According to a report released today by The Competition and Markets Authority (CMA), more than half of UK adults (54 per cent) use online reviews, while six per cent use blogs or vlogs before making purchases.
However, the CMA has heard reports of fake reviews being posted on to online review sites, negative reviews not being published, and businesses paying for endorsements in blogs and other online articles without this being made clear to consumers.
The watchdog has opened an investigation using its consumer enforcement powers into a number of companies in connection with the potential non-disclosure of paid endorsements. The parties directly involved in the investigation are not being named at this stage
Nisha Arora, CMA senior director, consumer, said: “We are committed to ensuring that consumers’ trust in these important information tools is maintained, and will take enforcement action where necessary to tackle unlawful practices."
The findings follow a call for information on online reviews and endorsements issued by the CMA in February this year.
Online review site TripAdvisor supported the recommendations made by the report.
The company said in a statement: “We’re proud to be driving best practices in the sector and we welcome measures to eliminate bad practices in the wider online review industry, which will help to protect consumers and businesses alike.
“We agree with the CMA’s recommendation that all review sites should have appropriate fraud detection measures in place. We have sophisticated systems and teams in place to detect fraudsters, and we have strong penalties in place to deter them.
“We are pleased that the CMA has recognised that online reviews are a hugely valuable, reliable and useful resource, but that bad practices in the wider industry need to be tackled to ensure that consumers are able to get the most accurate information possible.”
Kate Nicholls, chief executive of The Association of Licensed Multiple Retailers (ALMR), called for more stringent policing of the system.
She commented: “Businesses are at risk from misleading reviews and we would like to see further procedures for detecting and removing unfair or malicious reviews put in place along with a formal resolution procedure for disputes and complaints.
“Customers are also at risk and measures to protect them, along with hospitality businesses, such as the identification of paid for listings and greater transparency regarding ratings systems are essential if we are to ensure fairness for users."
“The ALMR will work closely with the CMA as they progress with ICPEN (the International Consumer Protection and Enforcement Network) later this summer.”
Alongside its report the CMA has published advice for businesses on how to comply with consumer protection law on online reviews and endorsements.