Sunday, December 28, 2014

How Honest Are Online Reviews?

These days a lot of people, including myself, rely on online reviews to help make decisions about products to buy and business to patronise. Some of the reviews are very helpful, but often, I've felt suspicious of the ones that are just a little too enthusiastic or well-timed.

Recently, Italy's antitrust authority fined TripAdvisor €500,000 ($600,000) following complaints of improper business practices. The antitrust authority said that TripAdvisor had failed to adopt controls to prevent false reviews, while at the same time promoting the site's content as "authentic and genuine." I'm a regular contributor and follower of TripAdvisor, and the news that TripAdvisor had some authenticity problems begs the question: How honest are online reviews?

According to some studies, 89 percent of U.S. consumers read online reviews at least occasionally, and 39 percent do so regularly. In one famous incident back in 2004, Amazon's Canadian site accidentally revealed the true identities of thousands of its previously anonymous U.S. book reviewers. One insight the mistake revealed was that many authors were using fake names in order to give their own books favorable reviews.

Bing Liu, professor of computer science at the University of Illinois at Chicago, told the New York Times in 2012 that about a third of all Internet reviews were fake, and in a Harvard Business School study of online reviews, it was estimated that 16 percent of Yelp's restaurant reviews were fraudulent! And they are considered one of the best online review sites according to a recent article in Communications of the ACM

The effects of review fraud can be seriously harmful for both consumers and businesses. Sometimes fake reviews are posted by business owners leaving positive reviews for their own businesses, or even negative reviews for their competitors. 

Some online review sites have automated algorithms that watch for likely-fake reviews. Algorithms look to see if one reviewer's opinion consistently runs counter to the majority of reviews, whether multiple reviews share many of the same phrases and typos supposedly from different people, and if reviews have the same IP address for multiple reviews of the same hotel or restaurant.

Another red flag, which an individual can use, is to see if the reviewer has reviewed anything else. A single review could be fake. On the other hand, it's certainly possible for someone to legitimately post just one review -- for example, if they join TripAdvisor specifically to rave or complain about someplace they recently visited. In short, consumers should take online reviews with a grain of salt before making any spending decision.  

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