••• social media research
AG intervenes to protect the online consumer review
As consumers become more reliant on online reviews to guide purchases, companies have taken extreme – and extremely dishonest – measures to boost their image via online reviews. Dubbed “astroturfing,” posting fake reviews on consumer-review Web sites has become a common problem that compromises the quality and integrity of online reviews. Gartner projects that by 2014, 10-15 percent of social media reviews will be fake.
And it’s no wonder why astroturfing has become common practice: A 2011 Harvard Business School study estimated that a one-star rating increase on Yelp translated to an increase of 5-9 percent in revenues for a restaurant and Cornell researchers found that a one-star rise in a hotel’s online ratings on sites like Travelocity and TripAdvisor is tied to an 11 percent increase in room rates.
The good news is that the government is taking action to thwart astroturfing. On September 23, Attorney General Eric T. Schneiderman announced that Operation Clean Turf – a year-long undercover investigation into the reputation management industry, the manipulation of consumer-review Web sites and the practice of astroturfing – resulted in 19 companies agreeing to cease writing fake online reviews for businesses and to pay more than $350,000 in penalties. Producing fake reviews violates multiple state laws against false advertising.
“This investigation into large-scale, intentional deceit across the Internet tells us that we should approach online reviews with caution. And companies that continue to engage in these practices should take note: Astroturfing is the 21st century’s version of false advertising and prosecutors have many tools at their disposal to put an end to it,” said Schneiderman.
••• millennials
Gen Y and four new standards of luxury
The definitions of status, success and wealth are changing as Millennials come of age and reach peak earning years. According to Unit Marketing, there are four important ways in which Millennials are different from previous generations.
Millennials will reject the status symbols of their parents. Millennials will find status in achievements rather than purchases. They find significantly more satisfaction from earning a degree or completing an athletic event than by items they purchase. For example, a Millennial is likely to be more interested in owning a $500 Ironman triathlon watch signifying the achievement than a $5,000 brand-name watch.
Millennials will trade money for time and will therefore have less money to spend on luxury items. A Millennial may be willing work less overtime and see slower career progress to enjoy their time now.
Millennials will shift from conspicuous consumption to conscious consumption, guided by social, environmental and ethical values. This attitude is evident in the generation’s rent-rather-than-buy tendencies.
Millennials think of “luxury” as a marketer’s label. They are aware of marketing techniques and perceive the term “luxury” as a tool to entice them to buy rather than an adjective conveying something important about a product.