Amazon's review-centric approach helped make it a utility for customers worldwide. Still, once companies caught up to the formula, they learned how to cheat it and that cheating had consequences for everyone.
It goes without saying that in the world of online shopping, customer reviews are what matter most. It's a formula Amazon has always understood. In fact, placing reviews front and center from the start has helped make them the behemoth they are today.
Chances are, you don't buy anything on Amazon without reading the reviews first. According to Oberlo's research, only 1 out of 10 consumers don't. At their best, reviews give you all the details that advertising won't _from a source more trusted than a company that wants your money. Reviews are where you'll get your warning if a product is defective or doesn't quite work the way it's been advertised. Likewise, if a product is imperfect but gets raved, your buying confidence shoots through the roof.
The problems with Amazon reviews began as soon as companies figured out how to buy them. What was briefly an honest system soon became flooded with fake reviews by fake bots and suspiciously perfect write-ups from human reviewers who’d been sent the product for free or out and out-paid to spam product pages with their opinions. Below, we break down the cost of fake reviews, both from the consumer perspective and from the very companies who are trying to sell on Amazon.
The Consumer Cost
From the consumer side, the cost of fake reviews has been a slow and steady erosion of trust. According to BrightLocal, 92% of 18-34-year-olds reported reading a fake review last year. Most are easy to spot - short sentences with vague positivity & sparse or underdeveloped profiles attached. The effect is felt across the whole spectrum, as you likely now scrutinize everything you read a lot deeper than you did a decade ago.
Amazon now touts sophisticated algorithms and best practices designed to eliminate blatantly fake reviews and even touted catching 200 million fake reviews (or a third of all reviews submitted) in 2020 - but they are still far from perfect. The Wall Street Journal recently exposed how easy it is for faulty & unsafe products to cheat their way to a coveted "Amazon's Choice" badge. The company introduced the badge in 2015 to highlight well-rated & competitively priced products but has yet to share precisely how its AI determines which products wind up with it.
That lack of transparency has been taken advantage of by companies that have hacked the formula and used any number of tricks to spam their way to prestige. A German company promised 1000 reviews for nearly $11,000 and guaranteed a badge for those who paid more. TechCrunch reports that while Amazon calls for action against "bad actors" like these and has banned many companies from the site, it has yet to outline any specific steps it's taking to protect its customers or crack down on the gaming of the very system it controls. Buying from Amazon has never felt more dubious for consumers who don't have the time to scrutinize every review.
The Company Cost
When consumers lose trust in the market, companies suffer - not just the ones cheating the system, but everyone selling in the system, period. While the FTC has made dramatic examples of some cheaters - recently fining a weight loss supplement business 128 Million dollars, for instance - the effects of consumer mistrust have been felt everywhere.
It's more challenging to get noticed in a crowded marketplace with only a few reviews, as the new understanding is that those reviews could have come from anywhere. So how do you succeed in a market where reviews have never been more necessary, but trust in them has never been lower? Well, you don't cheat the system, for one.
The FTC has strict guidelines beyond the apparent rules against buying fake ones. If your product is being given away for free to garner reviews, for instance, you have to be transparent about that or risk getting into hot water. The irony is that if your reviews carry that disclaimer, they're likely to be less effective.
With a gap in the market for ethically sourced, legally compliant review harvesting, several companies have risen to offer precisely that. Yotpo, Bazaarvoice, and even Amazon Vine have emerged as popular options, but all essentially operate under the sampling or giveaway model outlined in the previous section.
Revioly is newer but is quickly becoming a favorite choice amongst both savvier consumers & savvier companies, as it offers benefits that other services can't provide. Most importantly, their model isn't based on giveaways - companies only pay a fraction of their products' MSRP as they sell.
Revioly's users navigate the site's marketplace for home goods sold by the brands themselves or through retailers like Walmart or Best Buy. Once they purchase their product & receive it, they're prompted by Revioly to submit a thorough, honest & descriptive review to unlock cashback and rewards. The users unlock exclusive pricing by making online reviews more natural, and both the brands and retailers gain new customers & quickly build up reliable online reviews. It's a rare triple-win for all.
To summarize - Amazon's review-centric approach helped make it a utility for customers worldwide. Still, once companies caught up to the formula, they learned how to cheat it and that cheating had consequences for everyone. Rampant mistrust may currently dominate the marketplace, but that doesn't mean it has to stay that way. Trust often pays off in the long run. By adopting a savvy solution like Revioly, companies and consumers can get ahead of the confusion and save big in their own ways while doing it.