Update: welcome Consumerist readers! While I use my own experience to illustrate concerns about third-party online merchants, this post is mainly about the bigger long-term informational problems I see with reputation, reliability, and online communities. Please feel free to weigh in!
A few weeks ago, I caught a familiar story on the local news. A local citizen had written in to the news team with a request for help after a local furniture company sold them a defective living room set, and wouldn’t give them a refund. The news team went to the business, who – wary of the potential public relations nightmare – apologized and exchanged the purchase. The customer got satisfaction without having to go to small claims court. Score one for traditional media!
It wasn’t a very memorable segment; lots of local newscasts and newspapers do this sort of thing. But it suddenly occurred to me that as traditional local news outlets die and people stop watching the local news, we’re losing a valuable community “shaming” mechanism. Sure, we can use online services like Yelp to express our dissatisfaction with a business, but Yelp won’t intervene for us, and a single Yelp review isn’t that prominent to the community of potential customers at large. The only other future customers who will be dissuaded by a bad Yelp review are those who also use Yelp. Rightly or wrongly, a bad review on Yelp just doesn’t seem as threatening to a merchant as a bad review on the nightly news. Plus, Yelp is in a bit of hot water over recent allegations that they extort advertising in exchange for positive reviews – and whether this is true or not, if Yelp loses credibility with consumers, it will have even less impact on merchants – which means consumers who write reviews have even less power to affect reputation.
Part of the problem here is that online reviews can be written and posted by people who have never used the service or product – for example, Mechanical Turk makes it easy to farm out the chore of writing reviews for a few cents apiece, and thus skew your online reputation. Some feedback systems, like the seller ratings at Amazon and ebay, tether transactions to feedback, so presumably the feedback all comes from interested parties who have actually dealt with the merchant. This should make Amazon Marketplace seller ratings much more reliable than Amazon reviews – in theory.
But in reality, big problems arise when dealing with third-party sellers on platforms like eBay, Half.com, and Amazon Marketplace. Such sellers have little incentive to be responsible. One might suppose that if they rip off a large proportion of their customers, their feedback rating will go down, and deter future buyers. But many potential customers don’t check seller feedback before they click “buy”. Plus, sellers can pressure customers who give bad feedback to withdraw it as the price of remedying the situation, so other potential customers will never hear about the bad interactions. Finally, if something does go wrong for you, although third-party sellers benefit from the big-name reputation associated with their hosts, hosts like Amazon and ebay will rarely take responsibility for third party sellers’ behavior. Even if a host kicks a seller off, it’s a minimal investment of effort and resources for the seller to rejoin under a new identity with a clean reputation the next day – something that brick-and-mortar stores simply can’t do. How can scattered online buyers cooperate to hold these faceless sellers to ethical, fair business practices?
Ironically, shortly after asking this question, I got ripped off by an online merchant, inconvenienced, and ended up about $50 out of pocket. And the experience made me wonder yet again whether/how we can create mechanisms as a online community to deter bad actors.
Here’s the scenario: I bought a new book from Amazon Marketplace seller any_book. I always look at the seller’s feedback; in this case it wasn’t great (about 94% positive), but few sellers had new copies of the book I needed, so I didn’t have much choice. I went ahead and ordered – a terrible call on my part. Here’s what happened.
1. The book wasn’t shipped for several weeks. According to Amazon Marketplace policy, “Sellers are expected to ship all orders within two business days of the date the order notification is made available by Amazon.” But my book wasn’t shipped until two weeks after I ordered it. (any_book refused to admit this, of course; I figured it out by running the tracking number on the package.)
2. The seller refused to respond to emails. After I bought the book, any_book did not communicate with me at all. So I asked for verification that the book had been shipped, with whom, when, and for tracking information. I asked through Amazon, by email, and on their website. They didn’t respond. While their website says “tracking information is available upon request,” they simply refused to provide it, even after I asked twice. When they did finally email me, they gave me an arrival window extending up to six weeks after my order – and no tracking information. Hmmm.
3. The book finally arrived almost a month after I ordered it. Crappy, right? Amazon Marketplace is actually fine with that kind of delay – while they give you an optimistic delivery estimate, you can’t actually file for a refund until a month plus three days after your purchase. So delivering the book a full month after I ordered it was not technically a violation of the purchase agreement. However, it resulted directly from the delay in shipping, which was a violation of the terms of purchase. And of course it caused me significant inconvenience (I ended up having to photocopy what I needed from someone else’s copy of the book, at a cost of $20 and 2 hours of my time).
4. The best part? The book they finally sent was used, not new. Yup – I paid a premium for a “new” book, and instead got one that had been through the wringer – writing and highlighting everywhere. If I’d wanted a used book, I’d have bought one in the first place more cheaply – the price I paid was much higher than the price charged by sellers who didn’t lie about the condition of their books. I ended up with this choice: either find and buy a new copy locally that was marked up $30 over online retail, or order online more cheaply but pay for 2-day delivery. Nice.
