Reading customer reviews and comparing vendor rankings is now an increasingly important part of the decision to purchase products and services online. According to statista.com”nearly 70% of online shoppers typically read between one and six customer reviews before making a buying decision.”1
However, fake reviews are becoming a problem. According to a study conducted by https://uberall.com/en-gb at the end of 2020, Google, which is the number one business review site in the United States, had a false review rate of nearly 11%. See further at https://uberall.com/en-gb/resources/blog/how-big-a-problem-are-fake-reviews.
In the European Union (EU), regulators take customer reviews and ratings seriously and the new Omnibus Directive (EU 2019/2161) which came into force in November 2021 and amends the Unfair Commercial Practices Directive ( 2005/29/EC) now imposes important new obligations with which e-commerce businesses must comply.
E-commerce businesses must inform their customers of the criteria that determine the ranking of products offered to customers when a customer performs a search. This includes the description of the most important parameters for the classification. This information should be disclosed in a way that is easily accessible from the search results page.
E-commerce businesses that display customer reviews or endorsements should let their customers know if they have a process in place to ensure the review is from an actual customer who purchased or used the product or service. .
This information includes telling customers how checks are done, whether all reviews are posted (negative and positive), and whether those reviews have been sponsored or paid for.
It will be considered an unfair business practice to tell customers that reviews are from real customers if no verification has been done to verify this.
It is also an unfair business practice for e-commerce companies to post their own “fake reviews” or manipulate reviews to make them misleading. Examples given by EU regulators include only posting positive reviews and deleting negative reviews or linking a review with different but related content.
Potential fines for serious unfair commercial practices are now severe, similar to the General Data Protection Regulation (GDPR). E-commerce businesses can now be fined up to 4% of their annual turnover in the EU member state(s) where the infringement took place. To avoid the risk of fines, e-commerce businesses must be transparent to their customers about their customer review process and search ranking criteria.
1 See https://www.statista.com/statistics/1020836/share-of-shoppers-reading-reviews-before-purchase/
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