As a small business owner, it’s important to recognize that your business’s online reputation is part of its identity and that it can, for better or worse, significantly impact your bottom line.

How much impact are we talking? According to a 2012 national study, over 40 percent of U.S. adults have done their homework online before doing business with someone, and of those, 45 percent learned something that changed their minds. That said, there are steps you can take to develop the kind of online reputation that drives even more customers your way. Here’s how to do it:

Step 1: Listen to What’s Being Said

First find the online conversations being had about your business, then listen in. Google is a good place to start. Take note of the good as well as the bad, and consider how both types of feedback might be used to improve your business. It’s a simple enough exercise, yet it can provide invaluable insight. And because the digital landscape is constantly changing, you’ll want to listen often.

Step 2: Choose Your Channels Wisely

There’s a smorgasbord of social media channels out there, each having its own strengths and weaknesses. Instagram, for example, is designed for image sharing, while Twitter is built for text-based messaging. Set yourself up for a strong, successful social media campaign by creating accounts on only the channels that make the most sense for your business. Think about which ones have the most potential when it comes to reaching your target audience.

Step 3: Join the Conversation

Managing your business’s online reputation involves active participation. Engage your followers and work to give them good things to say about your business. Share the great things you’re doing, thank commenters, address any complaints (professionally, of course), and whatever you do, don’t argue with hecklers. Social media platforms perform well in search engine results, so if you’re facilitating positive conversations, your potential customers are likely to notice.

Step 4: Develop a Crisis Plan

Now more than ever, bad news travels fast. A crisis can escalate rapidly online, causing damage to your business in the process. For this reason, it’s important to be prepared with an action plan. Identify the person you could call on in the event of a crisis to monitor your channels, communicate with your team and respond quickly to your followers. You might even consider the help of a professional.

While social media is creating more responsibilities for businesses, it’s also creating tremendous opportunities for the ones that are doing it right. Use social media to develop your business’s online reputation, and watch your business grow!