Problem
Imagine you want to discover a new place to visit: whether it's an exotic country with incredible cuisine and beaches, a cozy cafe for work, or a hotel for a vacation. Where will you start your search? Naturally, you'll head to review services.
Fake locations and boosted ratings pose significant problems in the recommendation industry. Many businesses manipulate their reviews and ratings to appear more favorable, misleading consumers and eroding trust in online reviews. Users often encounter exaggerated claims or entirely false information about places, leading to disappointing experiences. This practice undermines genuine businesses that rely on quality service rather than deceptive marketing.
A few numbers
Digital platforms play a significant role in shaping consumer behavior. Over 92% of people search for information online, a statistic that underscores the importance of these platforms in influencing consumer decisions.
More than half of millennials (born 1981-1996) and Gen Z (born 1997-2012) use social media to plan trips or choose destinations. 67% of millennials post about their experiences on social media.
Recommendations are crucial for consumers. Most business people (41%) and leisure seekers (60%) rely on online research.
Notably, 95.1% read at least seven reviews before booking a hotel, emphasizing the importance of online presence and reputation management.
Negative reviews and their impact
Negative reviews can seriously affect buyers decisions: products and services with 1 or 2 star reviews do not attract 86% of potential customers. This underscores the significant impact of online reviews on consumer behavior. [1]
Large companies are increasingly hiring full-time reputation managers to work with their online presence and reviews. In 2020, Google removed around 55 million reviews that violated its policy. The US Federal Trade Commission has taken action against fake reviews: in 2021, more than 700 companies were accused of deceptive endorsements. This indicates the growing importance of online reputation in business strategy and the potential for platforms to influence reviews.
Fake reviews and the imperfection of the system
Around 80% of consumers have encountered fake reviews in 2023. This problem is more relevant for young people: 92% of respondents aged 18 to 34 reported that they have come across fake reviews. Around 67% of consumers consider fake reviews to be a serious problem [2].
The problem of review unreliability affects both visitors and companies. Purchased positive reviews spoil the impression of clients when they discover a total mismatch with reality and poor service. In turn, a businesses suffers from attacks by unscrupulous competitors with fake 1-star reviews. According to various industry observers, from 30 to 40% of online reviews are fabricated or are not entirely genuine [3]. And less than 1% are removed by corporations as fakes. There is even a movement of Yelpers who create negative reviews and extort money for their removal. Cases of wild popularity of non-existent restaurants and cafes in different cities around the world put the entire review system in jeopardy:
The world is changing thanks to Gen-Z individuals. 65% of them consider spending on experiences the most significant way to allocate their funds.
They are increasingly using cryptocurrency in real life, which is why 39% of businesses in the tourism industry now accept cryptocurrencies, offering customers an alternative payment option and simplifying international transactions.
daGama offers a solution that we will tell you about in the next section.
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