Angie's List: Beware phony reviews

Perhaps you've used an online review to see what others are saying about a product or service before you decided to spend the money. Not a bad idea, but is what you read fact or fiction?

Angie Hicks, founder of the consumer group Angie’s List , said online reviews are a popular place to turn for pre-purchase information. "But the important thing for consumers is," she said, "is the information reliable? Are they getting good information to make sure they are spending their dollars wisely?”

Unfortunately, that is not always the case, Hicks said. "Consumers turn to the Internet as a replacement for networking with friends and family. The information online needs to be reliable. It needs to be good information by real consumers so it can make doing that research even easier. ”

Angie’s List has been compiling consumer reviews since 1995 and invests significant resources in an accountability process that it hopes other online outlets will follow. At the top of that list is the prohibition of anonymous reporting.

“I’m completely against anonymous reviews," said Hicks, "because that leads to information not being reliable. Consumers are making too big of decisions based on information they read online and we need for people to be accountable for what’s being said. ”

Earlier this year, the Federal Trade Commission announced plans to develop guidelines in an attempt to crack down on fake consumer reviews. In March, a Dallas-based Internet marketing and online reputation management firm, Dalfort Media, confirmed what the New York Times, the FTC and state regulators already believe: fake positive reviews on consumer review sites are rampant. Based on ten "red-flag" factors, the Dalfort Media study found that 57% of the reviews for a sampling of businesses in the Google Places directory appeared to be fabricated.

This practice is illegal and can cost a guilty business hundreds of thousands of dollars in fines and millions in lost sales resulting from bad publicity. One company last year had to pay $250,000 in fines after the FTC discovered its staff was posting positive reports about its products as a way to encourage sales. The FTC already has adopted guidelines companies are to follow when it comes to blogging and bloggers are supposed to disclose when they’re reviewing a product they’ve been given by the company.

Hicks adds, “When consumers turn online to get information on services they might want to hire the first thing they want to do is understand how the site works. How are the reviews compiled? How do companies get listed on the site? These are all important questions for consumers. ”

Angie’s List Tips: How to get the most value from online review sites

Research the sites to determine how they work:

• Are reviews anonymous?
• Are reviews edited by the site or allowed to stand as the reviewer wrote them?
• Does the site have a check and balance system to ensure the reviews are truthful and fair?
• Does a human being read the reviews?
• Can companies respond to the reviews?
• Are there remedies for consumers who have issues with companies they’ve reviewed?
• Can you reach someone at the site if you have questions?

Review the reviewers:

• Look for companies that have multiple reviews, especially on anonymous review sites, so you get a wide opinion base.
• Do many of the reports seem very much alike, as if they may have been form letters submitted by someone trying to stack the deck?
• Are all the reviews overwhelmingly positive that they sound too good to be true?
• Do the reviews contain details that help convince you they came from real people?
• Is there information beyond stars, checkmarks or grades so you can learn more about what led to the online review?

Cast a wide net:

• Don’t rely on just one resource, especially for high dollar major projects.
• Check a variety of online sites and regulatory sites, like your state attorney general, to get a wide opinion base.
• Check with friends, family and neighbors.
• Trust your instincts.

“Remember online reviews are only part of your research," Hicks said. "You still need to get three estimates, interview the company in person, and I always remind people – don’t ignore your gut instincts.