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As an economics grad, I always wondered why online reviews existed at all. There's no skin in the game for anyone. If your neighbor recommends you a crap lawnm
by lordnacho 6y ago
As an economics grad, I always wondered why online reviews existed at all. There's no skin in the game for anyone.
If your neighbor recommends you a crap lawnmower, he'll have to explain to you why he thought it was good. You can ask him questions and compare his motivations to yours. He'll also end up living next to a badly mowed lawn if he doesn't put some work into it.
The seller has every reason to pay people to write good reviews. He doesn't even need real people, it's the internet and you can invent people, complete with their own unique photos and profiles.
Basically, honesty is expensive and cheating is cheap. Why would we trust it?
My personal experience with Amazon is that it's the shop to go to for stuff that is ok if it is broken. If I buy a cable for £10, and there's a 10% chance it's faulty, it's not a huge problem for me. The other use case is where the guarantee comes from the brand. I'm not sure why but I tend to think if I buy an iPhone on Amazon, it will be the genuine thing from Apple, and I have history with Apple apart from Amazon reviews.
- gwd 6y ago> My personal experience with Amazon is that it's the shop to go to for stuff that is ok if it is broken. If I buy a cable for £10, and there's a 10% chance it's faulty, it's not a huge problem for me. I'm rather surprised at that, from someone who claims to be an economic grad. First of all, you must realize that that 10% isn't stable: the "Market for Lemons" effect will guarantee that if nothing is done to stop it, that 10% will become 90%. Secondly, you're not factoring in either your time or the opportunity cost of having to buy your second cable. If you order your cable and it arrives the next day but broken, you spend at least an hour figuring out that it's broken, and then have to order another one, and then wait at least another day for it to come.
- lordnacho 6y agoBut a cable is such a simple item to find out if it's broken, it takes 5 seconds, plus I can just buy two and be 99% sure I have one that works. Akerlöf doesn't seem to apply here, there's no hidden information that comes out later. With a car there's all sorts of dimensions to it that might annoy you. Perhaps the idea is that all cables will go to crap eventually, but my detection cost is also fairly low on that. Additionally, and this is probably not a great dynamic, I can go to the website of a box-store, which will carry some of the same brands, presumeably vetted more than the junk shop.
- PicassoCTs 6y agoIts even cheaper to just send it to known problem detectors, and outsource the work of flaw detection to the customer.
- gwd 6y ago> Akerlöf doesn't seem to apply here, there's no hidden information that comes out later. The hidden information is how much quality control has gone into the manufacturing process. Seller A and seller B are both selling a cable for $10. Seller A bought thier cables for $8 because they spent a lot of time honing their manufacturing process and weeding out bad cables; the chance of getting a bad cable from them is 0.1%. Seller B bought their cables for $2, because they just went for the absolute cheapest option they could. The chance of getting a bad cable from them is basically 75%. You as someone buying it from Amazon can't tell the difference; so sellers like B make loads more money. Unscrupulous people hear about this and many more sellers like B show up. Sellers like A get frustrated and leave.
- ballenf 6y agoSeller B got their hands on the rejected cables from seller A. They were in fact paid to scrap them and instead are selling them after putting a sticker over a label.
- vidarh 6y ago> there's no hidden information that comes out later Sure there is: How well a cable handles being bent, and whether or not it catches fire... Cables and especially chargers are some of the products I'm most cautious about buying from sellers I'm not confident about exactly for that reason. (not that origin is sufficient - the one charger I have had that got closest to setting the house on fire was a genuine Apple charger [many many years ago, they had a design flaw with a too-short sleeve on the cable on the early Macbook chargers; it'd bend and short and melt])
- xxs 6y ago>But a cable is such a simple item to find out if it's broken, it takes 5 seconds This is so incredible false, cable quality varies greatly: - wires, gauge and material. Copper is expensive and some cheat using aluminum or Al plated copper. Gold plated terminals, tinned copper, etc. - wire material and single/multi strand determines resistance and current rating, along with loses in the cable. - insulation and sleeves can be made from different materials with a lot of properties, incl. max temperature, flame retardant and so on: pvc - cheap, rubber - expensive, nylon/polyamid - expensive, silicon - very expensive. And that just touches the basics...
- jp555 6y ago"First of all, you must realize that that 10% isn't stable: the "Market for Lemons" effect will guarantee that if nothing is done to stop it, that 10% will become 90%." Are you sure? Is this ergodic? Does the ensemble average predict the time-series average?
