Fake reviews and advertising
As consumers, it seems we love a seal of approval. This is something CHOICE can provide – with our independent and scientific testing, lack of advertising or government funding, and refusal to accept freebies. But what about some of the other third-party groups that claim to have that authority, such as Brand Power, MediFacts, and What's New (all owned by Buchanan Group)?
These TV spots are presented as news breaks, complete with their own program titles, and give the impression they're reviews from an independent organisation. They typically feature presenters or celebrities giving their opinion on a variety of everyday products as well as the impression these products have been researched, tested and approved.
But here's the rub – these "news breaks" are simply paid advertising, dressed up as a review. Advertising creative director Dee Madigan says that although this kind of advertising is not dissimilar to direct mail, in that it's relatively cheap and aimed at a mass audience, it's far more convincing than a traditional ad because it's positioned as being presented by a third party.
"The way that they are constructed is deliberate – it's like a news break or has a documentary feel," Madigan says. "People assume these groups are like CHOICE, and they've been deliberately created to look like that."
Can they do that? Yes they can, according to Madigan, so long as a company submits a statement to Free TV Australia's Commercial Acceptance Division stating the piece for camera was not scripted. However, as she points out the ad will obviously only show us the positive reviews, and "if you were on the payroll to do this, you'd have to be pretty dumb not to say positive things about the product".
Blogging for a buck
In the world of blogging, it can often be the case that "friends" of ours who recommend stuff for us to buy aren't people we actually know in person.
Successful bloggers can have thousands of unique visitors to their site every day and develop a strong relationship with their regular readers. Thanks to that strong connection, plenty of big brands have come a-calling, offering bloggers freebies or remuneration in return for a positive write-up or review. In the US, blogger Heather Armstrong is rumoured to earn thousands of dollars for a sponsored post on her blog and charges up to US$20,000 for a speaking appearance.
While Australian bloggers aren't in this league, their commercial appeal is on the rise. The Remarkables Group is an agency that represents Australian bloggers in the commercial space. Owner and director Lorraine Murphy says she set up the company after working in advertising and seeing interest in the market for bloggers to do commercial work. Murphy has more than 20 bloggers on her books with online traffic between 80,000 and 135,000 unique users a month. So far the agency has paired the bloggers with a variety of companies as diverse as insurers, supermarkets and retailers.
And it's easy to see the appeal. One of Murphy's bloggers, Nikki Parkinson, is famous for crashing a fashion retail website through consumer demand for a dress she recommended on her blog.
This kind of power doesn't surprise Murphy. "Consumers are looking for people who are like them. It's a peer-to-peer recommendation and the relationship readers have with their bloggers is no different. When we've done research in the past, one of the strongest responses we've had from readers is that [reading a blog is] like catching up with a friend."
What's the catch?
It's all about disclosure – bloggers being upfront about what is a paid or "sponsored" post. Bloggers in the US are legally required to disclose any commercial arrangements, but in Australia they're not. However, Murphy says smart bloggers should do so in the interests of keeping both their integrity and their readers.
But blog fans beware – just because your favourite blogger says they love a product doesn't mean they really do. They might just love the money they're receiving to write positively about it.
Astroturf in your backyard
Websites, chat rooms, forums and Twitter feeds are all places where you'll have no problem finding people with an opinion. And then there are the user-generated review sites for almost everything, some of the better-known being travel review site TripAdvisor, restaurant review site Eatability and sites that review local businesses, such as Yelp.
While these sites can be helpful, they can also be misleading. A 2012 study released by US-based research and technology group Gartner predicted that by 2014, up to 15% of all online reviews would be fake, paid for by companies. The experts we spoke to agree it's a trend that's on the rise.
"It's called astroturfing," says technology director Leslie Nassar, who works with digital advertising agency Amnesia Razorfish. "It's a way of artificially creating the look of a grassroots online trend."
Marketers can even manipulate the trending topics on Twitter by creating hundreds of fake personas to generate their own online buzz. A local example was Channel 7's launch of Dancing With the Stars in 2012. Nassar says he noticed that many of the enthusiastic tweets going to air during the show were from accounts that had only been created a few hours before, and had only one or two tweets on them – all about that show. Checking further, Nassar discovered that while there were 10,000 tweets posted on Twitter that night about the show, of the 20 that were broadcast on air, 25% were from the newly-created accounts.
It's not just fake accounts getting in on the astroturf action. In 2012, a number of high-profile Australians such as singer Shannon Noll and celebrity chef Matt Moran were tweeting their previously unmentioned enthusiasm for Kangaroo Island in South Australia. Later, the ABC revealed that an agency working on behalf of the SA Tourism Commission was paying celebrities $750 per tweet about the island, but had specified that the tweets must appear "organic and spontaneous".
Artificial influencers don't just operate in the consumer world. Even the US Army has reportedly recruited people to create fake personas on social media to promote the US's interests, with a particular focus on the Middle East.
Madigan says it's extremely common for companies to set up fake review sites and personas to review their products. "I've worked for companies that will set up heaps of them."
For example, a whitegoods company might set up a website called fridgereviews.com.au, make sure the site is optimised to rank highly in Google searches and then set up their own personas to submit reviews.
"You can also buy reviews and Facebook 'likes' easily," says Madigan.
Where to from here?
Most of the experts we spoke with said it will be difficult for the law to keep up with emerging technologies, so it's up to consumers to read reviews with caution in the meantime. However, some review sites acknowledge the problem of fake reviews. Yelp recently announced it would start naming and shaming businesses that it caught submitting reviews as well as using its filtering system.
According to Madigan, savvy consumers will drive better behaviour on the web. "The increase in bogus reviews and cash for comment will eventually have an impact on consumers, and people will become less trusting. On the bright side, it's a good opportunity for companies that manage their own content and keep it unbiased. They will be the ones that do well."
What does the law say about fake reviews?
A spokesperson from the ACCC told CHOICE that the Australian Consumer Law (ACL) prohibits "false or misleading testimonials". What constitutes misleading depends on the circumstances, but online reviews are covered.
If businesses are carrying on regular trade by selling goods or services to customers within Australia, the ACL may well apply to representations made in the course of that business.
In November 2012, the removalist Citymove was forced to pay a $6600 fine to the ACCC after it published false consumer testimonials on its (now deleted) MovingReview.com.au website.