That’s an interesting point. The genesis of the question is that I trawled through reddit. Obviously there is selection bias (people with negative views tend to post). Most of the negative traffic on trustpilot is related to negative reviews being taken down, even after reviewers provide documentation.
Fair enough, I see it being unlikely and not in their best long-term interest to remove real reviews for customers, but I could be wrong.
Regarding posts on Reddit, it’s possible they were automatically flagged/removed by Trustpilot’s system (not a person), or they were in conflict of guidelines.
Some general thoughts regarding online reviews:
1. Due to the number of reviews submitted each day there needs to be an automated system to filter reviews.
2. Fake reviews will be a problem forever because there are big incentives to leave fake bad reviews on competitors pages or fake good reviews on your own page.
3. I think an automated system should be more strict on negative reviews than good reviews because under normal circumstances the impact of a fake bad review is larger than a fake good review.
4. AI has only made it harder to discern real reviews. I know Trustpilot has discussed a verification system which could help i.e. you can verify you’re a real person and it denotes that on your review.
5. I believe Trustpilot is doing their best and allocating resources to solving these issues, but again I could be wrong.
Either way, just my thoughts and I don’t think any of the above significantly impairs Trustpilot’s strong business model driven by network effects and customer marketing.
Late to this party. One question for you on the incentive alignment: isn’t it arguably more problematic that businesses pay Trustpilot for services on the platform? That seems like a stronger conflict than just advertising on the platform.
As far as I’m aware all of these sites allow businesses to pay for services, so there will always be a conflict. But sites like Yelp allow businesses to also pay them for sponsored ads e.g. better placement, which means some customers are paying a lot more than others.
“Trust” is also a pillar of Trustpilot’s business model and culture, from their website:
“As an independent review platform whose mission is to bring consumers and businesses together, we take a neutral stance towards reviews. For example, no business can pay to have reviews delayed or removed and everyone has to follow the same rules.
Our Content Integrity Team gives equal treatment to businesses that use Trustpilot for free and those that subscribe to our services. Our commitment to fairness and creating a level playing field provides the very foundation on which we operate and we’re passionate about keeping it that way.”
That’s an interesting point. The genesis of the question is that I trawled through reddit. Obviously there is selection bias (people with negative views tend to post). Most of the negative traffic on trustpilot is related to negative reviews being taken down, even after reviewers provide documentation.
Fair enough, I see it being unlikely and not in their best long-term interest to remove real reviews for customers, but I could be wrong.
Regarding posts on Reddit, it’s possible they were automatically flagged/removed by Trustpilot’s system (not a person), or they were in conflict of guidelines.
Some general thoughts regarding online reviews:
1. Due to the number of reviews submitted each day there needs to be an automated system to filter reviews.
2. Fake reviews will be a problem forever because there are big incentives to leave fake bad reviews on competitors pages or fake good reviews on your own page.
3. I think an automated system should be more strict on negative reviews than good reviews because under normal circumstances the impact of a fake bad review is larger than a fake good review.
4. AI has only made it harder to discern real reviews. I know Trustpilot has discussed a verification system which could help i.e. you can verify you’re a real person and it denotes that on your review.
5. I believe Trustpilot is doing their best and allocating resources to solving these issues, but again I could be wrong.
Either way, just my thoughts and I don’t think any of the above significantly impairs Trustpilot’s strong business model driven by network effects and customer marketing.
Late to this party. One question for you on the incentive alignment: isn’t it arguably more problematic that businesses pay Trustpilot for services on the platform? That seems like a stronger conflict than just advertising on the platform.
As far as I’m aware all of these sites allow businesses to pay for services, so there will always be a conflict. But sites like Yelp allow businesses to also pay them for sponsored ads e.g. better placement, which means some customers are paying a lot more than others.
“Trust” is also a pillar of Trustpilot’s business model and culture, from their website:
“As an independent review platform whose mission is to bring consumers and businesses together, we take a neutral stance towards reviews. For example, no business can pay to have reviews delayed or removed and everyone has to follow the same rules.
Our Content Integrity Team gives equal treatment to businesses that use Trustpilot for free and those that subscribe to our services. Our commitment to fairness and creating a level playing field provides the very foundation on which we operate and we’re passionate about keeping it that way.”
The valuation does appear to be a big opportunity. Thx again Mr. Curious Investor!