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Fake and inaccurate reviews driving billions in ‘wasted’ consumer spending [Report]
American consumers said they wasted $125, on average, in 2019 due to inaccurate reviews, a new report finds. If we extrapolate that across the adult population, as much as $25 billion in U.S. consumer spending has been wasted due to inaccurate (or fake) online reviews.
The report portrays a kind of dissonance or ambivalence among consumers, who continue to rely very heavily on reviews but are also increasingly wary of their authenticity or credibility.
Rise of reliance on reviews. The study, commissioned by reviews platform TrustPilot, was based on a survey of more than 6,300 adult internet users in the U.S., UK and France in December 2019 and carried out by UK-based research firm Canvas8.
Top factors compelling consumers to purchase from a company ranked by the rate of incidence of inclusion in consumers’ top three choices.
Against the backdrop of a decline in trust toward brands and the media, the study found that 48% of U.S. consumers are relying more heavily on reviews today than they were two years ago. According to the report, 89% of consumers globally (and 90% in the U.S.) check reviews online before making purchases.
Perception of companies generating fake reviews. However, nearly half (49%) of consumers also “believe that ‘too many companies’ are creating fake reviews online.” Those consumers worry fake reviews “will lead them to waste money on poor products and services” — hence the $125 figure.
Perhaps the most interesting set of findings involve reactions to 5-star rated businesses. These respondents dismiss 5-star reviews as the likely product of manipulation. Indeed, they’re now less inclined to trust 5-star reviews unless bolstered by negative or partly critical reviews.
A slight majority (55%) of survey respondents said they “would prefer to buy a product with a large number of reviews and an average rating over a product with a small number and excellent rating.” Accordingly, 56% of respondents said they would “consider a 5-star rated product or service, but do more research before committing” and 16% simply believe 5-star ratings are fake.
Five-star reviews less credible. That’s a total of 72% who believe that 5-star ratings are not entirely credible or not credible at all. A separate study from BrightLocal, released in December, found a majority of people (70%) consulted multiple review sites as a way to prevent being deceived by fake reviews.
Finally, 67% of respondents in the Trustpilot survey said that they would rather buy from a company “that seems to have made a small mistake and responded quickly” rather than one that has “never made a mistake.”
Why we care. Most businesses (especially small businesses) seek five-star reviews and want to marginalize or purge unflattering reviews. This data and many other such surveys make clear that’s a mistake. Consumers want to see some mixed reviews to ensure that they’re not being manipulated by fake reviews. The lessons here for marketers are: 1) welcome critical reviews 2) address them in a sincere and not perfunctory way 3) make sure to focus on multiple, relevant review sites as consumers seek validation to protect themselves against fraud.
This story first appeared on Search Engine Land. For more on search marketing and SEO, click here.
The post Fake and inaccurate reviews driving billions in ‘wasted’ consumer spending [Report] appeared first on Marketing Land.
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