On review factories and web-based deception

I've written about the dangers of relying on internet reviews here once before—I also wrote a blog post discussing the practice known as "astroturfing"—but the concept of "review factories" was a new one to me. Of course, I can't say that I'm in the least bit surprised...

In the fall of 2010, [Todd] Rutherford started a Web site, GettingBookReviews.com. At first, he advertised that he would review a book for $99. But some clients wanted a chorus proclaiming their excellence. So, for $499, Mr. Rutherford would do 20 online reviews. A few people needed a whole orchestra. For $999, he would do 50.

There were immediate complaints in online forums that the service was violating the sacred arm’s-length relationship between reviewer and author. But there were also orders, a lot of them. Before he knew it, he was taking in $28,000 a month...

Reviews by ordinary people have become an essential mechanism for selling almost anything online; they are used for resorts, dermatologists, neighborhood restaurants, high-fashion boutiques, churches, parks, astrologers and healers — not to mention products like garbage pails, tweezers, spa slippers and cases for tablet computers. In many situations, these reviews are supplanting the marketing department, the press agent, advertisements, word of mouth and the professional critique...

“The wheels of online commerce run on positive reviews,” said Bing Liu, a data-mining expert at the University of Illinois, Chicago, whose 2008 research showed that 60 percent of the millions of product reviews on Amazon are five stars and an additional 20 percent are four stars. “But almost no one wants to write five-star reviews, so many of them have to be created.”

"Created," in this case, of course means "bought". In this case, you pay Todd Rutherford a few hundred bucks, he goes onto Craiglist and finds a bunch of people to write reviews for 15 bucks apiece, and then he pockets the remainder. Nice business. Unfortunately for Todd, it didn't take long for his business to be exposed as a scam, and GettingBookReviews.com is no longer operational. But many of its competitors no doubt still exist, and it's nearly impossible to know how many there are and which products they're reviewing.

I hadn't seen the research saying that 80% of Amazon reviews were 4 or 5 star reviews, but it's definitely an eye-opening statistic. The take-home lesson here is pretty simple—if you want to know whether the product you're buying on the internet is any good, do your own research. If you outsource your research to "anonymous" internet reviewers, and trust in their opinion without verification, then you'll get what you pay for (actually, you'll get what the company paid for, but I digress).

But if you do insist on trying to discern which internet reviews are legitimate and which are fake, then Barry Ritholtz has passed along a helpful little guide of what to look out for. I'm sure a lot of these tricks will be familiar to many of you already...

Of course, what I would suggest instead is that you do what I already do—ignore the 4 and 5 star reviews entirely, and just read all of the 1 and 2 star reviews, almost all of which are legitimate. Sure, an enterprising company could be paying people to write negative reviews about its competition, but it's much less likely. So if you're looking for advice from internet reviews, that's the place to go. But of course, there are always better places to go...

[Yahoo Finance]
(h/t Falkenblog and Barry Ritholtz)