The “worst of the worst”: when online retail goes bad

Online shopping seemed like the answer to our prayers over the last two years, acting as a lifeline to many during the various lockdowns and pandemic-related restrictions. But as ecommerce reach has grown, so too have underhand tactics such as fake reviews and sham sales, designed to keep consumers spending and profits high.

Shoppers of all demographics have become more comfortable with ecommerce as the pandemic accelerated the shift towards a more digital world. Last year, over-65s accounted for 30% of online sales, a significant leap from 20% in 2019 – and it’s not a huge reach to say that this audience is less likely to be aware of dodgy discounts and price manipulation, leaving them vulnerable to dubious digital marketing tactics.

Of course, online shopping can be a minefield for any consumer, regardless of age – as anyone who has scrolled through a Buzzfeed list of ‘online ordering fails’ can attest. Online reviews are supposed to reassure customers – but can they really trust them?

Bogus product reviews are an “epidemic”, according to Saoud Khalifah, founder and CEO of Fakespot, a site that ferrets out fake reviews. “Companies constantly plant positive reviews of their own products and sully competitors’ products with negative reviews,” he said, alleging that at one point up to 70% of the reviews on Amazon were not real.

Described as a “historic and dramatic shift in consumer behaviour” in PwC’s latest research, the rapid changes in online shopping behaviours over the past two years have given the industry a significant boost. Total ecommerce sales in the UK alone are now worth upwards of £693 billion, accounting for  more than 26% of all retail sales made – a figure which is likely to continue to grow.

Despite this, many consumers remain wary of ecommerce, believing the online retail industry to be rife with deceptive and underhand practices, from dodgy adverts to paid-for reviews and everything in-between.

Of course, Charged couldn’t possibly comment – but in the interests of research, here are some of the biggest consumer-facing scandals in online retail from the last 12 months.

Fashion Nova: rotten reviews

The fast-fashion retailer was accused of hiding reviews of less than four stars on its website by the US Federal Trade Commission (FTC), as part of a wider crackdown on the practice.

The FTC claimed that Fashion Nova used third-party online product review software to only post four or five star reviews to its website. In doing so, the regulatory body said Fashion Nova had “misrepresented that the product reviews on its website reflected the views of all purchasers who submitted reviews.”

Fashion Nova denied the allegations, saying they were “inaccurate and deceptive.”

The company told Business Insider that it “never suppressed any website reviews” and immediately addressed the issues when it became aware of them.

Fashion Nova was held accountable for the missing reviews and ordered to pay $4.2 million. Despite that, the fast-fashion retailer claimed to remain “highly confident that  [it] would have won in court and only agreed to settle the case to avoid the distraction and legal fees that [it] would incur in litigation.”

Amazon: fake five-star fans

Amazon was probed by the UK’s Competition and Markets Authority (CMA) last year, as the watchdog delved into the number of fake reviews on the online marketplace.

The CMA claimed that the ecommerce giant was not doing enough to detect and remove fake product reviews, opening an investigation to see if it had “broken consumer law by taking insufficient action to protect shoppers from fake reviews”.

The consumer protection agency also looked into whether sellers were manipulating product listings by taking positive reviews from other product pages and using them as their own.

“Our worry is that millions of online shoppers could be misled by reading fake reviews and then spending their money based on those recommendations,” stated CMA chief executive Andrea Coscelli. “Equally, it’s simply not fair if some businesses can fake five-star reviews to give their products or services the most prominence, while law-abiding businesses lose out.”

At the time, Amazon responded: “To help earn the trust of customers, we devote significant resources to preventing fake or incentivized reviews from appearing in our store… We work hard to ensure that reviews accurately reflect the experience that customers have had with a product.”

The case remains open, but if the CMA believes Amazon has broken consumer protection law, it can take legally-binding action to force the company to change the way it deals with fake reviews.

Boohoo: sham sales

Despite its best efforts, Boohoo’s reputation has come under threat a number of times over the past year, with an ongoing supply chain controversy including illegally low pay, hidden exploitation, fraud and audit evasion.

Focus on Boohoo’s consumer-facing issues though, and there’s one that stands head and shoulders above the rest.

A lawsuit, filed in California last year, accused the fashion retailer and a number of its brands (including Pretty Little Thing and NastyGal) of offering sales and discounts based on entirely false original prices, designed to dupe customers “into a false belief that the sale price is a deeply discounted bargain”.

Co-founder and executive chair Mahmud Kamani was later called upon to testify under oath, after damning emails in which he told staff to put massive offers on screen” were used as evidence of the “false pricing tactics” in court.

In November, Boohoo revealed it was close to reaching a preliminary settlement agreement over the class action lawsuit, although the amount remains undisclosed. If the claim had been successfully filed in court, Boohoo could have faced total damages of over $100 million.

Shein: manipulative marketing

Back in October, Shein was named and shamed as being the “most manipulative” fashion website, according to research by Rouge Media.

Now the world’s largest online-only fashion company,  Shein – dubbed “the worst of the worst” by The Guardian – features various ‘dark patterns’ on its website. These are elements which have been built into the website to trick users into spending more, such as time-limited countdowns, exclusive discounts, trending stickers and prompts to spend more for a free gift or delivery.

Employing these tactics is by no means unusual in the world of fast-fashion, but Shein has been branded the worst offender, with shoppers navigating eight different instances of dark patterns by the time they reach the the checkout.

“It’s been really interesting to dive deep into the world of fast fashion to uncover how clever marketing and design techniques are being used to suck consumers into a never-ending loop of buy, wear, throw,” Rouge Media design director Andy Woods said.

“Dark patterns are nothing new, but the sheer scale at which they’re now being used in online retail raises questions over the impact on young people who often rely on post-purchase payment services like Klarna to fund their shopping habits.

“While dark patterns certainly have their place in e-commerce web design, perhaps it’s time for the industry to take a step back and review their use.”

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