Review Fraud: Not New, But Also NOT Solved
The Market Ticker - Commentary on The Capital Markets
Logging in or registering will improve your experience here
Main Navigation
Display list of topics
Sarah's Resources You Should See
Sarah's Blog Buy Sarah's Pictures
Full-Text Search & Archives
Legal Disclaimer

The content on this site is provided without any warranty, express or implied. All opinions expressed on this site are those of the author and may contain errors or omissions.

NO MATERIAL HERE CONSTITUTES "INVESTMENT ADVICE" NOR IS IT A RECOMMENDATION TO BUY OR SELL ANY FINANCIAL INSTRUMENT, INCLUDING BUT NOT LIMITED TO STOCKS, OPTIONS, BONDS OR FUTURES.

The author may have a position in any company or security mentioned herein. Actions you undertake as a consequence of any analysis, opinion or advertisement on this site are your sole responsibility.

Market charts, when present, used with permission of TD Ameritrade/ThinkOrSwim Inc. Neither TD Ameritrade or ThinkOrSwim have reviewed, approved or disapproved any content herein.

The Market Ticker content may be sent unmodified to lawmakers via print or electronic means or excerpted online for non-commercial purposes provided full attribution is given and the original article source is linked to. Please contact Karl Denninger for reprint permission in other media, to republish full articles, or for any commercial use (which includes any site where advertising is displayed.)

Submissions or tips on matters of economic or political interest may be sent "over the transom" to The Editor at any time. To be considered for publication your submission must include full and correct contact information and be related to an economic or political matter of the day. All submissions become the property of The Market Ticker.

Considering sending spam? Read this first.

2018-06-14 07:00 by Karl Denninger
in Company Specific , 119 references Ignore this thread
Review Fraud: Not New, But Also NOT Solved
[Comments enabled]

It's nothing new to hire "shills" who don't disclose their scheme to customers.  In fact it's one of the oldest games out there when it comes to marketing.

It's broadly illegal because it's a crooked practice; it violates the general covenant of fair dealing that always comes with any sort of transaction.  The FTC has very broad authority to go after these issues -- but in fact very, very rarely does.

So is this a surprise? No.

One morning in late January, Jake picked up the box on his desk, tore through the packing tape, unearthed the iPhone case inside, snapped a picture, and uploaded it to an Amazon review he’d been writing. The review included a sentence about the case’s sleek design and cool, clear volume buttons. He finished off the blurb with a glowing title (“The perfect case!!”) and rated the product a perfect five stars. Click. Submitted.

Jake never tried the case. He doesn’t even have an iPhone.

Jake then copied the link to his review and pasted it into an invite-only Slack channel for paid Amazon reviewers. A day later, he received a notification from PayPal, alerting him to a new credit in his account: a $10 refund for the phone case he’ll never use, along with $3 for his trouble — potentially more, if he can resell the iPhone case.

Why isn't this stopped?  It's not easy to stop, for one thing.

But could Amazon stop it?  Absolutely.  How?  You have to buy something from them to review it, directly at retail.

Now it gets much more complicated for the schemers.  In order to run this scam you'd now have to actually front people the money in advance or they'd be at risk you'd never pay them.  The sales would be at retail, which means Amazon would get both the shipping and gross sales price through them, along with their commissions.  And in the case of Chineesium garbage products this would likely make the scam not worth it because a huge part of how it's done now has to do with the crazy subsidized "e-packet" delivery our government allows on an idiotic basis plus the fact that the seller's cost is his actual wholesale production cost for the items he sends out, not the retail cost (on which Amazon gets a commission.)

In addition anyone trying to make an actual business out of reviewing fraud would face an intractable problem -- a complete record of sales they had to engage in first, since you would have had to buy the product on Amazon before you could review it.  This would make court challenges quite-easy to win, and worth it too.

But Amazon doesn't care, in truth, about any of this.

Their goal is to sell "more stuff", and if "more stuff" means glowing reviews that are false help, well....

Go to responses (registration required to post)
 

 
Comments.......
User: Not logged on
Login Register Top Blog Top Blog Topics FAQ
User Info Review Fraud: Not New, But Also NOT Solved in forum [Market-Ticker]
Whitehat
Posts: 493
Incept: 2017-06-27

The People's Republic of New York
Report This As A Bad Post Add To Your Ignored User List
have been told by a Amazon user that the company does note which reviews are from "verified purchaser" of sorts, however one has to look closely. when he showed me on his smartphone it becomes obvious that with the restricted screen size and glare that this would not be readily visible. and we know that so much shopping is done on these **** phones lately; it is next to impossible to critically search on one of these things. he got a three minute lecture on anti-trust and why Amazon is a corrupt org.

----------
There are two ways to be rich: One is by acquiring much, and the other is by desiring little.
snow, seasons, distance and dirt roads: SSDD
"Be not deceived; God is not mocked; for whatsoever a man soweth, that shall he also reap" (Gal. 6:7)
Tickerguy
Posts: 153223
Incept: 2007-06-26
A True American Patriot!
Report This As A Bad Post Add To Your Ignored User List
Yes they do but why allow non buyers to post reviews at all?

----------
Winding it down.
Mangymutt
Posts: 586
Incept: 2015-05-03

Vancouver WA
Report This As A Bad Post Add To Your Ignored User List
If people no longer need a penis to be a male,or breasts to be female

If they no longer need to be black to be black any more.

If people do not need to invest, work hard or money to be rich any more.

Why on earth should they have to buy something to tell someone if it is good or not?
Tripseven
Posts: 61
Incept: 2012-04-26

Report This As A Bad Post Add To Your Ignored User List
I stopped using spermazon reviews quite some time ago after watching critical reviews disappear when I knew damn well the review was accurate. Pretty much means the whole review system is tainted.

