New Law Will Prevent Retaliation Toward Negative Online Reviews

Online reviews are double-edged swords for small businesses. On one hand, positive digital word of mouth can help drum up new business. A recent Mintel survey found that nearly 70 percent of consumers rely on online reviews before they make a purchase, and the more five-star ratings they see, the better.

On the other hand, it only takes a few disgruntled customers to make a business look bad and noticeably hurt sales. Owners are understandably worried about the possibility of losing everything they have worked for.

Recently, Congress added a new wrinkle into the mix. In passing The Consumer Review Fairness Act, Congress wants to make it illegal for a business to prevent a customer from writing and spreading negative reviews, according the Washington Post. The bill now heads to President Obama, who is expected to sign it into law shortly.

The impetus for this legislation appears to be a dispute between the online commerce company Kleargear and a pair of customers from Utah. The Daily Dot reports that the company fined the customers $3,500 in response to a negative review they left online, citing an anti-disparagement clause in the terms of service agreement. When the customers refused to pay, the company followed up with a collections agency and was eventually sued as a result. The customers won their case and were awarded more than $300,000, according to the report. They later testified before the Commerce Committee on this issue.

Adjusting to the new reality
It's certainly true that most businesses have never sought to punish patrons for poor reviews. Even still, they have an incentive to avoid bad press. What can business owners do to limit negative reviews while still complying with the new law?

Obviously, maximizing customer satisfaction requires a special emphasis on service and responsiveness. Business.com suggests more outreach to build goodwill. This means rapidly responding to incidents that negatively affect the customer experience and making them right as soon as possible. In addition, offering incentives to those who leave reviews – regardless of their content – can impart good feelings on customers.

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Categorised in: Business Law

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