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Chlu Network

How to Fight Fake Reviews:

Saving your business from the epidemic of fake reviews online

Dilbert by Scott Adams

The problem of fake reviews

Fake reviews are a well known and global problem. Reviews are highly manipulable. A reporter at Vice demonstrated just how much by using fake reviews to push his garden shed to the #1 rated restaurant in London on TripAdvisor. As funny as the story is, it points out something very tragic — review sites can no longer be trusted.

It is estimated that as many as 1 in 5 reviews on Yelp are fake according to one study in 2013. And this is after Yelp’s screening process which rejects about 25% of submitted reviews as likely fakes. TripAdvisor has also tried to implement safeguards against fake reviews, which helped them identify 60 review farms in 2015. But type in “TripAdvisor Review” or “Yelp Review” in Facebook Search and 100s of groups will pop up offering fake reviews. And things are only going to get worse — researchers have developed software that can write extremely believable fake reviews online. These fake reviews are undetectable by review sites and considered “highly reliable” by readers, posing a very real threat to these review sites.

Amazon is also struggling with its fake review problem. Experts estimate that between 9% to 40% of reviews on Amazon are fake. Put your favorite product into Fakespot to see just how bad the problem is. When Hillary Clinton published her memoir of the 2016 US presidential election, hundreds of users took to Amazon to leave reviews. Within 24 hours, there were over 1500 reviews of the book — and only 338 were from users with verified purchases. After 48 hours, only 581 reviews remained. Amazon just deleted over 900 reviews it considered to be fake. But can they be trusted to be the judge? After the incident Amazon now requires its users to purchase $50 worth of products before leaving reviews, but this doesn’t guarantee the reviewer actually bought the product.

Why real reviews matter

It’s no surprise this problem exists, reviews are extremely important for the reputation and revenue of your business. There are strong incentives for competitors (and even you) to manipulate reviews to an advantage. But what happens when everyone tries to game the system? It becomes useless. If consumers no longer trust reviews — they definitely won’t trust your business.

“It may be tempting to justify a boost in ratings with a few made-up reviews when you’re convinced everyone else is doing it. But the negative impact on your business far outweighs the temporary lift you might experience.” (Young)

Businesses like restaurants and hotels are most at risk because they rely on sites that are highly manipulatable. Yet, these businesses stand to lose the most from a negative review. A 1% increase in online customer rating for hotels increases sales per room up to 2.68% whereas negative reviews can decrease sales by 2.8%. For restaurants, a 1-star increase in Yelp rating leads to a 5–9% increase in revenue. Ultimately, a customer’s purchase decision depends on perceived value and trust. When these review sites can no longer promise real, valid reviews; this trust breaks down.

How to fix the system

Help fight fake reviews! A few key steps you can take as a business:

1. Use a reputation system that ties your ratings and reviews to a real transaction

When ratings and reviews are tied to a purchase, the potential for fake reviews decreases significantly. This is a huge step towards preventing bots from writing reviews and to block attacks from competitors.

2. Take ownership of your reputation data

If you take ownership of your data then you gain the power to protect it, and control exactly where it is published. This means you can push review sites to improve their standards to prevent fake reviews — and do a much better job at guarding your reputation.

3. Use several marketplaces

The more marketplaces you offer your services on, the more opportunity you have to be seen! You grow your potential customer base with more exposure, and you have opportunity to get many more reviews.

At Chlu, fighting fake reviews is part of our mission. We solve the problem by verifying each review with a purchase. We use IPFS (a peer-to-peer, distributed file system) to store the rating and review with a reference to a transaction made on any* blockchain to provide a proof of payment. When Chlu ensures verified reviews have a real transaction that is independently verifiable on the blockchain — this prevents fakes from users who never made a purchase. *We are starting with an integration for Bitcoin and Lightning Network payments.

Chlu also gives you ownership of your reputation — and that gives you the ability to take it to any marketplace you choose! We leverage DIDs (decentralized identifiers) together with IPFS to tie your reputation data to your digital identity and make it portable. Reputation online is broken. Chlu’s solution helps users to finally own and control their validated reputation.

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