Study: Fake Reviews Take Heavy Toll on E-Commerce | E-Commerce
By Jack M. Germain
Mar 5, 2020 4:00 AM PT
Product vendors are facing a growing negative reaction from consumers concerned about product quality and fake or misleading product reviews posted online, according to a study
Bazaarvoice released Thursday.
A large majority of consumers polled said they would flee a brand if the manufacturer sold them poor quality products, ran dishonest or misleading ads, or was associated with fake or fraudulent reviews.
A tide of negative consumer reactions has been washing out product sales, suggests a similar report from
Sift. Consumers are not buying products that lack believable reviews on company websites.
Based on survey responses from more than 10,000 consumers in the U.S., UK, France, Germany and Australia, the just-released Bazaarvoice study examines the role of brand trust in consumer purchasing behavior, and some of the ways brands can damage that trust.
The results provide new insights into how brand trust is built and broken. The study includes the role of product ratings and reviews and how shoppers evaluate their authenticity.
Key U.S. findings from Bazaarvoice’s new study indicate that brand trust is paramount for customer loyalty. Eighty-five percent of consumers surveyed said they would avoid using a brand that lost their trust.
The study also revealed the critical role fake and fraudulent reviews play with respect to consumer trust.
“Fake reviews can be devastating to a brand. Simply put, once shoppers suspect a company of having fake reviews, trust is in question. In an era of misinformation and fake news, brand integrity is essential to building consumer trust, which directly translates to profit,” said Joe Rohrlich, chief revenue officer at Bazaarvoice.
The most common way a brand could lose their trust was by selling products that were poor quality or damaged easily, according to 66 percent of the respondents. The second most damaging cause for loss of trust was receiving dishonest brand or product information, an issue for 55 percent of respondents. A third tipping point for losing consumer trust was a brand having fake and fraudulent reviews, noted by 43 percent of respondents.
“What became increasingly clear through this research is that shoppers have high expectations for brands when it comes to handling fake reviews,” Rohrlich told the E-Commerce Times.
Fifty-seven percent of respondents said they would still buy from a once-trusted brand after one negative product experience. Once established, trust encourages consumers to be forgiving as well as loyal. It is an invaluable asset for brands to have, the report notes.
A major takeaway from the brand loyalty report is that authenticity of reviews affects a brand’s bottom line. Thirty-one percent of respondents said they would not buy a product if they suspected its reviews were fake. Twenty-eight percent of respondents said a fake review would cause them to distrust other reviews, and 26 percent said it would lead them to distrust the brand.
Customer reviews have become one of the most important marketing channels for almost every online business, whether they sell directly or through retailers, observed Jeff Sakasegawa, trust and safety architect at Sift.
“When customers lose faith in the authenticity of reviews, it can lead to the loss of trust in the business as a whole and affect their customer engagement,” he told the E-Commerce Times. “Our study ultimately shows that online businesses need to ensure that their customers are able to shop in a safe environment that they can trust — or risk losing revenue.”
Looking for Brand Integrity
One of the most significant takeaways of the report is that consumers are questioning whether brands are proactive enough to protect them from fraudulent content.
Study participants gave specific indicators for what they wanted to see from review content, including more transparency around the review vetting process and more information about who was writing reviews, Rohrlich noted.
“It’s clear that consumers are concerned about fake reviews and want to be able to trust that brands are doing their best to provide them with authentic content,” he said.
Consumers are on the lookout for signs of fake product reviews. Shoppers are most suspicious that a product may have fake reviews when they read multiple reviews with similar wording, noted 59 percent of respondents.
Half of those polled said they looked for review content not matching the product. Another key indicator of fake reviews was seeing an overwhelming number of five-star ratings/positive reviews, according to 35 percent of the study’s participants.
To avoid alienating consumers with trust issues, it is paramount for brands to implement both textual moderation and data driven anti-fraud processes, according to the report. Doing so ensures review authenticity and relevance, and helps product makers keep the trust and the patronage of the consumer.
Brands Losing Consumer Trust
Considering brands more broadly, consumer trust is at an all-time low, according to Rohrlich.
The research provides clear guidance to brands around what consumers are looking for when it comes to review content, he said, and it can help businesses earn and retain consumer trust.
Consumer distrust for brand integrity is a growing trend. The survey shows similar consumer attitudes across multiple borders.
“This survey was conducted with respondents from five different countries, which provides unique insight into how consumer preference differs by location. For example, German respondents tended to be the most critical of fake reviews and called for stricter punishment, observed Rohrlich.
Fake reviews are an issue that has infiltrated e-commerce, regardless of what industry is involved, he said. Changing the consumer perspective is up to all players involved, from third-party providers to the brands themselves. They should work together to embrace authenticity and transparency, and continuously work to weed out deception.
