On January 14, the issue of the Sam's Club APP defaulting to five-star praise was punished for attracting attention. A few days ago, the Guangdong Provincial Municipal Supervision Bureau released a guiding case on anti-unfair competition law enforcement, in which the Sam's Club App defaulted to five-star praise and was fined 300,000 yuan. The Guangdong Municipal Supervision Bureau believes that Sam's move has made false commercial publicity about the user evaluation of the product, deceiving and misleading consumers.
The Beijing News Shell financial reporter found that the praise rate of a certain product at the top of the Sam's Club App category ranking was about 95%. In this regard, some experts told the shell financial reporter that the default five-star praise of the software on the market belongs to the false publicity of the merchants on the quality of the goods, violating the relevant provisions of the "Anti-Unfair Competition Law", and some acts have not been punished by the market supervision department, which does not mean that this behavior is legal.
Shell financial reporter combed and found that recently Sam's Club has been on the hot search for many times, which has since triggered a boom in member card withdrawal. Sam's parent company, Walmart, has closed nearly 80 stores in China in the past six years. In November 2021, the first Walmart in Shenzhen Chinese mainland was also shut down.
Automatic default five-star praise, praise water injection rate up to 95%
On January 11, 2022, the Guangdong Provincial Municipal Supervision Bureau held the second session of the Guangdong Provincial Anti-Unfair Competition Law Enforcement Lecture Hall in Foshan. At the lecture hall, the spokesperson of the Provincial and Municipal Supervision Bureau released 12 guiding cases on anti-unfair competition law enforcement, including false publicity of Guangzhou Qian Dama E-commerce Co., Ltd., price violation cases, and false user evaluation cases of Wal-Mart (China) Investment Co., Ltd.
Screenshot of the webpage of the Guangdong Provincial Municipal Supervision Bureau.
Relevant documents show that after investigation, during the period from October 13, 2020 to May 17, 2021, Wal-Mart Company used the Sam's Club APP to sell goods online, in the "My Evaluation", when the user did not make an active evaluation of the real traded goods in time, the APP background system will automatically default to the five-star praise, and the default five-star praise will be automatically calculated in the praise rate for display, and there is false commercial publicity for the user evaluation of the product, deceiving and misleading consumers.
Screenshot of documents of Guangdong Provincial Municipal Supervision Bureau.
The Futian Supervision Bureau of the Shenzhen Municipal Bureau of Market Supervision believes that Wal-Mart's above-mentioned acts violate the provisions of Article 8, Paragraph 1 of the Anti-Unfair Competition Law of the People's Republic of China, and according to the provisions of Article 20, Paragraph 1 of the Anti-Unfair Competition Law of the People's Republic of China, the law enforcement authorities ordered it to stop the illegal acts and imposed a fine of 300,000 yuan.
In addition, the Guangdong Provincial Municipal Supervision Bureau said that the "default praise" is not a real user evaluation, and the false praise rate data is a misinterpretation of the existing consumer evaluation, and will form a clear misleading of potential consumers, constituting false publicity.
The law enforcement organs ascertain the true situation of the background data and impose qualitative penalties for such acts in accordance with the provisions of the first paragraph of article 8 of the Anti-Unfair Competition Law of the People's Republic of China, which not only clearly indicates the market supervision department's opinions on the determination and handling of false publicity of platform data, but also plays a good demonstration effect of "interpreting the law by case" through case guidance and regulating the evaluation system of e-commerce platforms.
Shell financial reporter opened the Sam's Club App, looked at the bedroom good list TOP1 of a pure mulberry silkworm silk winter was found in the comment area, the product has a total of 205 member reviews, the overall praise rate of 96.5%, of which there are 198 praises, however, in the default sorting, the first ten of the product praise for the user's independent evaluation, the remaining 188 are the system default five-star praise, praise water injection rate of up to 94.9%.
Sam's Club user reviews.
On the afternoon of January 14, the Beijing News Shell financial reporter contacted Sam's Club on this matter, but has not been able to get communication. According to observations, its official Weibo and others have not yet responded to the matter.
