Why social media backlash can be devastating for small businesses

Social media makes it easy for customers to share their experiences online, which can be both a blessing and a curse. 

Happy customers can boost your reputation and attract new business, but a single negative post can also spiral into reputational damage overnight, even when complaints are exaggerated, misdirected, or even untrue. 

And while large brands can more easily bounce back with PR teams and legal support, small businesses may lack the resources to recover so quickly. So, how can small businesses best respond in the case of online criticism to minimise impact?

Why small businesses are uniquely vulnerable to online backlash

Small businesses often rely heavily on local reputation, customer retention, and word of mouth. This means a viral post on platforms such as TikTok, Instagram, or X can quickly dominate the online conversation and have serious real-life consequences. 

The Guardian recently reported that several US businesses had been victims of online criticism. One example was a California-based sandwich shop that was forced to close after its menu prices were mocked in a viral Reddit post.

While closing down is the worst-case scenario, negative online reviews can very easily result in reduced footfall and damaged profits.

That’s not to say that customers shouldn’t share honest criticism. In many cases, the problem lies with the fact that social media algorithms reward polarising content that provokes strong reactions. This leads to more creators making extreme comments for the sake of engagement, and for small businesses, this can spiral out of control. 

How to respond — engage, ignore or escalate?

Ignoring criticism can signal that customer experience isn’t your priority. But responding publicly can push engagement and attract more eyes to the initial complaint.

To make matters worse, SMEs don’t often have dedicated PR teams on hand to deal with complaints, which can lead to your reply being subject to further scrutiny if it misses the mark.

It’s important to remember that you’re under no obligation to respond publicly. Equally, don’t feel the pressure to match the customer’s tone. It can be tempting to defend your business with a fierce comeback, but it’ll often add fuel to the fire and come across as unprofessional.

Instead, it can be best to move conversations offline and limit responses, rather than engaging in a back-and-forth. 

Practical lessons for SMEs

You can’t stamp out online criticism entirely, but you can reduce its impact by taking some practical steps.

Building a strong base of loyal customers and actively encouraging them to share positive experiences can balance out criticism, making it less likely that a single negative post will tank your reputation.

It also helps to set clear protocols about how and when to respond publicly and when to step back, rather than reacting emotionally in the heat of the moment. 

Finally, don’t ignore the very real emotional impact of online criticism. Receiving negative comments online can feel overwhelming, but maintaining perspective, leaning on support networks, and taking time away from social media can help you stay grounded and recover more quickly.