“Because shoppers are hardwired to seek out the thoughts and opinions of their peers, we need to ensure that our consumers can confidently turn to ratings and reviews as trusted sources,” urged Rohrlich.
New Standards Needed
The report shows a growing demand from consumers for new standards to combat fake reviews and impose harsher punishments for noncompliance. The majority of respondents (72 percent) believed new standards were necessary to combat fake reviews in the retail industry.
A requirement that only customers who made verified purchases should be able to post reviews was favored by 42 percent of respondents. All products should be tried and tested among legitimate consumers before launch, said 34 percent. Daily monitoring of customer content was needed to weed out fake reviews, according to 27 percent.
On average, the survey takers believed that an appropriate level of punishment for brands that breached established standards would be a fine of 14.7 percent of their annual revenue.
As a point of reference, survey respondents were told that in data privacy, the penalty for breaking the terms of the General Data Protection Regulation (GDPR) can be up to 4 percent of revenue. Respondents still felt stronger penalties were needed for brands violating consumer trust with fake reviews, according to the report.
“Brands and retailers need to embrace authenticity and transparency and continuously work to combat fake reviews. Shoppers are hardwired to seek word-of-mouth, and we need to ensure they can confidently turn to ratings and reviews as trusted sources,” said Rohrlich.
Call to Action
Bazaarvoice expressed its vision of what needs to be done to remove the growing barriers between consumers and brand reliability. The company offered three golden rules for how companies should protect consumer trust in reviews:
- Do not allow fake content. Fraudulent content can infiltrate your site through a variety of means, including disruptive or trolling activity, commercial messages, automated submissions (e.g. bots, programs and scripts), illegitimate or degrading content by a competitor, and self-promotion by employees. Stay vigilant and put a best-in-class moderation strategy in process, or work with a third-party vendor to combat fake reviews.
- Do not screen out negative content. Instead find value in it. More than half of the survey respondents said that negative reviews are as important as positive reviews in their decision to buy a product. Fake reviews are far riskier and more damaging to a company than negative reviews. In fact, brands that respond to and take action on negative feedback will build trust and loyalty with their customers.
- Be transparent about how you collect reviews. If consumers are offered a free product, promotional material (such as discounts or coupons), or a chance to win something of value in exchange for providing an unbiased review, then the review should explicitly indicate this. There are industry guidelines in place that can help businesses navigate proper disclosure methods.
Negative Reviews Not Toxic
Brands and retailers are more concerned about showcasing negative reviews on their website. Bazaarvoice’s research proves that negative reviews are not what they should be concerned about, cautioned Rohrlich.
“Sixty percent of our survey respondents said that negative reviews are as important as positive reviews in their decision to buy a product, and 23 percent said that they are even more important than positive ones. The majority (62 percent) claimed that negative reviews contain more detailed information on product pros and cons, while 32 percent think that they are less likely to be fraudulent,” he said.
As consumers find negative reviews helpful, so too should brands. Negative reviews not only can tell you how to earn a consumer’s loyalty in the future, but also contain valuable information that can help improve your products or processes or even give you ideas to create entirely new ones, Rohrlich explained.
“We have heard an endless amount of stories from clients that have used the feedback from their customers’ ratings and reviews to help inform all parts of their business,” he noted.
Seventy percent of consumers responding to a recent Sift survey believed online customer reviews were more important than star or numerical ratings. However, 85 percent thought the reviews they read were sometimes or often fake.
Sift aims to help brands combat fraud online via machine learning. In advance of Amazon’s last Prime Day, Sift polled 1,000 U.S. consumers about their experiences, behaviors and perceptions relating to fake reviews. The report found that 71 percent believed all consumer goods needed customer reviews on company websites.
While consumers see reviews as important to inform their purchasing decisions, they do not trust them to be genuine. Eighty-five percent of respondents to the Sift poll believed the reviews they read online were sometimes or often fake or fraudulent.
Despite the growing risk associated with fake reviews, businesses can not turn off reviews because of the major role they play in the buying process, according to Sift. Yet consumer mistrust due to fake reviews leads to dissatisfaction and abandonment.
Some 33 percent of consumers in the Sift study said they returned items or did not purchase them at all due to a fake review. In addition, 40 percent of those consumers said they would never again buy from a business if they felt they were duped by a fake review.
One problem with fake reviews, however, is that fraudsters continue to become more sophisticated, notes the Sift report. That forces businesses to evolve their strategies by adopting new approaches to keep users safe from fraudulent product reviews.
While fake content is not the most malicious type of fraud, it still takes a massive toll on customer loyalty. That, in turn, stunts revenues and growth, the Sift report warns.
Even worse, the threat keeps growing. Some 50 percent of business representatives polled said they expected the posting of abusive and fraudulent types of content would continue increasing over the next 12 months.