If you operate an online business, online reviews are probably a huge part of your business. Your website itself may have a reviews page, or you may receive reviews from Google, TripAdvisor, or a third party online review platform. It is important to ensure your business’ online reviews comply with the law. This article will discuss the relevant law and provide a few examples and practical tips for online business owners.
The Australian Competition and Consumer Commission (ACCC)
The Australian Competition and Consumer Commission (ACCC) is a regulatory body that enforces various consumer protection laws including the Australian Consumer Law (ACL) and the Competition and Consumer Act 2010. This includes taking action against businesses that do not comply with the relevant legislation. In particular, the ACCC can take action against businesses who engage in misleading and anti-competitive conduct.
Consumers often like to read others’ opinions about an online business before they decide whether to use the business or make a purchase. They should be able to expect that the reviews they read are genuine and unbiased, and be able to trust the reviews. If a business or review platform does not remove reviews that they know are fake they may be in breach of the Competition and Consumer Act.
Managing Online Reviews
The ACCC provides a few useful guidelines for managing your business’ online reviews. In addition to explaining to users how you gather online reviews, the ACCC suggests that you do not:
- publish, or ask people to submit, reviews that are false or misleading. For example, do not ask someone to post a positive review in return for a discount on their next purchase as this may encourage reviews that are not genuine;
- publish fake reviews about your competitors;
- invite someone who has not used your online business’ products or services to submit a review. They will not be able to honestly review your product or services; and
- edit or remove reviews.
ACCC Case Study: Meriton
Businesses must not mislead or deceive consumers through the use of online reviews. This is what happened in a 2017 case between the ACCC and Meriton, a popular property developer. In this case, Meriton tampered with the online review process to minimise negative reviews about their serviced apartments and hotels. Meriton used TripAdvisor’s ‘Review Express’ service, where Meriton would provide guests’ email addresses to TripAdvisor, who would then contact guests to request a review. Meriton misled consumers in two ways by:
- adding additional letters to email addresses of users who had a negative experience, in particular, users who had already complained. As a result, those users did not receive the emails sent by TripAdvisor; and
- removing the email addresses of users who stayed during a disruption such as a power outage or construction work.
As a result, users who were likely to leave a negative review were never contacted and never asked to leave a review. Meriton was fined $3 million for this conduct.
Managing Marketplace Online Reviews
If your online business is a marketplace (e.g. Airbnb, Airtasker and Uber), you may allow users to review service providers, and vice versa, through your website. These sorts of reviews are not regulated by the ACL because they are not about the online marketplace itself but about the service providers. However, it is still helpful to consider how online marketplaces should moderate reviews, and identify fake reviews. Potential users want to be able to assess their potential service provider before engaging them.
There are a few things you can look out for to identify fake reviews. You may notice:
- an increase in the number of reviews for one particular provider;
- repetitive phrasing in multiple reviews;
- multiple reviews from the same name or email address; or
- reviews that recommend going to another service provider.
If you know a review is fake you should take action to remove the review, either by reporting the review to the review service provider or, if you are able to, removing it yourself. It is also a good idea to allow users to flag reviews that they find suspect or inappropriate so that fake reviews can be more easily identified and removed.
Online reviews are an important tool for online business owners. They are a means of informing future users of the quality of service they can expect. They may also help potential customers or users choose which supplier or service provider they want. Online reviews should not mislead or deceive users about your online business. This means that they should not be false, inaccurate, or biased. Failure to ensure the honesty of reviews may result in a breach of consumer protection laws and may result in a fine or other regulatory action from the ACCC. If you have questions about your business’ online reviews, get in touch with LegalVision’s online lawyers on 1300 544 755 or fill out the form on this page.
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