Member Article

CEO of Online Retailer says Review Sites need to be regulated

CEO of Furniture in Fashion, Asad Shamim has shared his opinion that a major revision of Consumer Protection legislation needs to take place imminently.
He says: “Although review sites allege that they are GDPR compliant, most of the review sites have a small print, in which the consumer doesn’t either see, or fully understand that they are consenting to their details being used for future marketing. “The retailer is currently at a major disadvantage because the retailer or service provider suffer double-fold in the majority of instances. They are susceptible to negative reviews from individuals who may not have even purchased from them, plus, the retailer must pay the review site for the reviews hosting service. The review sites do not vet each review to verify purchases, so the retailer then deals with the consequences of a negative review.

“At present, all the power lies with the Consumer in world of both retail and online shopping. Consumers can leave a review for a service or product, even before they receive the goods. This may be referred to as freedom of speech, but it gives consumers and competitors the power or the ammunition to hold this against the retailer or service provider.

“In fact, there is very little done by these platforms to verify that these reviewers are actually genuine and verified customers. I believe there should be a 30-day cooling-off period introduced before they can leave a review – whether it is a good or a bad one.” Third-party Review Platforms for Retailers Each industry has its unique review platforms. For example, platforms like Yelp, TripAdvisor and OpenTable are dominant for hospitality reviews. Trustpilot and Feefo are dominant third-party review sites that are used by Interior brands. It is valued that more than 75% of UK consumers check online reviews before making the decision to buy goods or services, with £23bn of UK spending influenced by online reviews each year.

For online retailers in particular, this is often seen as a positive and negative. It is apparent that genuine positive reviews left by consumers can aid as a powerful “push” factor that increases sales. In contrast, it can disrupt the customer sales journey if they were to see a non-verified negative review, which they take to be genuine.

**Fake Reviews are a growing problem for online retailers

Fake reviews are a growing problem for online retailers. In the online retail space, it’s tremendously easy to create a new account on review sites or on Google and leave either a positive or negative review for any business — irrespective of whether you’ve ever purchased a product or service from them. The other hurdle is that a person doesn’t have to be a customer to be entitled to leave a review. They simply can have a “customer experience,” which could be anything from trying to call you and reaching your voicemail to browsing your website. CEO of Furniture in Fashion, Asad Shamim says “As well as verification of a purchase, arbitration services should be used to resolve matters. For instance, a consumer could leave a bad review for a furniture brand, because they have failed to assemble an item correctly. Or they may have purchased an item of clothing in the wrong size and they’ve found it has torn.”

**What is being done to tackle fake reviews?

In June 2019 the CMA initiated a programme of work intended for tackling fake and misleading online reviews.

On 8 January 2020, the CMA printed an update on its programme of work aimed at tackling fake and misleading online reviews. Following an conciliation by the CMA, Facebook acted to remove 188 groups and deactivated 24 user accounts, while eBay permanently banned 140 users.

Under Consumer Protection legislation, traders are under a general duty to use “professional diligence” towards consumers – but to what degree does this require an online marketplace to delete fake reviews posted by (or on behalf of) third parties? Undoubtedly an online platform that hosts products reviews will probably not have the capacity to moderate each review posted on its site. Still, regulators are likely to expect online platforms to take reasonable and proportionate steps to find fake reviews – particularly if they are aware of the problem. Both Facebook and eBay decided to implement measures to enable them to better detect fake reviews, for example using automated detection technology.

**Freedom of speech

You can review anything. This is the UK and your opinions are protected speech. That is where the problem lies for the retailer. It is apparent now that any retailer that offers a product review function for customers on its site must accept the risk that consumers or competitors can easily post negative reviews. This means retailers may have a genuine reason for suspecting that negative comments are not posted by real customers. If a retailer takes out the bad ones, the product review board is no longer “authentic” from a consumer law perspective. Brightpearl commissioned a survey last year, which found, one-third of British shoppers have left a negative review online last year out of 2000 people surveyed.

**Legal Perspective on Reviews by Consumers:

Marium Razzaq, Partner Solicitors from reputable Manchester Law Firm, JMR Solicitors has said:

“At present Consumer Protection legislation does not give protection to the retailer, be it an online retailer, a high street retailer or an organisation that provides services. The only legislation that refers to reviews is the Consumer Protection from Unfair Trading Regulations which again gives further protection to the Consumer. We are extremely privileged to be living in a Country where such protection is provided and where up most importance is given to freedom of speech. However, a thorough review of the current legislation as it stands needs to be carried out and provision should be made for the above changes to be incorporated into legislation such as The Consumer Rights Act 2015 and the Consumer (Contract) Regulations 2013.”
Marketing Perspective on Reviews:

**Freelance Marketing Manager, Saima Omar said:

Online reputation is a huge aspect on marketing and more online-brands are conscious of the importance of getting product or service reviews from their consumers. It seems that no matter how much you try to avoid bad reviews, you’re bound to get that one negative review that could potentially outshine all your positive reviews. As a marketer, with experience working with e-commerce brands, I believe that online reviews, are an unavoidable part of doing business online. Although seen as a large challenge by retailers, it’s comforting to know that research carried out by social commerce specialist Revoo indicates that consumers spend five times as long on a site when they interact with negative reviews, with an 85% increase in conversion rate. I hear and understand that review sites are not as regulated as retailers would want them to be, but maybe a discourse on this will help us make movements that will benefit both the consumer and the online retailer.

This was posted in Bdaily's Members' News section by Asad Shamim .