Saijo George

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friday20 Aug 2021

Amazon Cracks Down on Fake Reviews, Hitting Chinese Retailers

https://www.bloomberg.com

To get attention on Amazon’s sprawling marketplace, many Chinese sellers offer freebies or even cash to consumers willing to write favourable product reviews. Amazon once allowed such incentives in exchange for reviews to help introduce products to customers. But it began discouraging the practice in 2016, realizing freebies compromised the integrity of customer reviews. Many merchants ignored the new rules by recruiting shoppers on Facebook and reimbursing them via PayPal to elude Amazon’s detection, and the problem persisted.

Amazon is cracking down on pay-for-praise schemes, which can include other forms of consideration for reviews including free extended warranties, discounts or refunds, or gift cards, as the company looks to restore a sense of order to its previously free-wheeling marketplace. Starting in the second quarter, Chinese industry observers say, the company abruptly changed course and began suspending retailers and freezing their inventory at its U.S. warehouses. More than 50,000 Chinese retail accounts have lost their place on the platform, resulting in lost sales of 100 billion yuan ($15.4 billion), according to the Shenzhen Cross-Border E-Commerce Association.

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