Why is a Closed Reviews System Important for a Company’s Integrity?

21.12.2017, 7m

When I’m shopping on a new website, one of the first things I’ll do is check out the seller’s reviews to see what kind of experience other shoppers have had with them.

Naturally, I’d expect to find varying reviews with some going into great detail about the customer’s experience and opinions, while others are simply “Product worked. Fast delivery.” Clearly, all reviews are not created equally. However, review systems are not created equally either and that is something consumers (and some business owners) don’t necessarily think about when they think about online reviews. In today’s article we’ll be looking at what a closed review system is and what the advantages are of using one. 

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What is a closed review system?

A closed review system is actually a very simple concept. It means that only verified customers can leave reviews for a company. On the other hand, an open review system allows absolutely anyone to leave a review. This kind of system is deeply flawed with a huge opportunity for foul play.

Now that you know what exactly a closed review system is, let’s look at what advantages there are to using one.

Authentic feedback

If you’re a business owner who is truly concerned about the customer experience, then feedback is immensely important to you. By getting reviews from real customers, you know that their experiences, no matter how unique, are going to be authentic.

customer_reviews.jpgA good company cares about real feedback from their customers. 

With real feedback, you can actually fix the things in your company that aren't working. If the customer support process takes too long time, you’ll know about it. If the website is confusing, you’ll know about it. If the package takes too long to arrive, you’ll know about it.

If a specific product is getting negative reviews, you’ll know about it. You see where this is going. Verified customers give authentic feedback. With that knowledge, you can take action and optimise your shop, whether that means improving the service to your customers or removing a certain product from your product line. 

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Limit fake reviews

The most obvious reason to have a closed system is to protect businesses and consumers from fake reviews.

The biggest problem with open review systems is that absolutely anyone can leave a review. So, naturally businesses could (and do) write themselves glowing reviews, which is obviously completely unethical. By the same token, an open review system allows for one business to write false reviews for their competitors to make them look bad - equally unethical.

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A quick search on reddit reveals that some companies pay users to write reviews. Open review systems are clearly exploitable. 

Clearly, there are some very basic problems with an open review system. However, these simple flaws have a much darker side that can easily be exploited.

What some open-review system providers do is create public profiles for businesses that are not their customers. As soon as negative reviews start “showing up” for that business, salespeople will reach out to this particular business to “warn” them about the impact negative reviews can have on their business.

Naturally, these businesses are not allowed to address these negative reviews without paying for a subscription to that reviews provider. This could easily be interpreted by some as a strong-arm tactic to acquire new customers.

dark_side_reviews.jpgEvery industry has its dark side. The business of online reviews is no different.

In the worst case scenario, it’s possible that the review company could secretly create these negative reviews themselves and entice their would-be clients with a promise to delete them once the business has signed up with them.

In the best (less worse) case scenario, competitors could simply write negative reviews on the site, which would still force a legitimately good business to feel pressured into subscribing to this review platform just so they can respond and have some control over these negative reviews.

This might seem like a wild claim or a conspiracy theory, but it seems many business owners have had something like the “worst case scenario” situation happen to them.

The Danish Broadcasting Corporation (DR), which is basically the BBC of Denmark, released multiple articles on small business owners feeling pressured into signing up with Trustpilot (also based in Denmark) in the last few years. Their stories reveal some questionable business practices from the review provider.

the good and the bad

Apparently a small beauty clinic owner, Camilla Rude, realised she had a few negative reviews on her business’s Trustpilot profile. Because it is an open review system, she invited some happy customers to leave reviews for her site to offset the negative ones she had received shortly before. Trustpilot rejected 7 of these positive reviews, claiming that there were strong indications that these reviews came from the same device.

To be fair, the reasoning provided by Trustpilot actually sounds reasonable. There is definitely something suspicious about seven reviews coming from one device.

However, when some negative reviews popped up a few months later, Trustpilot claimed that “strong indications” showed that these negative reviews also came from the same device, yet allowed these reviews to be publicly posted.

It seems like a double standard, but when you consider that Camilla was not a Trustpilot member, you can draw your own conclusions as to why the negative reviews were allowed to be posted and the positive ones weren’t.

From a business perspective, the more negative reviews a business has, the more urgent it is for that company to take action and  control their reputation.

The  company that hosts those reviews has a very powerful argument to sell this business owner "access" to those reviews - if not the power to delete or hide them, then at the very least the power to respond to them. 

It's no wonder that small business owners often feel like they are at the mercy of such review providers and some have gone as far as to compare them to a mafia.  

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There is an almost endless supply of blogs and forum comments from consumers complaining that their fair reviews were rejected simply because they were negative.

Even after customers verified their purchases by sending proof of their transactions to the review provider, they were still denied the right to post their negative reviews.

Finally, another report from DR mentioned two separate studies that revealed shady practices from the review provider. One study performed by Dwarf researched the 50 most popular online stores in Denmark to compare their ratings on Trustpilot.

The results showed that the difference between the average ratings of a Trustpilot client and the ones who aren’t was noticeably large (5.8 vs 8.6). Is this an anomaly?

Well, the second study mentioned in this article compared the ratings of a company before they became a paying customer and their score after paying Trustpilot for their services. Some of the examples mentioned showed a change for Elgiganten going from 6.0 to 8.5, BavySam rises from 5.2 to 7.5 and Skoringen going from 3.3 to 8.2, with many of these shifts occurring practically overnight!   

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It is concerning that these review scores can seem increasingly misleading to consumers and can change so drastically as soon as a contract is signed. After all, reviews are meant to benefit consumers with unbiased feedback, not to protect businesses from the truth coming out.

When open review systems allow anyone to write a review, there are simply too many loopholes to allow companies to manipulate their reputation unethically.

As more articles, blog posts, and forum comments continue to be written on the topic, it is encouraging to know that the general public is becoming more aware as to what is happening here (and I didn’t even mention that buying reviews is a BIG business. Hint: bad idea!).

Trustpilot facebook groupA Facebook group that lets business owners exchange reviews for companies they've never actually used.

True satisfaction rates increase

When customers read real, unbiased reviews, they are getting a more balanced view of what a company is really like. Therefore, there is less surprise when they finally do receive their product. This means that there is a much lower chance that the customer will feel misled about the company they’re doing business with and there’s a good chance they will do business with that particular business again.

Besides the warm, fuzzy feeling you might get from knowing that your customers are getting what they expect, the financial motivator for you, as a business owner, is that you’ll get fewer returns on these products because customers actually got what they expected.

Face up to negative reviews - don't hide them!

It really all comes down to trust. All review providers want to keep their clients happy. After all, businesses pay for using review systems, not end-consumers. However, there is a clear, ethical line that shouldn’t be crossed when it comes to proving your reputation.

No business wants negative reviews on their site, but negative reviews can actually be a blessing in disguise. In fact, many consumers are not bothered by the presence of negative reviews (some people even see it as a sign that the shop is real).

What they do pay attention to is how a company reacts and also how quickly they react to the complaint. If a business addresses their negative feedback and take care of their customers, other shoppers will definitely notice. Instead of hiding your poor reviews, your business should work hard at improving customer satisfaction.

Check out our free whitepaper below on how to deal with negative reviews

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