E-commerce giant Amazon is reportedly suing the administrators of over 10,000 Facebook groups that have been offering compensation to people from multiple countries for leaving fake product reviews on the site to mislead buyers.
In a blog post published yesterday, the company stated that the lawsuit was filed this Monday and that the company plans to use the information it gathers during the discovery phase of the proceeding to “identify the bad actors and remove fake reviews” from its platform.
According to the company, a single group called “Amazon Product Review” had 43,000 members before it was shut down by Facebook’s parent company, Meta Platforms. Amazon’s investigation revealed that the administrators of the group used different techniques to avoid being caught by Facebook’s detection software, partly by altering the words and phrases that are typically flagged by the algorithm.
Amazon has been fighting these groups for years. The company stated that, since 2020, it has reported over 10,000 of these communities to Meta with more than half of them being taken down by the social media platform for violating its policies.
In that particular year, the company also said that it stopped around 200 million fake reviews from being published on its site through the use of “industry-leading tools”.
On 6 May this year, Amazon also announced that they took legal action against brokers of fake reviews. Four companies including Fivestar Marketing, Matronex, Extreme Rebate, and AppSally were named in the blog post as the bad actors that promoted this practice.
Around 350,000 people allegedly used these platforms to willingly write fake reviews in exchange for monetary compensation. In the case of Extreme Rebate, Amazon cited that the platform paid $4 and in some cases free products per every fake five-star review containing over 15 words including images and videos if possible.
“By taking legal action against these fraudsters, Amazon targets the source of the problem and sends a clear message that we will hold fake review brokers accountable”, the company stated.
Last year, Amazon also published a blog to inform its users about everything the e-commerce platform is doing to prevent the publication of fake reviews. According to the company, social media platforms like Facebook take an average of 45 days to shut down these groups after they have been reported by Amazon.
Product Reviews Have a Huge Impact on Sales
Product reviews are considered important by shoppers as they should provide first-hand opinions from other buyers who have already received and interacted with a certain product. Their purpose is to help consumers in making more informed decisions when buying a product.
According to a report from the Spiegel Research Center, the inclusion of customer reviews on a product page could lead to a 200% jump in conversions for low-priced goods and a 400% leap for the high-priced category.
Research from G2, a company that provides advisory services in the tech space, coincides with Spiegel’s findings as the firm found that 90% of buyers are more likely to convert after they have read online reviews.
In addition, G2’s research found that at least 61% of people who end up buying something from a website read between 11 and 50 reviews on average before completing their purchase.
Buying a Fake Review is Cheap for Sellers
The elevated effectiveness of online reviews in boosting conversions and sales has attracted bad actors to the space who offer compensation to people – primarily via social media groups like the ones Amazon is suing – for leaving misleading reviews.
Consumer protection advocacy groups have also been raising attention toward this issue. Some reports have revealed that it may cost a business around $10,000 to buy up to 1,000 fake reviews on Amazon.
Many companies that advertise and sell products on the e-commerce platform consider this a regular marketing effort and possibly one of the most profitable initiatives considering the return on investment.
For Amazon, banning product sellers whose goods have received several fake reviews may also work in fighting against this practice.
If a certain product is receiving so many fake reviews, it is highly likely that the company that is selling the product has hired a fake review broker or has had direct involvement in the unlawful scheme.
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