- fmajid 6y agoAmazon has a huge counterfeit goods problem, and buying from Amazon itself as opposed to a third-party merchant on the Amazon platform is no guarantee, because of their "commingled stickerless inventory" program. Apple accessories in particular are heavily counterfeited, I'd bought some USB-Ethernet adapters for a meeting room with too much WiFi interference. They seemed to work fine then I got a new Mac and it refused to recognize the adapters, and they appeared with weird Chinese characters in System Profiler. On careful inspection, they turned out to be fakes, but highly convincing ones. Amazon refunded me, but the distinct impression I got was they don't care as long as they get the money from a sale, and refunds for the few customers who do complain are just a cost of doing business. https://blog.majid.info/amazon-counterfeits/ https://blog.majid.info/amazon-counterfeits/
- throwanem 6y agoI'll buy an iPhone off Ebay before I'll go to Amazon for one, at this point - in fact I've done both. The ones I've gotten from Ebay were represented as new in box, and were in fact new in box. The one I got from Amazon was represented as refurbished, and wasn't - it showed up with a badly degraded battery and a chipped display, both of which I had to replace on my own dime. From the way it looked and was packaged when I got it, I feel lucky not to have found it stolen. Outside the realm of phones, I've also been burned on camera equipment. I ordered a Nikon 200-500mm telephoto lens a few years back, which was represented as sold by Nikon. It proved not to be - by its serial number, it was actually a gray-market item intended for the Chinese market. That wouldn't happen with a sale direct from the manufacturer, and it also totally invalidates the otherwise very good manufacturer's warranty. It's a great copy of the lens and of new enough manufacture to have got past the teething problems, so I kept it. But that was the last time I bought something that pricey on Amazon, too. Nikon's policies are what they are, and have been that way for longer than I've been alive. They're not what I have a problem with here. Amazon is, and at this point I'd only even consider doing business with them on similar terms to what you describe - small-ticket stuff that I don't really care if it's not what the seller claims it is. But then, on the other hand, that leaves Amazon with no point for me at all. In the months since I placed my last order there, I've found small business e-commerce to be alive and thriving, and you know what? It turns out that when you place an order with Spice Place or Betty Mills or B&H or Adorama or whoever, yeah it takes a little longer to show up, but also what's in the box will reliably be what you bought! Wild, right? Even books, now, I get from Indiebound, or Ebay for obscure out-of-print stuff that's hard to find from regular booksellers. And for the basic staples of living, there are plain old regular stores. You can just walk into buildings and buy food and tools and things! You don't have to wait for anyone. At this point, I'm about two-thirds seriously convinced that the whole Prime experience with next-day delivery is as harmful to the customer as it is to the drivers and to the neighborhoods increasingly choked with navy-blue panel vans. I know it exerted an unhealthy hold over my thinking for a lot longer than I'd have preferred in retrospect. It remains wild to me that Amazon found a way to make small-business ecommerce and brick-and-mortar retail look more appealing than itself, but they've certainly done a solid job of it, and I hope they keep it up.
- christophilus 6y ago
- tim333 6y ago>... honesty is expensive and cheating is cheap. Why would we trust it? Most people are well meaning and as long as the site isn't flooded with fakes it can work ok.
- deleted 6y ago[deleted]
- Catsandkites 6y agoAre they really though? I know a lot of some people, who would consider themselves "well meaning" (fair, honest, just, whatever) and they totally do this all the time. When you combine the actually bad people with those people, isn't 30-40% of the population constantly fucking with the system? See also: Democracy. App store reviews. The soundscape. Climate change. Etc.
- smichel17 6y agoI think it only becomes a problem when the system gets big enough. If there's 20 different online storefronts, it's a lot more time and effort to game the reviews on all of them, than if there's only Amazon.
- tim333 6y agoI'd guess about 99% are basically ok with reviews. The trouble is if only 5% of those bother reviewing and 1% of the bad ones post a bunch of fakes. Incidentally I use argos.co.uk a bit and have found the reviews there always ok so far. Maybe Argos polices it or that crowd doesn't bother faking? It's different from Amazon in that there are no independent sellers so the only people motivated to fake would be the manufacturers.
- beowulfey 6y agoAs you say, that breaks down the second anyone decides to use fakes.
