Brands need to restore faith in customer reviews - report

Revelations that some unscrupulous businesses are publishing fake online reviews has led to calls for honest retailers to move to closed review platforms in order to restore trust among shoppers.

A report published on Friday by the UK’s Competition and Markets Authority disclosed that a number of organisations were engaging in fraudulent activity to trick potential customers. Such activity included:

• Writing or commissioning fake positive reviews about themselves to boost their ratings on review sites relative to rivals
• Writing or commissioning fake negative reviews to undermine rivals or for personal gain
• Cherry-picking positive reviews or supressing negative ones without making it clear to consumers that only a selection was being presented
• Not publishing some genuinely negative views but being dealing with them offline out of public view instead.

Because such practices are in breach of the Consumer Protection from Unfair Trading Regulations 2008 as well as UK Advertising Codes, the consumer watchdog has launched a formal inquiry into businesses it suspects are in breach.

The issue of online reviews and endorsements is perceived to be an important one due to estimates that more than half of all adults in the UK – the equivalent of 25 million – read them in general terms, rising to four out of five before they make a purchase, according to online reputation management company, Igniyte, which contributed research to the CMA report.

This means that online reviews potentially influence up to £23 billion-worth of consumer spending each year, although the scale of fraudulent activity is currently unknown. Some websites told the regulator that a mere 2% of their reviews were spurious, while others claimed the figure was “much higher”.

Nonetheless, one in five businesses now claims to be spending up to £30,000 per year trying to put things right in the wake of negative reviews.

Fixing business issues

Igniyte’s managing partner Caroline Skipsey said: “Paying for fake reviews and placing unsubstantiated content doesn’t fix real business issues – if your business is subject to genuine negative reviews, the only way to overcome it is by listening to your customers and addressing their concerns.”

But Philip Smith, country manager of ecommerce certification provider, Trusted Shops UK, called for more concerted action. While open platform review sites such as TripAdvisor and FreeIndex enabled consumers to share opinions, their open nature meant that “some dishonest retailers have found cracks through which to purchase or falsify reviews”, leading to confusion among consumers about who to trust, he said.

As a result, Smith added: “For businesses, the focus must be on creating trusted communities around the brand through honest and transparent interactions with customers and by encouraging feedback through social media and ‘closed platform’ review sites.”

Closed platform sites require buyers to enter an order number that must be validated if they want to view or post reviews, making it much more difficult to post fake or dupe reviews.

The CMA also cited some businesses that had already developed online systems to detect and verify fake reviews; to identify and emphasise reviews that were likely to be helpful to consumers; and enable users to flag up suspicious-looking reviews themselves.

But despite such technological developments Jo Causon, chief executive at the Institute of Customer Service, pointed out that quality relationships were as important as ever, with customers were relying more on peer-to-peer validation to help them make their minds up before making a purchase.

“This means success in business will be increasingly determined by the quality of relationships between an organisation and its customers. This has to be built through authenticity, transparency and trust,” she concluded.