Paid-for reviews, ‘likes’ and ratings is becoming commonplace on social media and review sites, and will account for 10%-15% of all the reviews by 2014, according to a new report by Gartner.
The IT advisory firm predicts that increased media attention on fake social media ratings and reviews will result in at least two Fortune 500 brands facing litigation from the U.S. Federal Trade Commission (FTC) over the next two years.
“With over half of the internet’s population on social networks, organisations are scrambling for new ways to build bigger follower bases, generate more hits on videos, garner more positive reviews than their competitors and solicit ‘likes’ on their Facebook pages,” said Jenny Sussin, senior research analyst at Gartner. “Many marketers have turned to paying for positive reviews with cash, coupons and promotions including additional hits on YouTube videos in order to pique site visitors’ interests in the hope of increasing sales, customer loyalty and customer advocacy through social media ‘word of mouth’ campaigns.”
Organizations who opt to pay for phoney reviews can, and have, faced both public condemnation as well as monetary fines.
In 2009, the FTC determined that paying for positive reviews without disclosing that the reviewer had been compensated equates to deceptive advertising and would be prosecuted as such.
“Marketing, customer service and IT social media managers looking to use reviews, fans and ‘likes’ to improve their brand’s reputation on social media must beware of the potential negative consequences on corporate reputation and profitability,” said Ed Thompson, vice president at Gartner.
As the FTC begins to crack down on this practice of fake reviews/ratings, some reputation management companies are taking a different approach, not posting new, fake, favorable reviews, but identifying fake and defaming reviews and requesting the reviewers or host site remove them or face legal repercussions. Gartner analysts said they expect a similar market of companies to emerge specializing in reputation defense versus reputation creation.
Gartner believes that although consumer trust in social media is currently low, consumer perception of tightened government regulation and increased media exposure of fake social media ratings and reviews will ultimately increase consumer trust in new and existing social media ratings and reviews.
“Organizations engaging in social media can help to promote trust by openly embracing both positive and negative reviews and leveraging negative reviews as a way to encourage customers with positive product or service experiences to share them on review sites as well,” Ms. Sussin said.”They should also respond to ratings and reviews in an official capacity to demonstrate willingness to engage in productive conversation with anyone.”
Jim O’Hara, president of Ecwid, comments on Gatners findings: “It isn’t surprising that the number of fake social media reviews is a growing problem. Social commerce in particular is on the rise as businesses look at platforms such as Facebook as a new route to show-off products and engage with customers. For instance, our own data has shown that the average value for a Facebook ‘like’ is £13.53, which highlights that social commerce is a potentially profitable channel for many businesses.
“Fake reviews or ‘likes’ are a serious concern for those who have worked hard to engage with their customers and encourage them to leave a genuine review, as they serve to undermine their value. Creating customer trust should be of paramount importance, so it is very encouraging to hear earlier this month that Facebook is cracking down on fake ‘likes’ and removing those that aren’t genuine.”
Additional information is available in the Gartner report “The Consequences of Fake Fans, ‘Likes’ and Reviews on Social Networks”.
The report is available on Gartner’s website here.
