It’s not uncommon to see customer ratings and reviews in pitch decks. A tangible testimonial from a real person (i.e., verifiable) is useful. Those consumer 5-star ones - total BS. Challenge them viciously and without mercy.
The UK has amongst the highest energy prices of any nation. Many of the utility companies operate in an effective oligarchy. While some are better than others, I struggle to think of a single instance where someone has said, “I’ll tell you who’s a really good energy provider…” More likely, it’s an expletive-laden rant about hiked rates, power cuts, or torturous technology (apps, robotic call centres, etc.).
It is, therefore, somewhat astonishing that the reviews on sites like Trustpilot for UK energy companies show averages generally above 4 out of 5 stars for the biggies.
WTF is going on?
I had a great chat with a friend, who started TruthEngine to sniff out these fake reviews. He directed me to insurance company reviews. Now, these folks are generally all scoring above 4.8. Anyone who has ever dealt with insurers in the UK is probably now falling off their chair. My jaw also hit the floor. When you move back to the UK, insurers seem to consider you a similar risk to an 18-year-old pyromaniac speed-freak coke-fiend nepobaby. For example, our first year car insurance premium was nearly 10% of the value of the car (we live in the middle of nowhere, and the car in question is a particularly unsexy and slow hybrid). The general gouging attitude persists in almost every instance, save for the nice guy who organises our corporate insurances.
So, again, WTF? How are insurers scoring 4.9s and Japanese clothing retailer UNIQLO (who were awarded the best customer service by Newsweek ) score 1.5!?
I had to do some digging.
A few friends run businesses that rely on reviews (retail, F&B, etc.). They explained, off the record, that if you don’t pay these review companies, you suddenly find yourself sliding into UNIQLO territory. The Japanese apparel behemoth can tolerate the 1.5, but a 5-person coffee shop battling the highest energy costs, business rates, and a tax system that sees them pay more corporate tax than Starbucks cannot. One friend, running a ~30-person manufacturer, explained the fee to list on one of these sites (or face implicit threats of poor ratings) is getting near £20,000 per annum.
Surely there is a regulation to stop this? Well, yes, sort of. There is legislation in the UK, EU, US, and Australia that requires companies to protect consumers from exposure to fake reviews. Here, that regulation is called the Digital Markets, Competition and Consumers Act 2024 (DMCC Act), which makes reviewing authenticity an ongoing legal obligation. Sadly, if unsurprisingly, the regulation is currently weakly enforced.
I asked my friend at TruthEngine how widespread the practice is. I won’t share what he said exactly. I will, however, direct you to The Coalition for Trusted Reviews whose members include most of the places we go for travel, consumer, and retail reviews. This coalition, as I understand it, has multimillion-dollar funding, yet its only demonstrable activity is an annual conference. Where is the rest of the funding being spent?
LOBBYing meme
So, for us as consumers, investors, and those making decisions about which businesses to partner with, ignore all of these review sites. If you’re an investor, ask the exec team within the potential investment how much they pay the review sites or if they’ve ever paid anyone to give them positive reviews. I have credible intelligence suggesting someone companies encourage employees to set up sockpuppet (fake) accounts and leave positive reviews. See it as an integrity test during your due diligence.