Pattern Analysis on Amazon Star Rating Featured in New York Times, Buzzfeed
It's no secret that fake reviews plague Amazon (and other ecommerce marketplaces). Pattern's ecommerce experts were recently interviewed by The New York Times and Buzzfeed News on the degree to which star ratings affect sales and why brands are incentivized to create fake reviews to win new customers.
How star ratings affect conversion rates
Our CRO John LeBaron shared a Pattern analysis that found a 1-star increase in average star rating led to a 26% increase in conversion rate and a 40% increase in sessions when controlling for Buy Box price and Reviews. For example, our study found products with 3.0-3.9 stars averaged a conversion rate of 41%, and products with a 4.0-5.0 star rating averaged a conversion rate of 50%. Even a small increase from 3.8 to 3.9 was comparable to a 2.6 % increase in conversion rate and a 4% increase in sessions. When star ratings can so reliably impact sales, it's clear why many sellers turn to black hat tactics to boost their star rating on products.
Black hat tactics
Black hat tactics in ecommerce—at the most basic level—are tactics that either violate outright or work around the existing terms and conditions of an ecommerce site. For example, although Amazon banned free or incentivized reviews way back in 2016, people like Jessica in the Buzzfeed article are still getting free products to leave 5-star reviews on products.
Even a simple search on Upwork reveals a plethora of workers dedicated solely to leaving 5-star reviews or getting rid of negative reviews for brands on Amazon and other marketplaces. Black hat tactics like this are extremely harmful for rule-abiding sellers like Pattern and our brand partners who rely exclusively on true, verified reviews. Our CRO, John LeBaron called the practice "a stain on the whole industry" because of the lasting effects black hat tactics have on sales-driving metrics such as product rank. Learn more about black hat tactics in our article,“Black Hat“ Tactics Are Hurting Your Amazon Sales. Here's How to Fight Back.
How product ranking affects sales volume
Fake reviews are such a problem for sellers because star rating and positive reviews affect other metrics like product ranking, or how well a product appears in a search. And, like it or not, product ranking heavily affects sales. Amazon doesn't disclose how much star rating affects product ranking, but we know it does have an effect.
Although Amazon says it regulates fake reviews, unfortunately, honest brands are often left on their own to compete with an inflated competitor's ranking because of them. For example, another Pattern analysis John shared with Buzzfeed showed how rankings for the term "men's sunglasses" affected sales. On average,
- The top 5 sellers for the term make $60K per month
- The top 10 make $53K
- Products on first page for the term make $42K
“That’s what makes spending money on free products worth it for these black-hat sellers,” LeBaron told Buzzfeed. “The cheapest, easiest way to [make money] is to cheat. Unless Amazon takes an aggressive approach, it’s going to continue to flourish. ... It’s really detrimental to people playing by the rules.”
How to recognize fake reviews
For consumers, fake reviews can be misleading and even dangerous for certain products. Websites like Fakespot.com or ReviewMeta.com can help them differentiate between real and fake reviews on sites like Amazon.