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FTC Issues Over $527,000 in Refunds for Victims of Review Hijacking on Amazon

The Federal Trade Commission addresses deceptive marketing tactics by The Bountiful Company, offering financial restitution to misled e-commerce and subscription buyers on Amazon.

FTC warns against subscription tricks and traps, steps up enforcementThe Federal Trade Commission (FTC) has initiated a substantial refund operation, returning more than $527,000 to consumers misled by deceptive marketing tactics on Amazon.com. The refunds specifically target e-commerce and subscription buyers of certain Nature’s Bounty and Sundown vitamins and supplements, products distributed by The Bountiful Company (Owned by Nestle). 

The action follows a February 2023 complaint by the FTC, accusing Bountiful of exploiting Amazon.com’s review system. The company allegedly manipulated product listings to display misleading information about consumer ratings and reviews. This practice, identified as “review hijacking,” involved presenting new supplements as if they had garnered numerous high ratings and reviews, wrongly attributing them “#1 Best Seller” and “Amazon’s Choice” badges. This marks the FTC’s inaugural move against such deceptive practices, addressing the misuse of customer feedback mechanisms to artificially inflate product popularity and sales.

As part of the settlement, Bountiful is required to compensate affected consumers and is prohibited from engaging in similar deceptive marketing tactics in the future. The resolution aims to maintain the integrity of customer reviews and prevent the manipulation of consumer perception.

The FTC is distributing 32,689 refund checks to eligible consumers, urging them to deposit or cash their checks within a specified 90-day period. The checks are part of the agency’s broader effort to combat deceptive marketing and ensure transparency in consumer feedback mechanisms online.

The settlement and subsequent refunds send a significant message to subscription businesses and online retailers. The enforcement action underscores the importance of genuine customer feedback and the repercussions of deceptive practices. Companies leveraging reviews to boost their subscriptions and product sales must ensure their marketing practices are transparent and honest.

INSIDER TAKE

The FTC’s crackdown on “review hijacking” highlights the growing scrutiny of online marketing tactics and the importance of maintaining authentic customer interactions.

For businesses, this development stresses the need for transparency in how reviews and ratings are presented and utilized. As consumers increasingly rely on these metrics to make purchasing decisions, the integrity of these systems is paramount. Companies employing misleading tactics risk legal repercussions and damage to their reputation and consumer trust.

Furthermore, this case may prompt e-commerce platforms like Amazon to further tighten their review and rating systems to prevent misuse. This could lead to more stringent controls and verification processes, impacting how products are marketed and sold online.

The FTC’s action against The Bountiful Company serves as a warning to all subscription businesses: deceptive marketing, especially concerning consumer reviews and ratings, will not be tolerated. It underscores the necessity for businesses to foster an environment of transparency and honesty in online retail spaces.

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