I have been working in the online reputation industry for 8 years, and this is one of the most interesting questions I encounter. The reason lies in performance measurement and the desire for improvement. Before answering the question, I would like to explain the reasoning behind it.
Why Would We Want to Know the Average Rating?
As we all know, what you don’t measure, you can’t improve. However, measurement alone is not always enough. Let’s imagine that we are managing a restaurant and notice that our restaurant has an average online rating of 4.5 stars. Is that good or bad? It is very difficult to answer without having more data.
For example, if we have a 4.5-star rating based on only 2 reviews (one 5-star review and one 4-star review), that is not particularly good because we lack credibility. It looks like a new establishment where very few people have dined so far. However, if we have the same 4.5-star rating based on 390 reviews, we might initially think that is good. Yet, if the surrounding restaurants have a similar number of reviews and average ratings between 4.7 and 4.9 stars, then our performance is not that impressive.
This is why any metric must be viewed in context in order to be interpreted correctly.
For this reason, I scanned the internet and built a benchmark using online reviews of businesses across the United States.
What Is the Average Rating of a Restaurant?
I analyzed more than 5 million restaurant reviews from across the United States and created the following benchmark for business reviews. Based on this analysis, we can say that the average restaurant rating in the U.S. is 4.25 stars.
What Is the Average Rating of a Hotel?
As for hotels in the United States, I monitored more than 1 million reviews and calculated an average rating of 4.28 stars.
Conclusion
Based on the data above, it becomes easier to evaluate a restaurant or hotel by comparing it to these averages. For an even more meaningful comparison, we need to look at the competition—that is, nearby competing businesses. Only then can we truly determine whether our performance is good or poor.
Here you can find a benchmark of reviews for each state.
Methodology
I collected data from more than 100 restaurants in every U.S. state. In most cases, the restaurants were located in a major city representative of the respective state. This resulted in a dataset of approximately 5 million restaurant reviews and more than 1 million hotel reviews.
After collecting the data, I grouped location ratings by state and restaurant type, which enabled me to generate the benchmark data presented above.