Why online reputation systems have a long way to go
eBay will eliminate negative rankings from May, according to the BBC. This makes what was barely useful into something practically useless.
It’s interesting that when you talk about reputation systems, most people refer to eBay’s feedback and ratings system. It was in fact clear years ago that eBay’s ratings had very little value. The essence of the problem was that there was no incentive to rate people poorly. Since buyers and sellers rate each other, any negative rating can – and often is – reciprocated with another negative rating. However a positive rating is also likely to be reciprocated. Because anyone with any experience on eBay well understands this, almost no-one gives negative ratings, so there is very little correlation between eBay ratings and how good a trading partner people actually are.
Now eBay has recognized this publicly, rather than pretending that its ratings are valid, and is explicitly pointing to users’ retaliation to negative reviews. The BBC article says that eBay says that there are other mechanisms to protect users:
“If a buyer doesn’t pay, the seller can easily contact eBay, we will review any complaint and maybe remove the buyer,” a spokesman said.
The changes aim to “improve the overall customer experience”, eBay said.
It added that many buyers would not leave negative comments for fear that sellers would retaliate.
As a result, buyers and sellers may not get a fair picture of what is actually happening between trading parties.
It maintains that the majority of transactions go “swimmingly”.
EBay says that only a minority of sellers leave negative feedback for buyers.
Many of the online services exchanges such as eLance and Rentacoder have considerably more sophisticated ratings systems than eBay, but they are generally still subject to the same problem of two-way ratings being reciprocated.
The value of effective reputation systems is immense, but systems such as blinds and mutual ratings being made independently are required. Despite the famed eBay reputation system being introduced now over 10 years ago, in February 1996, we haven’t got a lot further in that time.
