Illegal trading with product recommendations

Other customers’ opinions about a product or company can influence whether a customer chooses a specific product or a specific company. Many people today use the Internet during their buying process to gather information about a product or to get product recommendations from various test sites or from other customers.

According to the British Competition and Markets Authority (CMA), more than half (54%) of all adult Britons read product recommendations on the Internet. The obvious benefit for customers with recommendations is that they get an objective picture of different companies’ products. Customers then do not have to trust that companies are honest with the pros and cons of their products.

However, the above assumes that customers can trust that recommendations they read from other customers are genuine. What if many of the recommendations that seem to come from other customers are in fact recommendations that the company itself has created or bought? That is exactly what has happened. Purchased recommendations that give high ratings or evaluations to the company that pays or gives really bad ratings and evaluations to other companies’ products. All this to help the company that pays sell more.

There is information about authors trying to sell more books by buying recommendations on the Internet and even the e-commerce giant Amazon has discovered that companies associated with Amazon seem to have bought recommendations of their products. Amazon has found more than 1000 unidentified people who they claim have contributed with false recommendations, and Amazon has, among other things, sued a number of websites that sell false recommendations. Amazon also uses various technical aids to determine which recommendations are genuine and which are false, and then filter out the false recommendations.

What does this mean then? Of course, it can be tempting to buy some recommendations to speed up the sale of a product. However, it is first and foremost illegal to trade with false recommendations because it is against the Marketing Act. Another, and at least as important, aspect is that if customers discover that a company is cheating this way, it can have devastating consequences by causing customers to lose confidence in the company. If the company works in a network or with resellers to sell its products, the company also risk that the rest of the network or resellers lose confidence in the company. How can such a damage be repaired?

A more long-term alternative to buying recommendations is for companies to be more customer oriented. The company must then find out what the customers and the potential customers like and then develop an offer that really suits the customers. The offer includes everything from product design and helping customers in the buying process to offering service and handling incidents. When the company has a strong offer, it can urge its customers to make an honest recommendation without fear that the customers will give a bad recommendation.