Posted: Marcus Varner | May 5, 2015


What Amazon's Fake Reviews Lawsuit Means for Consumer Reviews Everywhere

Screen Shot 2015-05-02 at 7.51.22 PMAmazon is on the war path. And that path leads directly toward fake reviews.

For the first time, the massive retail site (as if you didn't know who they were) is going after companies that profit off of posting fake reviews, usually positive ones, on Amazon. The websites being sued, they say, promise to write bogus five-star reviews for customers that pay between $19 and $22 per review, promising that such reviews will cause their customers' products to be featured more prominently on Amazon's search results.

Of course, this problem isn't new for Amazon, and it isn't isolated to just these few reviews-for-cash business. Other incidents include corrupt self-publishing authors and health supplement that gave out coupon codes to its customers for positive reviews. Some people will pay for positive reviews to catapult their products to the top of Amazon's lists; others will pay for negative reviews to hurt a competitor. And, of course, this practice isn't limited to Amazon. Every consumer review site, from Amazon to Yelp to TheBestCompanys is afflicted by this nonsense.

And yet Amazon is definitely making a public example of these companies, suing them for triple fees and, if found guilty, forcing them to cover Amazon's legal fees. Says Chris Welch at The Verge:

"[Amazon is] hitting all of them hard, claiming that each is guilty of trademark infringement, false advertising, and disregarding various consumer protection laws."

But why go to all this trouble and why now? Who cares about a few fraudulent reviews when everyone knows they're just part of the contemporary online shopping experience? What does this unprecedented war against fake reviews mean for consumer reviews in general?

1. Consumer reviews are more important than you thought.

For all the hubbub companies make about the negative reviews they get on Yelp or Angie's List, you'd think that consumer reviews would be top of mind for everyone. Too often, however, they're pushed out of the spotlight by talk of the newest fads from the world of social media. Despite this unjust neglect, consumer reviews hold an essential spot in shoppers' evaluation process that no other gadget or fad can replace.
Way back in 2013, a Nielsen study reported that 70% of global consumers said they trust online consumer reviews, making consumer reviews second only to word-of-mouth from family and friends.

Corey Eridon at Hubspot confirmed this importance when he said:

"More than 8 in 10 [consumers] say user-generated content from people they don't know influences what they buy and indicates brand quality, while 51% say it is actually more important than the opinions of their friends and family, and far more trustworthy than website content."

With consumers more careful than ever about researching and evaluating products before they buy, consumer reviews have never been more important than they are now. And then, in an environment like Amazon, where the positivity or negativity of those reviews are directly tied to sales, this importance is only compounded.

2. Fake reviews hurt the customer experience and, in turn, companies.

Amazon hasn't always protected consumer reviews on the site the way they should've. Back in 2012, the New York Times broke a story about the lengths self-publishing authors would go to in order to get the positive reviews they needed to get more prominence on Amazon for their books (perhaps one of the earliest well-known reviews-for-cash schemes on Amazon), causing Forbes contributor Suw Charman-Anderson to lament:

"The faking of reviews, both positive and negative, is a serious issue... Unfortunately, there is also no motivation for Amazon, or other online booksellers, to clean up their own acts. Amazon exists to sell stuff. They will only begin to care about this if it starts to threaten sales, despite the fact that they could, if they wanted to, make it much harder for people to fake reviews."

If Amazon is going after fake reviews, you could argue that they're doing so out of some altruistic desire to rid the world of untruth. But the greater possibility is that fake reviews are having a noticeable negative impact on their bottom line.

Screen Shot 2015-05-02 at 7.45.30 PMAmazon themselves confirms as much in their recently announced lawsuit against

"Defendants are misleading Amazon's customers and tarnishing Amazon's brand for their own profit and the profit of a handful of dishonest sellers and manufacturers. Amazon is bringing this action to protect its customers from this misconduct, by stopping Defendants and disrupting the marketplace in which they participate."

If that weren't clear enough, Amazon said explicitly:

"While small in number, these reviews threaten to undermine the trust that customers, and the vast majority of sellers and manufacturers, place in Amazon, thereby tarnishing Amazon's brand."

We could also 'sales revenues' to the end of that statement.

If there's one huge signal from Amazon's suit against, it's that consumer reviews are directly tied to the success of the companies and products being reviewed. Those sites that allow their consumer reviews to be tainted to fatten their bottom line, by companies trying to rig the game, or by third-parties who will do it for them tarnish one of the key parts of their customer experience and deal a serious blow to their own credibility.

And finally...

3. Keeping consumer reviews authentic is good for business.

If fake reviews, positive or negative, are extremely dangerous for sites that collect consumer reviews (and the Amazon lawsuit certainly supports this) then the best path forward is keeping reviews as true and authentic as possible. This is the only way to maintain customer trust in reviews and, therefore, make them much more comfortable with making purchases.

First, this means that suppressing negative reviews is bad for business, so long as those reviews true.

Second, this also means, because it's rare for 100 percent of submitted reviews to be the real thing, it's worth it for reviewing-gathering sites to invest in keeping their reviews authentic and filtering out fake or untrustworthy reviews.

And third, this means that review-gathering sites should commit to not bow to pressure-financial, legal, or otherwise-from companies who have received negative reviews to remove those reviews. The same could be said of companies that would pay for top billing on review sites. Consumer reviews, as a vital part of consumers' purchase evaluation process, are something to be protected, not sold to the highest bidder.


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Written by Marcus Varner

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