- weinzierl 6y agoThat there is no skin in the game for anyone is not a fault of online reviews per se in my opinion. Brands were invented to enable a trust relationship between manufacturer and consumer. Brands are an anchor of trust. There is no such anchor for sellers. As you wrote, your neighbor won't recommend you a bad lawnmower because they have an interest in a continued good relationship. If your neighbor is secretly exchanged for a almost, but not quite identical one, willy-nilly and all the time you would not be able to build a trusting relationship in real life too. But that is exactly what happens on Amazon. What good are seller reviews if sellers change and disappear all the time. What good are they if I can't click "Buy again" and then rely on buying not only the same product but also from the same seller I already trust? I wish seller brands were as prominent as manufacturer brands but I can understand why neither Amazon nor traditional brand have an interest in such a system.
- criley2 6y agoI would suggest that in lieu of individual seller brands on Amazon we do have one seller brand: Amazon We all know that Amazon has counterfeit goods and only cares the minimum. We all know that Amazon has fake reviews and only cares the minimum. We all know that Amazon "marketplace" is over-priced imports from AliExpress (if we're lucky!) or perhaps is refurbished goods, fake goods, or just scams. The brand that sucks is Amazon. The seller that is ripping us off is Amazon. This can't go on forever. They really are killing their brand. 10 years ago, Amazon had the reputation of a king. They were revolutionizing delivery and could do no wrong. Today... you ask a group of people their opinion on Amazon and we're already up to half negative on average, at least where I am. They are literally killing their own brand by doing this.
- Symbiote 6y ago> I tend to think if I buy an iPhone on Amazon, it will be the genuine thing from Apple Maybe, but in the UK I'd choose ten other suppliers before giving a penny of profit to a company like Amazon. Tesco, Argos, the Apple store, Currys, any phone network, Carphone Warehouse, John Lewis... Several of these have next-day delivery, same-day collection, or even the old fashioned walk-into-shop-and-pay thing.
- luckman212 6y agoDoes doing that "walk into shop and pay" thing mean you also have to do that old "talk face to face with another human being" thing? Good lord, what would you have us do next? Go to market to buy some fresh meat & veg and prepare an actual home cooked meal?? /s
- Symbiote 6y agoNot at Argos, the original catalogue shop. They used to have large paper catalogues to browse (or take home), but now I think it's computers. You can order and pay using a terminal in the shop, from a phone app, or by asking the assistant. You get a paper receipt with a big number (presumably something similar on the app, which I haven't used) and wait at the back. After 2-3 minutes, your order number appears on a screen at the back of the shop. You show the receipt to collect it. The image in the article shows most of it. Behind the photographer is usually a display of a few things: toys, bicycles, watches etc. https://internetretailing.net/mobile-theme/mobile-theme/argos-launches-ai-powered-visual-search-to-connect-physical-catalogues-with-online-channels-19245 https://internetretailing.net/mobile-theme/mobile-theme/argo...
- dash2 6y agoThere are other motivations than self-interest. People may altruistically care about other consumers' welfare. They may be reciprocal, taking revenge for a bad product by writing a bad review, and rewarding a good one. Or they may just like to express their opinions!
- xxs 6y ago>skin in the game I do write/have written reviews, incl. tear down pictures for some products as I'd be happy if I find similar approach/reviews. Normally I read only 3 and 4 star reviews, or the ones that have disassembly pictures and seem to have been written by coherent people. It's a slow process, unfortunately but it does help with selection. EU (and the UK) have 2y of mandatory warranty and 2weeks free returns, so the fake reviews are not so prominent.
- vidarh 6y agoI leave reviews for two reasons: To reward a seller when I really like something, and to punish a seller when I really hate something. Rarely in between. Well written reviews are a common good, and there is good reason to believe that leaving reviews encourages others to do the same, and that helps me, so I do it. Yes, I know there'll be fake reviews, but most of the time they are pretty easy to spot. Not least because the reviews that swing things for me -- both towards buying and away from it -- are the negative reviews. Most of the obvious fake ones are good reviews, but I'm usually more concerned about what the worst thing someone has to say about a product. If someone posts about a printer that it doesn't work with Linux, I won't buy it (at least not without double-checking and verifying that said reviewers info is outdated) no matter how many positive reviews there are. Meanwhile, if I can't find any negative reviews complaining about things I care about it will often convince me to buy. That is a lot harder to game than getting a bunch of people to write that they love the product.
