Amazon Sues over Fake Reviews: FBA News

Amazon Sues Over Fake News

AMAZON HATES DISHONEST REVIEWERS

Amazon has a “zero tolerance” policy for fake reviews on its platform and has filed hundreds of lawsuits over the years against those businesses and individuals who write or post them.

WHY IS AMAZON SO AGGRESSIVE AGAINST FAKE REVIEWS?

Both Amazon and the Federal Trade Commission consider the use of dishonest consumer feedback to be unfair competition. Specifically, purchasing fake product reviews on an online commerce platform is an intentional attempt to mislead consumers in violation of Section 5 of the FTC Act.

Amazon explained its position to TechCrunch:

“Our goal is to eliminate the incentives for sellers to engage in review abuse and shut down this ecosystem around fraudulent reviews in exchange for compensation. As long as this type of abuse exists, we will continue to take enforcement and legal action against sellers participating in fraudulent reviews.”

“DISCOUNT-FOR-REVIEWS” ARE ALSO PROHIBITED

Amazon’s purge of incentivized reviews on its site also includes “discount-for-review” programs. Such programs were at one point an extremely important marketing tool for startups and even led to the creation of an entire promotional services niche: “feedback facilitation.” However, many companies may have to return to traditional advertising for their e-commerce activities.

WILL AMAZON’S NEW POLICY HAMSTRINGING STARTUPS?

Amazon’s recent crackdown on fake reviews has sparked concern for smaller sellers attempting to compete on the platform. By prohibiting relatively cheap, although dishonest, advertising strategies, Amazon may force startups to increase their initial marketing spend.

DIFFICULT BUT NECESSARY?

Amazon’s motivations for its aggressive review policy may extend beyond consumer protection. It is possible that the company’s strategists determined that its third-party selling programs were growing unsustainably and were becoming PR time bombs.

As the world’s largest online retailer, Amazon has a huge target on its back. Amazon’s competition would take any flaw in the company’s public image as an opportunity to steal part of its market share. No consumer would engage with a platform with a reputation for fake goods and dishonest reviews.

ADJUST TO SURVIVE

Amazon’s policy changes mean that FBA sellers must adapt their methods to surviving. Brands and marketers should consider:

  1. Decreasing the initial price of their products,
  2. Encouraging consumers to leave reviews,
  3. Diversify their “Off Amazon” marketing efforts,
  4. Surpassing consumer expectations. Happy customers are more likely to leave a review. A “surprise gift” strategy can also serve as a counterfeit deterrent.

NEED ADVICE FROM AN AMAZON E-COMMERCE ATTORNEY?

RM Warner helps business owners navigate the waters of online reviews, in addition to other Internet business issues, like account suspensions, counterfeiting, and intellectual property troubles.

DEALING WITH AN ONLINE REVIEW SETBACK? LET’S FIX IT

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