Customer reviews are an extremely important — and influential — method of building trust with potential customers. 98% of consumers say that reviews are essential when they’re making a purchase decision. But 81% of consumers are worried about coming across fake reviews — which is a very real concern in today’s day and age.
The Federal Trade Commission (FTC) recently proposed a new rule that would ban fake reviews and testimonials. Any businesses who violate these guidelines would have to pay a fine of up to $50,000 (yikes!).
Here’s what you need to know about the proposal and, if passed, how it might affect your business.
The FTC’s new proposal on fake reviews
In summer 2023, the Federal Trade Commission announced a new set of proposed rules designed to stop marketers from using illegal review practices such as paying for positive reviews. According to the FTC, AI is making it easier to obtain fake reviews, but these kinds of practices deceive consumers and punish honest businesses.
The proposed rule would prohibit:
- Selling or obtaining fake consumer reviews and testimonials
- Review hijacking
- Buying positive or negative reviews
- Insider reviews and consumer testimonials
- Company-controlled review websites
- Illegal review suppression
- Selling fake social media indicators
The Commission is reviewing comments (file a comment here by September 29th, 2023) before deciding whether to issue a final rule.
Illegal review practices to avoid
The FTC specifically mentioned seven illicit practices that the proposed guidelines would affect. Violators who continue to practice these tactics will be fined. Take a look at each illegal activity and what you should do instead.
#1. Selling or obtaining fake consumer reviews or testimonials
First up: The FTC states that fake reviews have always been against the law because they mislead consumers. If you purchase a fake review of your business, you are essentially lying to your customers, prospects, and anyone else who reads it. This hurts consumers as they try to make smart buying decisions. What’s more, it also has an impact on honest businesses who actually do have genuine reviews online.
What to do instead
Never work with fake reviews. Instead, ask your real-life customers to share their actual experiences with your brand. Ask them for feedback right away through channels like email or site popup, and make it as easy as possible for them to leave a review. And remember, the best way to get positive reviews is to provide good service.
#2. Review hijacking
Review hijacking is the process of taking a customer review that was written for one product, and applying it to another. When you hijack a review, you make that review look as if it was for a product the consumer never actually purchased or used. This is another way that businesses might be dishonest to their customers. The FTC states that this is false advertising — which is why it’s on the “no” list.
What to do instead
It’s okay to use review variations for child products or products that are more or less the same (for instance, the product title could apply to both). But that’s where you should stop. Don’t swap out reviews or alter what the customer wrote. And if a product doesn’t have enough reviews, consider it time to market that product more and source reviews the honest way.
#3. Buying positive or negative reviews
If you have ever offered an incentive to a customer in exchange for them to write a positive review, you have essentially “bought” a review. Some companies even go so far as to use websites that let you buy fake reviews.
Offering an incentive for reviews isn’t always bad. You can give customers a small discount or a free gift if they write a review of their honest experience (with no requirement that the review is positive). But according to the FTC’s proposed new guidelines, businesses would “be prohibited from providing compensation or other incentives conditioned on the writing of consumer reviews expressing a particular sentiment, either positive or negative.”
What to do instead
Ask for reviews — but don’t require them to be positive. Simply follow best practices to approach customers and ask them to write a genuine review about the product and overall experience. This is a much better route because you’ll get high-quality, accurate reviews that provide honest feedback on how you’re doing.
If you do receive negative reviews, don’t hide them. Consumers tend to be suspicious when they can’t find any negative reviews: 46% of shoppers feel wary of products or retailers with a perfect 5/5 star rating. Leaving up your negative reviews (and engaging with them to fix the problem) helps with transparency and trust.
#4. Using insider reviews and consumer testimonials
Another practice the FTC’s rules would ban is insider reviews. According to Trustpilot, in 2021, over 8,000 reviews of U.S. businesses were written by the company’s owner, officers, employees, or their family members.
This might be a tempting idea. But doing so will cause your website and your business to lose credibility. You can’t help but be biased. What’s more, Google might detect these fake reviews and flag your business, hurting your SEO.
What to do instead
If you’re concerned about your online reputation, try using a reputation manager. This professional helps control your company reputation and make sure it’s overall positive. They might:
- Align your messaging across channels
- Respond to customer reviews
- Share reviews on your social media or website
This can be a helpful, safer option.
#5. Setting up company-controlled review websites
Some businesses set up websites or entities that are designed to review or endorse their own products. This (along with many of the other practices on this list) is known as “astroturfing.” Essentially, astroturfing refers to improving your online reputation through fake comments or paid reviews. It is unethical — and under the FTC’s new guidelines, it could be subject to a hefty fine.
What to do instead
You don’t need to set up your own (illegal) review site when there are already so many existing high-quality websites where consumers go to read reviews. Claim and manage your profile on platforms like:
- Amazon
- Sitejabber
Sitejabber, a third-party review website, also offers a business platform called Jabio. With Jabio, you can take control of your online reputation and review strategy with over 10 various review collection tools, streamlined review monitoring and publishing, and so much more. Click here to learn more.
#6. Participating in illegal review suppression
If you are deleting or suppressing negative reviews, your website cannot claim that the reviews you do show are most or all of the total reviews you’ve received. Some businesses even go so far as to threaten consumers (legally or physically) if the consumers don’t delete negative reviews. Each year, companies across the world hire thousands of lawyers to intimidate people who write negative reviews.
We shouldn’t have to tell you that this is wrong. The Consumer Review Fairness Act (CRFA) protects people’s ability to share their honest opinions about a business’s products, services, or conduct, in any forum, including social media. It’s illegal to state in your online terms and conditions that you can sue or penalize consumers for posting negative reviews.
What to do instead
Legally, it’s okay for you to remove a review that:
- Contains confidential or private information
- Is libelous, harassing, abusive, obscene, vulgar, sexually explicit, or inappropriate
- Is unrelated to your products or services
- Is clearly false or misleading
But if the review is simply a negative opinion that you disagree with, this doesn’t count. And remember, leaving negative reviews up can actually increase the level of trust that consumers feel in your brand.
#7. Selling fake social media influencers
The final practice mentioned by the FTC has to do with social media: buying fake views, fake likes/engagement, or fake followers/subscribers.
Buying fake followers is against Instagram’s terms of service, too. And it won’t do you any good — fake followers aren’t going to engage with your content or make a purchase. There’s no reason to participate in this shady practice.
What to do instead
The best way to get more followers on social media (followers who will actually buy something) is by creating high-quality content that appeals to your target audience. You can also boost your visibility through tactics like using the right hashtags and cross-promoting your various social channels. Buying ads is legal and helpful, too.
How to spot fake reviews
Wondering how you can tell whether a review is fake? Here’s a quick refresher of some signs to look out for:
- The user profile contains many positive reviews for the same product
- The review uses vague, unspecific wording
- The product/brand name is mentioned over and over
- The review has poor English or copy-pasted text
- The review is very long
These are all red flags that you might be looking at a fake review.
Play by the book
Whether or not the FTC’s proposed rules go through, you shouldn’t be participating in these shady review practices. The best way to gain consumer trust is to play by the book, asking your real customers for their real opinions of your brand.
Jabio can help. As Sitejabber’s business platform, Jabio is designed to help you collect, distribute, and manage the reviews you receive. Click here to learn more and get started today.
