False Impressions: Online Customer Reviews Exposed (cont.)

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For instance, the marketing companies touted their capabilities to get around the safeguards that websites use to try to identify fraudulent reviews. The companies said they would use bogus profiles that were designed to trick website operators into believing that the phony poster was a customer. One company that sought writers to generate fake reviews said candidates must have multiple Internet protocol (IP) addresses, so the fake reviews that a writer posted would appear to come from different people.

“It’s not like some buffoon manager decides in the middle of the night when he’s bored to pump up his hotel,” says Judy Chevalier, who is a professor of finance and economics at Yale University’s School of Management. “It’s professional marketing services, thinking of [customer reviews] as part of a social-media plan.”

RATINGS GAME. An investigation by New York's attorney general found that 19 businesses hired marketing companies to generate and submit fake reviews.

RATINGS GAME. An investigation by New York's attorney general found that 19 businesses hired marketing companies to generate and submit fake reviews.


STAR SEARCH. Businesses want positive reviews for one reason: profit. Likewise, the websites that publish customer reviews have a financial motivation, too. In general, customer-review websites want to tout as many reviews as they can, because more reviews typically results in an increase in page views, and more page views means that the website can attract more advertisers, which results in increased profit for the website, says Jenny Sussin of Gartner. However, bogus reviews are bad for business, too, Sussin says, because advertisers that question the credibility of reviews on a particular website are less likely to spend their dollars there.

Research long has indicated that consumers are more likely to make purchases from websites that feature customer reviews. However, a 2013 survey by market-research company Dimensional Research quantified that. Results of the survey indicated that 90 percent of consumers are more likely to buy an item that gets a high rating from customers. For example, customer-review websites typically ask the customer who posts a review also to rate the product on a scale of zero to five stars. Zero stars reflects the worst rating, while five reflects the best rating.

A 2012 University of California-Berkeley study examined customer reviews that were posted on customer-review website Yelp. The study revealed that an increase of just one-half of a star on a composite customer rating made a restaurant 19 percent more likely to fill its seats during peak dining hours. Furthermore, a 2012 survey by Nielsen found that 70 percent of consumers trust online customer reviews and rank them second only to remarks from family or friends when it comes to recommendations about purchases. As a result, motivation exists for businesses to manipulate consumers through fake customer reviews.

Websites that publish customer reviews play a game of cat-and-mouse with companies that hope to flood the Internet with fake customer reviews, and in 2014 it’s unclear which side ultimately will win, experts say. Travel website Expedia takes the most extreme approach that we found toward making sure that the customer reviews that it posts are authentic. You can’t post a review for a hotel to Expedia unless you book the hotel through Expedia, check in and check out of the property and have your credit card charged for the purchase. Only after that will you gain access to a link that allows you to post a review on the website, says Expedia spokesperson Sarah Gavin. That’s good news for consumers, because it helps to verify that the person who writes the review is an actual customer.

The bad news is that Expedia doesn’t have such requirements for posting reviews on its website about cruises, flights or rental cars that are booked similarly. Gavin says the purchase of cruises, flights and rental cars don’t include the same steps as do hotels because of the nature of such purchases. For instance, cruises that are booked on Expedia are paid for before departure. As a result, Expedia can’t verify that a cruise review is written by an actual cruise customer.

Unfortunately, the verification approach that Expedia uses for hotels is an exception. The result of Expedia’s approach is that it typically has fewer customer reviews about hotels than do other travel websites. From a business perspective, more customer reviews on a website makes the website appear to be more engaging and successful, says Michael Luca, who is an assistant professor of business at Harvard University. Such an environment is why it isn’t necessarily in a website’s best interest to make people jump through extra hoops if they want to post a customer review, Luca says. From a consumer perspective, we believe that unless a website takes deliberate steps to verify that the person who submits a review actually bought the product or service, confusion will continue to reign over what’s fake and what’s real.

Experts say customer-review websites that attempt to catch fake reviews after the fact rely either on a verified review process or on specialized computer algorithms that are too complicated for consumers to understand. They analyze the language that’s used in the review as well as the online reviewer’s footprint to look for evidence that the review might be fake.

For instance, computer analysis of reviews scrutinizes data such as the IP address from which the review originated. Every computer that’s connected to the Internet has a unique IP address, so if a website’s computer-verification program discovers that multiple account profiles originate from one IP address, it’s an indication that the person who writes the reviews is attempting to fill the website with fake reviews, says Bing Lui, who is a professor of computer sciences at University of Illinois-Chicago. A website’s computer algorithm easily can determine that, say, three accounts are from the same IP address and conclude that one person is behind each account, Lui says.

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