Skin care brand Sunday Riley wrote fake Sephora reviews…

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We have all worried about it. I love reviews for helping me make buying decisions. It is great to have information from real customers who have experience with a product. But are those reviews real? We have written about it before right here in Teach the 4 Ps. We also have an Ethical Dilemma on fake reviews in Essentials of Marketing.

It came up again recently when it was reported that “Skin care brand Sunday Riley wrote fake Sephora reviews for almost two years, FTC says.” (CNN, October 23, 2019. As consumers increasingly rely on reviews as a source of buying information, there is a growing incentive for sellers to add more information. This story about Sunday Riley is particularly egregious.

This is a major concern for retailers or other intermediaries that add value by providing reviews. For Amazon, good and bad reviews provide valuable information to consumers — but fake reviews threaten trust in the system. Consider, a study by a British consumer education group which found “Many popular tech products on Amazon are boosted by fake reviews, an investigation finds,” (CNN, April 16, 2019). Even travel site like TripAdvisor faces the same concerns, “TripAdvisor defends itself against claim that up to one in seven reviews might be fake,” (CNN, September 6, 2019). For Amazon and TripAdvisor their business models rely heavily on reviews. These intermediaries do not pay customers to provide this information — so it is low-cost to add — but it is one of the main reasons many customers use the sites. Consequently, Amazon and TripAdvisor use artificial intelligence technology to try to weed out fake reviews.

We cover online reviews and related ethical and legal issues in Chapters 13 and 16 in Essentials of Marketing. 

Mattress firms creating value (?) with financing deals…

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The mattress industry is a pretty crazy (check out “The Great Mattress Conspiracy: Why Are There So Many Mattress Stores?” on Endless Thread, podcast and story). You might check out the podcast for a fun example when you cover retailing. Or ethics. You might also check out one of our previous posts, “The Gray World of Online Reviews” (Teach the 4 Ps) — tags include ethics and online reviews.

Onto our story of the day and we are back in the retail mattress industry. With the emergence of new mattress products designed for easy shipping, online mattress stores (Casper, Leesa, Tuft & Needle), this market continues to be very competitive. Retail brick-and-mortar store Mattress Firm has closed 700 stores and is in Chapter 11 bankruptcy. Now they are competing on financing. In fact, Mattress Firm will give you six years of 0% interest on a mattress purchase of up to $3999. Financing is certainly one way to create value for customers — and the automobile industry has done it for years — but does it make sense for buyers of mattresses. We will see. Learn more reading “6-year, 0% loan for a mattress? Intense competition continues to grip mattress industry,” USA Today, October 25, 2019.

He Knows if You’ve Been Naughty or Nice

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Welcome back, I hope everyone had a restful and relaxing holiday with friends and family!  When I saw this Marketoonist cartoon I thought it was very topical for the start of a new semester.  Marketing should be all about informing and enabling consumers but there’s always the risk (and temptation) to push ethical boundaries.  As we welcome a new batch of students, talk with them about where those boundaries lie.  Is it intrusive if consumers give permission to track information?  What if they didn’t opt-in but instead you utilize an opt-out strategy?  Are we doing a disservice to customers if we don’t utilize available tools and technology to optimize our messages?

IHOP Publicity Stunt

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Over the summer one of the most talked about marketing campaigns was the IHOb campaign.  The International House of Pancakes announced they were changing from IHOP to IHOb and later announced that the “b” stood for “burgers”.  Shortly afterward they admitted it was all a publicity stunt to help build awareness of their line of burgers.  This campaign has potential for a couple of class discussions.  First, was it successful?  Clearly they succeeded in getting people talking about their company but whether it drove sales is more ambiguous.  This article from the USA Today suggests it did not drive a material increase in sales.  Another article from geomarketing.com indicates that there was an increase in male traffic but the net result was negative due to lower traffic by females.

Another angle to discuss is the ethicality of the campaign.  Is it ethical for a company to say “we’re changing our name” when they have no intention to do so?  Does this create a bad precedent or does it cause other companies to push the boundaries of deceptive marketing?  How far is too far when trying to gain publicity?

Popularity is For Sale

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The measure of your impact in social media is often the number of followers or views that you have.  The theory being that better, more interesting, or more popular individuals and content will naturally draw a larger follower base than those of lesser interest.  However, it seems that everywhere you turn there are individuals willing to venture into ethical grey areas to get ahead.  The New York Times wrote this lengthy but fascinating article titled The Follower Factory.

The article covers a number of topics including social identity theft and the practice of buying Likes, followers, YouTube views, and more.  The article states that nearly 15% of Twitter’s reported active users are actually automated accounts designed to simulate real people.  Facebook disclosed that they have up to 60 million automated accounts.  The range of people buying these fake accounts is staggering.  Professional athletes, politicians, entertainers, TED speakers, and church pastors are just a small sampling of the customers knowingly buying fake followers to boost their social media status.  These accounts are also used to support overseas governments, promote products and services, and promote pornography.  Some of these accounts are auto-generated but many of them are duplicates of actual people making it look like those individuals are the ones promoting those views, products, or services.

The article also discusses the incentives many companies put in place that unintentionally encourage people to participate in this activity.  Overall it is a very interesting article and could lead to a rich class discussion.