I just use forums now as BSers typically get pummeled by an army of forum members. But you still have to keep an eye on those with skin in the game moving products.

----------
Please God, take it all away!
Aquapura
Posts: 737
Incept: 2012-04-19

South of Canada
Report This As A Bad Post Add To Your Ignored User List
I knew Amazon reviews were bull**** when I went to find a splitting axe and half the reviews talked about how good the product was for killing zombies. Amusing to read but in no way helpful in making a purchasing decision.
Asimov
Posts: 109881
Incept: 2007-08-26

East Tennessee Eastern Time
Report This As A Bad Post Add To Your Ignored User List
I find reading the 1 and 2 star reviews more helpful on amazon.

You'll always get the "it didn't work when I got it" ones, but the ones that put some thought into the low star post often are more useful than the shills.

----------
It's justifiably immoral to deal morally with an immoral entity.

Festina lente.
Gnoob
Posts: 2
Incept: 2018-03-23

Report This As A Bad Post Add To Your Ignored User List
Another little trick Amazon uses to mislead customers on reviews: the lowest rating you can give is 1 star, not 0 stars.

Most people would interpret a 3-star rating on a five-star scale as "above average" but in fact it is exactly in the middle.
Aztrader
Posts: 7997
Incept: 2007-09-10

Scottsdale, AZ
Online
Report This As A Bad Post Add To Your Ignored User List
We have had issues with non-buyers giving us bad reviews either from competitors or just stupid libs that don't like anything that looks like a gun. This can work against a retailer having a competitor paying for bad reviews.
Getting reviews that are real on Amazon can be tedious. They want you to fill out a dissertation on the product and since most Amazon buyer's are lazy and only interested in a cheap price and fast delivery, we almost get no reviews.
Amazon is really becoming a thorn in our side. They own every key word on Google making it almost impossible for anyone to find us. They are a monopoly being subsidized by Google, Yahoo, USPS, UPS and Fedex. I look for specific products from distributors and go to Amazon and find them selling the product at my wholesale. The only way they can do this is if they are buying directly from the manufacturer with minimal mark-up which is unlikely, or buying from my same distributor with no mark-up in order to kill off all the retailers.
This is one of the worst cases of anti-trust in history.

Vernonb
Posts: 2122
Incept: 2009-06-03

East of Sheol
Report This As A Bad Post Add To Your Ignored User List
I've had reviews pulled by Amazon that pointed out products that were scams as air an "COMPRESSOR" that boosted mpg by mounting it on the air intake. It was nothing but a pinwheel in an enclosure.

It defied the laws of physics. So what if it increase velocity....it's total cfm that really matters. I can speed up anything by creating a restriction. Nothing but Chinese/Indian trash.

100s of favorable reviews - morons and crooks.

I always check the one star reviews first.

----------
"Mass intelligence does not mean intelligent masses."
Tsherry
Posts: 1221
Incept: 2008-12-09

Spokane WA
Report This As A Bad Post Add To Your Ignored User List
I put as much faith in Amazon reviews as I do in the quality of Harbor Freight tools.

----------
Omne mendacium est.
Marc2mrkt
Posts: 550
Incept: 2008-04-12

Taipei
Report This As A Bad Post Add To Your Ignored User List
If anyone wants to read a long but interesting review of something similar, take a look at this: https://deep-throat-ipo.blogspot.com/201....

aztrader is going to love this one

Ckaminski
Posts: 4685
Incept: 2011-04-08

Mass-Hole!
Online
Report This As A Bad Post Add To Your Ignored User List
Quote:
Revenues for the "Top 10" and Amazon have grown from $304 Billion in 1997 to a whopping $1.323 Trillion (Including Estimated GMV) in 2017.


Marc, assuming 50% of that is inflation and increased population (wild ass guess), than all of the rest of that "growth" is on the back of companies no longer in business.

Aside from Petsmart, pet stores are all but gone from the landscape. I only know of two within 30 miles of me and they specialize in tropical fish. You can argue market efficiency all you want, but that is quite a bit of economic destruction.

Quote:
If the rest of the retailers would have simply seen what was happening, thrown up websites, redeployed their capital and started doing eCommerce like gangbusters


There's not a single company on that list that didn't do eCommerce. They just weren't saddled with a ****-ton of physical property to pay for. Amazon had a distinct advantage. Walmart has a HUGE distribution and market cloud advantage over all the others.
Tat668
Posts: 2903
Incept: 2007-09-09
A True American Patriot!
Report This As A Bad Post Add To Your Ignored User List
"I always check the one star reviews first."

+1, as in fact it the only one I read on Amazon reviews.


----------
"This marks the beginning of the end."- Barack Obama 2-26-09
Lobo
Posts: 476
Incept: 2013-12-25

Report This As A Bad Post Add To Your Ignored User List
I have noticed that, especially with anything electronic, there are lots of 5 star reviews written in poor English that tout how perfect the product is. That is a good sign that they are fake reviews. I pay more attention to the 2 to 4 star reviews. Usually more thoughtful and recognize that, while the product may be good, it ain't perfect. I also look at 1 star reviews that actually have more than, "Its a piece of crap. Don't buy it."

I was recently looking for a new battery for a Plantronic's phone headset. https://www.amazon.com/Plantronics-65358....

When you look at the title of the item, you see "Plantronics" right next to the title, but when you look over to the right side, you see, "Sold by DirectDeals4U." All the one star reviews say the same thing: it is a knock off of a Plantronics battery. You would think that Plantronics would have one of their lawyers send a nice letter to Spamazon.

----------
Village Idiot
Login Register Top Blog Top Blog Topics FAQ