So to recap: thanks to any_book, I waited a month in vain, had to borrow someone else’s book and spend $20 on copies, and finally bought the book somewhere else at a $30 markup. Yeah, that’s a great experience! (Then it took another month to get a refund.)
After this experience, I did what I should have done in the first place: I Googled any_book to see if other people had similar problems. They sure had. In fact, I found two stories that sounded much like mine. The very first Google search result for any_book is a complaint at my3cents.com, which says:
I ordered a book April 9 through Amazon.com from a seller known as any_book. They stated my order would ship same day via USPS. When I didn’t receive my book by May 4, I sent an inquiry to the customer service department . . . On May 7, I responded back stating that they should resolve my issue by May 18 or I would post a negative comment on Amazon. They didn’t respond and I didn’t get my book, so on May 19, I posted a negative comment on Amazon. I quickly received a response asking me to remove my negative comment so we could work together. I responded stating that I would remove my comment IF I received another shipment or a refund. They did neither and sent me a message stating “Sorry we couldn’t work together”. I posted several other pleas for a refund and have heard nothing from them. Today, 7/3, I filed a claim with Amazon to receive a refund.
Wow. So this other customer was jerked around for three months? I guess I got off lightly. Here’s another review. Even weirder, here’s an author claiming any_book is offering to sell a book which is not yet published. At that point I went back through a few hundred of any_book’s Amazon ratings, and read the comments. Pretty much all the negative comments said what mine did – that the book took a month or more to arrive, or it never arrived, or it wasn’t what they had purchased. It’s a bizarre pattern of feedback – what incentive would a seller have to systematically delay shipping for several weeks? (More on that later)
So if any_book routinely does this kind of thing – lying about their merchandise, not shipping it on time, etc. – why was their positive feedback on Amazon Marketplace around 94%? Isn’t the “shaming” system of buyer feedback going to flag bad actors, and enable future buyers to avoid them? Well, here’s a possible answer why not: when I posted bad feedback about my purchase on Amazon, any_book immediately emailed me to persuade me to remove it. There was nothing overtly threatening about their message, although it did sound as if their willingness to fix my problem was contingent on me removing the negative feedback. But they didn’t come out and say that. Heck, they even offered to refund my shipping costs if I’d take down my negative comment. Nice, right?
Well. . . I call it self-interested.
Let’s look at the result of that seller behavior over hundreds of transactions. As long as a seller anticipates a certain percentage of angry buyers in advance, and marks up prices accordingly, they can more than cover the cost of reimbursing a few dollars’ shipping to customers who post negative feedback. It’s just part of doing business (badly). Those customers take their negative feedback down, and it’s as if the problem never happened. Future customers won’t see that there ever was a dispute associated with that transaction. How many disgruntled buyers do you suppose will rescind their negative feedback in exchange for $5? Half of them? More?
Disgruntled buyers won’t make the same mistake twice and go back to a bad seller. They personally don’t benefit from leaving negative feedback on the seller. Online buyers aren’t part of a small local community, so the odds are pretty low that their friends and family will buy from the same seller later, and most people aren’t especially motivated to help perfect strangers. So only those buyers willing to pay $5 to punish any_book for their unpleasant experience are going to leave negative feedback up on Amazon’s feedback system. I bet that’s a minority of buyers. If at least half of any_book’s disgruntled buyers can’t be bought, then their overall buyer dissatisfaction rate is really 12%, not 6%. If only a quarter of disgruntled buyers hold out, the dissatisfaction rate is a whopping 24%. (Of course, if you assume angry buyers are more likely to leave feedback on Amazon than happy buyers, which makes intuitive sense, then you would expect negative feedback numbers are always inflated in the first place. But either way, a seller who aggressively targets posters of negative feedback is going to look better than it should compared to others.)
What’s so wrong with buying off disgruntled customers? Isn’t it the nice thing to do – to give them a token of apology for their trouble? Sure. But the net effect of this practice is detrimental to the buyer community as a whole, since the bad seller’s feedback rating is no longer an accurate reflection of its performance. The buyers who have been bought off with the token of apology are still unhappy, after all! They’re just less unhappy. Competitor sellers who actually engage in good business practices, accurately describe their merchandise, and have decent customer service still didn’t get that valuable sale. And most importantly, the feedback information used by future buyers to pick the sellers they want to buy from is not accurate, so in future transactions, both good actor competitors and buyers will continue to lose out.