- nkrisc 6y agoYou make good points, but on Amazon I just have to assume that all the reviews are fake. I've seen how easy it is to buy fake reviews, the lengths sellers go to get people to leave only 5-star reviews, and Amazon's inability or unwillingness to do anything about it. Why do you think any of the reviews on Amazon are real? I think any random review you pull up is more likely than not to be fake. Of course, we can't know for sure, but Amazon has simply lost my trust. I no longer believe any of the reviews on Amazon are real, and Amazon will have to prove to me they are before I ever trust a review on that site.
- vidarh 6y agoI think many of the reviews on Amazon are real because a lot of them are negative reviews warning people not to buy the product, and those are generally the ones I look at. That's harder to game, because while a seller certainly could post a negative review citing some irrelevant flaw (and I have seen that), and hope that triggers buyers who don't care, they won't stop other people (like me) from posting negative reviews too, and what I'm looking for is products with a reasonable number of negative reviews where there is an absence of reviews mentioning things I care about. I also know first hand from selling a novel on Amazon that you can perfectly well gain honest reviews in ways allowed by Amazon, and I also leave a reasonable number of reviews on Amazon myself, so I have every reason to expect at least a portion of the reviews to be honest. Overall I've managed to avoid buying anything that appears to have been fake from Amazon, despite having bought a couple of thousand products at Amazon over the years (based on the order page stats, and taking off a few hundred as an estimate of digital only products)
- quietbritishjim 6y ago> As an economics grad This perhaps explains the rest of your comment :-) Often in economic theory it's assumed that people are totally rational, and often rationality is assumed to include sociopathic levels of self interest. Daniel Kahneman, the author of Thinking Fast and Slow, uses the word "econ" to describe the mythical creature that statisfies these properties. He makes the point that most people are not econs to some lesser or greater extent (either because they don't fully act in their own self interest or otherwise don't act fully "rationally" in the economic theory sense). I often leave online reviews because I feel it's the right thing to do, even if I personally don't benefit from them. In part, I feel like they're payment for reviews others have left which I've used, even though an econ wouldn't bother because those other reviews would exist regardless of my "payment". I do get your point towards the end of your comment that it's easy enough to come up with fake reviews, either by paying some econ-ish people or just using a machine. I'm talking more about the earlier point about recommendation from your neighbour only being reliable because of the consequences of a poor review.
- parasubvert 6y agoA massive portion of Amazon’s value in the early years were product reviews. To this day they are proud of pioneering this aspect of e-commerce. I remember using Amazon reviews in the 90s and 2000s even to weigh what I bought at bricks and mortar stores. It’s the same reason that sites like Yelp exist. Perhaps most of the reason they were honest early on was Amazon’s product selection early on was only books and media, and secondly there was a community where you could look at other people’s review history to determine if they were a shill and report it. That “community helpfulness” was common in early online communities. I’d say the majority of reviews were real through the mid-aughts. It was only after the Amazon marketplace became indistinguishable from the main site that the scale of sellers flipped the incentive structure towards cheating.
- zbuf 6y agoThese days, if I want an honest appraisal of a product then I prefix the search with "reddit" not "review".
- AtlasBarfed 6y agoAhhhhh, economics is the study of maximizing socially acceptable sociopathy. "It is economically infeasible for people to be helpful!" - the last human on earth, probably. You'll do well. Keep the blinders on, read your Ayn Rand, don't think about things too much. Greed is good.
- ouid 6y agoYou mean advertising? Negative reviews are the only actual reviews.
- davesque 6y agoHonestly it didn't used to matter as much because the number of honest people leaving legit reviews outnumbered the influence of actors exploiting the system. But that was a while ago. But I swear at one point the fact that no one had skin in the game wasn't significant. People seemed to understand what they were for and used them accordingly. And the vultures hadn't discovered them yet.
- samlevine 6y ago> Basically, honesty is expensive and cheating is cheap. Why would we trust it? We shouldn't. And indeed, if you look at a random legitimate review of something it's unlikely to be particularly helpful. More users does not make the data better beyond maybe "was it dead on arrival?". Platforms should empower users to build rings of trust with users they do trust, while keeping it as private as they're comfortable being. People will build social capital because it's useful, it's fun and for the top 0.01% of users is something that can be a job.