According to the findings of the study conducted by Indo-UK online reputation management company aReputation.co.uk, more than 6,000 SMEs and 240 large corporations in India have engaged such 'Online Reputation Management' service providers.
As many as 300 online management firms are currently present in India with most of them catering to small firms. The market size of online reputation management firms in the country is estimated to be close to Rs 200 crore.
The firms are spending Rs 25 lakh to Rs 1.5 crore to invest in their online image building, aReputation.co.uk said.
With increasing Internet penetration and growing influence of social media, the number of instances of negative comments and malicious rumours being spread on the web has also grown rapidly over the last few years.
As per the data from aReputation.co.uk, 49 per cent consumers are likely to research a business through popular social media networks such as Facebook, Google Plus and LinkedIn.
As a result, majority of the companies despite having good intentions are suffering from online criticism, it said.
"Companies and executives can spend years building a reputable and strong brand but it can be beyond disconcerting to wake up one day and see slanderous remarks reflecting online, particularly when the items move beyond constructive criticism to include outrageous accusations and defamatory remarks," aReputation.co.uk spokesperson David Miller said.
Employing cutting-edge tools, online management firms help companies tackle negative publicity on the web.
"We have clients here in India who have faced all kinds of crisis without any response plan in place. By the time they come to us, quite a bit of damage is already done," Miller said.
Miller added that online criticism can lead to companies lose customers and increased employee attrition levels.
Commonly, companies face online criticism in the form of malicious rumours, negative comments, disreputable remarks and scandalous conversations.
However, companies are taking major steps to improve their reputation online, Miller said.
These steps include reaching their customers directly through complaint forms on websites, email surveys or follow-up surveys, leaving reviews online, making sure they have a response strategy ready for negative ones and trying to resolve a situation before it turns into a crisis.