticity of demand is crucial for businesses aiming to thrive in today’s competitive marketplace.

Exploring the Power of Ratings and Reviews

This article explains how good ratings and reviews can help price products effectively to boost profits. We will delve into these aspects through three compelling case studies, each highlighting the importance of the relationship between ratings and pricing strategies in the modern marketplace.

Case Study 1: The Ripple Effect of Positive Reviews

Positive reviews and high ratings serve as a solid social proof and a trust signal to potential customers, affecting both average revenue, marginal revenue, and elasticity of demand.

This very case was observed live for one of our clients wherein after improving their ratings, the company experienced a remarkable growth in day-over-day profits.

On an overall level, the company saw an increase of 21.2% in their revenues, with the revenues increasing by as high as 38% through Viaje’s AI-powered dynamic pricing strategies. The company saw a 14% increase in their ASPs as well, with the highest going up to 22%.

Revenue management in the travel industry is becoming increasingly complex, and understanding dynamic pricing is essential. Ratings and Pricing algorithms go hand-in-hand, since customers are willing to pay a premium for better journey experiences. The higher rating indicated improved product quality and customer service, and this enabled us to make valuable changes on pricing and profitability:

Higher Perceived Value:

  • Customers started perceiving their service as of higher quality due to the improved ratings. This perception enabled the company to increase its prices, leading to higher profit margins. AI-powered pricing software played a crucial role in optimizing these pricing strategies.

Price Elasticity Reduction:

  • With higher perceived quality, the demand for the operator & company became less sensitive to price changes. Customers were now willing to pay a premium for efficient and smooth services, which translated into increased profits

Brand Building:

  • Positive reviews not only attract new customers but also encourage repeat business and word-of-mouth referrals. Satisfied customers often become loyal customers, driving consistent revenue growth.

Case Study 2: The Comparison of Influence of Ratings on Two Bus Services

Another interesting case was observed in one of our clients who had, both, a bad-rated and a decent-rated bus. Bus A, with decent ratings, was able to perform considerably better than Bus B – which had bad ratings. There was a difference of around 23% in the overall day-over-day revenues of both schedules. 

We were also able to capitalize on the demand days for Bus A – allowed by their ratings – by increasing their revenues by 32%. 

While Bus B held us back since it only experienced a 4% increase. Dynamic pricing is a well-known example of how different industries utilize ratings to improve their pricing strategies effectively.

  • Consumer Trust:

    Bus A, with its high rating, enjoys a significant advantage in terms of consumer trust. Customers perceive it as a more reliable and safe option, which allows them to charge higher fares. 

  • Pricing Power:

    Bus A can command slightly higher prices than Bus B, even during non-peak times, because customers are willing to pay more for the perceived reliability and safety associated with a good rating.

  • Market Share:

    Bus A likely captures a larger share of the market due to its higher rating, while Bus B struggles to attract customers. This translates to higher revenues for Bus A. Understanding what dynamic pricing is and enabling us to unleash its true power by maintaining a service standard further boosted the revenue potential of the bus

Case Study 3: The Prestige of Good Ratings

Another case was observed for one of our clients who has a good reputation and rating in all their routes. This prestige enabled us to earn better revenues for them by a significant amount. 

Good ratings in private travel are a key factor in driving business success for them. Their reputation allowed us to price considerably higher. The final revenues of the operator were seen to be 49% higher than the rest of the market

  • Pricing Flexibility

    Our client, with its high ratings and prestige, has the trust of its customers. This trust allows us to implement dynamic pricing effectively, raising fares during peak times. Customers are more willing to accept these price increases because they trust the company’s service quality.

  • Maximising Revenue:

    With dynamic pricing, we maximize its revenue during surge days by capitalising on high demand. The 49% revenue increase demonstrates the effectiveness of this strategy when combined with a good rating.

The Quality of Reviews Matters

While this was just the ‘number’ factor of the ratings, the quality of the reviews matter too. Customers are increasingly becoming conscious about their purchases and are more comfortable with paying a price for a premium. Hence, they also go through the reviews and base their purchase decisions on the quality of the reviews. 

It’s simple, nobody purposely gives good reviews. BUT, the customer will make sure to leave negative reviews if they experience discomfort. The schedules where less number of negative reviews were displayed – were observed to be performing higher than the ones where more negative reviews were present.

The Role of AI-Powered Pricing

That’s where the pricing strategies come into play. The companies can actually study the quality of their reviews and make informed decisions and changes if they want to strategically grow their reputation and business. Ticketmaster dynamic pricing is a well-known example of dynamic pricing in the entertainment industry.

AI-powered pricing is revolutionising how businesses approach pricing. But channelling the actual potential of Dynamic Pricing by maintaining a good standard of services can drive up the profits of your buses significantly higher – acting as a cherry on top.

Listening to Customers

The customers are loud, the companies just need to actually listen to them. 

Good ratings and reviews provide businesses with the trust and perceived value needed to implement effective pricing strategies and drive up profits. Conversely, bad ratings can undermine pricing power, hinder revenue growth, and limit the effectiveness of dynamic pricing during peak demand periods. Understanding the relationship between ratings, pricing, and revenue as well as learning how to categorise and tackle them is crucial for businesses aiming to thrive in today’s competitive marketplace. Pricing strategy examples from other industries can also provide insights into effective approaches

To keep up with this dynamic environment, it is imperative to learn how AI pricing engines can help you do that.

Book a free demo of our automated retail solutions or contact our optimization experts at

To learn more about our AI-powered dynamic pricing tool , reach out to us.

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