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CMA launches inquiry into online review sites

The Competition and Markets Authority (CMA) has called for consumers, business and interested parties to share their views on how information in online reviews and endorsements is used. 

CMA said that it was aware of a number of concerns about the trustworthiness or impartiality of information in some reviews and endorsements that is being provides to consumers. As a result the body is keen to gather information to see if these concerns are “valid”.

It said that online reviews and blogs are playing a growing role in helping consumers to make shopping decisions, including finding hotels, and that it is important that these sites work as well as they can for consumers and for businesses.

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As well as looking at a range of online reviews and endorsements found on web blogs, video blogs, social media, review and operator sites, the CMA will also look at the roles media companies, online reputation managers and search engine optimisers play in helping businesses to promote themselves and manage their image.

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Nisha Arora, senior director at CMA, said: “The information contained in online reviews and endorsements can be a powerful force in the hands of consumers. Informed consumers make better decisions, driving competition on price and quality.

“Businesses have always known that ‘word of mouth’ is one of the most important factors for potential customers; what online reviews and blogs do is to provide a greatly amplified version of this. However, for this sector to work well it is important that this information is genuine, relevant and trustworthy.”

Arora said that one of CMA’s priorities as a new authority is to take a closer look at developments and practices in online markets, and that more information about the impact of online review sites is needed before further action is taken.

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