Small Businesses Say Fake Reviews Are Running Rampant — Is This True, and What’s the Solution?

A recent report issued by LocalImpact — with survey results being derived by polling 400 U.S. small business owners — suggests that there’s a serious problem concerning fake reviews targeting local establishments.

“If you run a local business, fake reviews are now part of the job. 72% of the owners we surveyed say they’ve received at least one fake review in the past 12 months, and only 8% are confident they’ve received zero,” Boris Mustapic wrote in describing the survey results.

“The volume isn’t trivial either. A quarter of owners report receiving six or more fake reviews in the past year, with 7% saying they’ve received more than ten,” he added.

Other top-line takeaways presented by the polling results:

• Nearly four-fifths (79%) of business owners polled stated that their business was the subject of a targeted fake review attack.
• Suspicion runs deep in the other direction as well, with 70% of respondents believing that their competitors were leveraging positive false reviews to enhance their own reputations.
• It appears difficult to get alleged fake reviews scrubbed, with only 28% of independent business owners reporting success in this arena.
• Less than one-third (31%) of businesses are adequately prepared to respond with a dedicated review management platform.

Fake reviews appear most prevalent on Google (~68%), Facebook (~53%), and Yelp (~52%), with Trustpilot (~20%), Tripadvisor (~19%) pulling up the rear.

What exactly constitutes a fake review boils down to detection signals, with factual inaccuracy (~60%) being the No. 1 indicator of a false review in the eyes of independent business owners. That means reviews which include details which are way off base versus the actual business operations, inclusion of amenities not offered by the business, a non-existent location, or workers who don’t actually work there. Verifying that the complainant was never actually a customer, no prior review history on the account, a glut of similar reviews hitting at the same time, or platform flagging/auto-removal are other signs of false reviews.

“Despite the scale of the problem, most local businesses are still managing it with limited tools. Only 31% use a dedicated review management platform. When asked how well-equipped they’d feel handling a sudden spike in fake negative reviews, only 36% said ‘very well-equipped.’ 17% admitted they aren’t well-equipped or aren’t equipped at all,” Mustapic wrote, highlighting that this exposed a significant deficit in current small business capabilities.

And when it comes to damage, the real elephant in the room, the responses showed a similar pattern of anxiety or worry:

• On the marketing side: More than half (52%) of businesses stated they took damage to their star rating as a result of fake reviews, while 33% pointed to lost potential customers — and more than a quarter (28%) suggested they’d lost revenue.
• Time wastage: With 40% of owners reporting that they’ve essentially wasted time and effort in managing / responding to fake reviews, that’s an operational drawback that’s hard to ignore. A further 17% admitted they’d engaged with legal professionals over fake reviews, and 27% have outsourced the problem to third-party agencies — another expense.
• Staffing issues: About a quarter (24%) of independent business owners said that fake reviews had resulted in stress among their staff members, alongside morale issues tied to the same. Approximately 20% of owners further stated that these false reviews had led to difficulty in attracting new applicants.

“Fake reviews used to be an occasional annoyance. Based on the latest data, they’ve graduated into a category of operational risk that local businesses now have to manage actively, the same way you’d manage payroll fraud, inventory shrinkage, or any other recurring cost of doing business,” Mustapic concluded of the report’s findings.