Back in the old days, well-regarded brick and mortar merchants often offered apologies and/or discounts without demanding any quid pro quo from the customer. The merchant either genuinely wanted to do the right thing, or (more likely) assumed the repeat business and good word-of-mouth would be sufficient benefit. But since sellers at Amazon Marketplace probably get little repeat business, the only “word of mouth” they need to worry about is through Amazon’s own feedback system. If scrubbing your Amazon feedback clean is cheaper than having decent customer service in the first place, that’s exactly what you’re going to do: it makes economic sense.I have no way of knowing how many people accept any_book’s offer to refund shipping costs and delete their negative feedback. But Amazon does. Unfortunately, Amazon only notices/cares if large numbers of people file A-Z refund claims, forcing Amazon to get directly involved. (Which, in this case, I eventually did – but FYI, you only get five A-Z claims over your shopping lifetime with Amazon Marketplace).
So what is going on with any_book and sellers like it? Here’s a hypothesis from an amused onlooker:
any_book is one of many third-party sellers on Amazon whose primary business isn’t bookselling. Their internet presence is based on something entirely different, but selling books for outrageous prices is icing on the cake if/when someone buys one (which is highly unlikely).
Like many other third-party sellers, any_book advertises books they don’t own. If someone orders one of their advertised books, they scour the internet for a new copy of the book (which often comes from the publisher) and they buy it and ship it to their customer, pocketing the different between their cost and the outrageous amount paid by their customer.
That’s an interesting hypothesis. It would explain why they didn’t ship until a full two weeks after I ordered. But I didn’t overpay for my book – it was reasonably priced.
On the other hand, I thought I was buying the new copy they advertised. For a used copy, I did overpay several times. Perhaps any_book anticipates that buyers will have to accept what they get? This might work for students, who buy textbooks and absolutely must have them by a certain date – they end up stuck with a used copy, but don’t have time to return it and get another. Poor students are exactly the cash-strapped demographic most likely to scour Amazon Marketplace for cheaper copies of overpriced, scarce high-margin books, like textbooks. They’re also more tempted to take a pittance in exchange for removing their negative feedback. In other words, preying on students could be a profitable business strategy. This hypothesis is only supported by any_book’s non sequitur of a response to my objection that they sent me a used book, not the new one I advertised: they suggested I keep it, in exchange for a paltry 20% discount! Since new textbooks go for significantly more than 20% over used copies, if I’d accepted their deal, they’d still have been making a tidy profit – and I’d still be ripped off. Hmmmmm.
What are the options for buyers ripped off by online sellers? Pretty much the same options buyers traditionally have: complain, call your credit card company, file a claim in small claims court if you have to, report the seller to anyone who’ll listen. But these sanctions just aren’t very effective. I think the traditional community shaming function played by the six-o-clock news segment on the crappy furniture company is a lot more effective than complaining to customer service at companies that may not even have a customer service staff. (There are some blogospheric analogies to this, but I doubt they have the punch of a local TV spot deriding an intransigent local business). So why hasn’t the community nature of the ‘net lent itself to an even more powerful and effective community shaming function online? Why is Yelp the best we’ve got? Is part of it that increasingly, we don’t trust opinions and endorsements from our larger networks?
The truth is, buyers are as much on their own as they ever were before the internet. All the “feedback” and star ratings and other “community” trappings are easily manipulated by large sellers at the expense of both buyers and small sellers. So the first rule for any buyer should be to do what I neglected to do – Google your seller, and dig for complaints by other disgruntled customers. Unfortunately, that won’t always protect you. I haven’t mentioned that any_book was actually the second seller I ordered from. The first one, a small seller at Half.com, canceled the sale and refunded my money after a week with no explanation. That’s why I was ordering from any_book in such a poorly researched rush – because I’d already lost a week waiting on another deadbeat seller, who as an individual person in a nearby state (I try to minimize shipping distance to reduce fuel expenditures on shipping) with less than ten feedback ratings, and no Google record as a seller, was the exact opposite of any_book (except for the deadbeat part). Online shopping for the win – not.
In the end, I dealt with any_book with Amazon’s help. (For the record, while you have to jump through hoops to get an A-Z claim filed, once you do, my experience is positive. I just wish it wasn’t necessary to waste two months fighting with a scammer seller before Amazon stepped in to make me whole). But I’m sure many of you have similar stories about online retailers – maybe much worse ones (though I hope not). So, I’ll hand off to you, readers: any ideas or suggestions for ways to build a better community deterrent system to deal with online sellers, or ways to improve the value of existing feedback systems to the community?
Even if you have no ideas for changing the system, I urge you to think about the feedback you do leave as a public service. Truthful feedback really can help other buyers avoid getting ripped off, and direct business to sellers who act in good faith. And while it may feel futile or pointless, it’s one of those benefits that can only accrue if a lot of us chip in for no immediate reward. (Kind of like voting. But that’s ANOTHER story. . . )