Is the default praise of online shopping and takeaway software the same violation? Experts say not being punished does not mean it is legitimate
The penalty for the Sam's Club App unveiled the tip of the iceberg of anti-unfair competition enforcement. Under the relevant hot search terms, many netizens reflect that they forgot to comment when shopping online or ordering takeaway, and the software will automatically give the merchant a five-star praise.
In this regard, Zhao Zhanzhang, deputy director of Beijing Yunjia Law Firm and researcher of the Intellectual Property Research Center of China University of Political Science and Law, believes that consumers' evaluation of merchants' products and services is not only the legal right of consumers, but also greatly affects the shopping choices of other consumers. If consumers do not evaluate the real transaction and are given five stars or other positive evaluations by default, it is actually a kind of false publicity about the quality or service of the merchant, which violates the provisions of the Anti-Unfair Competition Law.
For the phenomenon that consumers on online shopping and takeaway platforms did not take the initiative to evaluate, and the system also defaulted to the phenomenon of five-star praise, Zhao Zhanzhan said that the market supervision department did not punish it, which does not mean that this behavior is legal. "It's a regulatory issue, it could be something that regulators haven't identified, paid attention to, or selectively enforced." Zhao Zhanzhan said.
So, when consumers do not take the initiative to evaluate the product, how should the platform deal with it?
Xue Jun, vice dean of Peking University Law School, believes that if consumers do not evaluate the goods, the platform should display them truthfully. If you must default to ratings, the platform should automatically default to "normal" ratings, rather than misleading five-star reviews. "The average consumer will comment on the product if they are particularly fond of it or are particularly dissatisfied with the product, and in other cases, the consumer may feel that it is general and will not comment. Therefore, it is necessary to default to the evaluation, and it is most appropriate to default to 'normal'."
Wal-Mart hypermarkets closed stores in batches, and recently Sam's Club has a "card refund boom"
It is worth noting that in December 2021, Walmart closed the first Walmart store in Chinese mainland in Shenzhen. Earlier, Wal-Mart responded to the Beijing News reporter that the closure was because the owner was about to upgrade the property as a whole.
In the past 6 years, Walmart hypermarkets have closed nearly 80 stores in China. In contrast, Sam's supermarket, a Member of Walmart, is expanding in China. In September 2021, Sam's Club just landed in Shanghai and set off a wave of membership-based supermarkets. According to Sam's Club, it operates 36 stores in 23 cities as of November 2021 and plans to increase to 100 in the next 8 years.
Wal-Mart's fiscal third quarter of 2022 disclosed that Walmart's revenue in the quarter increased by 4.3% year-on-year, and net profit fell by nearly 40%. Despite the dismal performance of hypermarkets, Sam's Club revenue showed an upward trend, with Sam's Club sales up 13.9% in the third quarter of fiscal 2022, a cumulative increase of 25% in two years, and membership revenue growth of 11.3%, achieving double-digit growth for five consecutive quarters.
Zhu Xiaojing, president and CEO of Walmart China, said at the New Consumer Forum Series Summit held in November 2021 that walmart has undergone tremendous changes in the domestic retail market in the 25 years since walmart entered China, and walmart will shift from coverage to customer acquisition and retention capabilities. "And in this transformation process, choices and trade-offs are particularly important." Zhu Xiaojing's "trade-off" seems to correspond to sam's club and Walmart's traditional retail hypermarket.
However, Sam's Club, which walmart has pinned high hopes on, has been receiving negative information in recent times.
At the end of 2021, Sam's Club was exposed to the targeted removal of Xinjiang products, which immediately triggered the indignation of the Chinese people. Sam's move was also criticized by the people's government of the Xinjiang Uyghur Autonomous Region. According to a number of local media reports, at present, in many parts of the country, there is a "Sam's member withdrawal tide", a large number of former Sam's members after seeing sam's shop against Xinjiang, choose to withdraw from membership, no longer buy Sam's products.
It is understood that the annual fee for Sam's ordinary members is 260 yuan, and the annual fee for excellent members is 680 yuan. According to Sam's Club, as of November 2021, the number of paid members in China exceeded 4 million. If the wave of Sam's membership withdrawals continues, it will cause a crisis for Sam's operations in China.
Beijing News shell financial reporter Li Menghan Editor Xu Chao Proofreader Zhang Yanjun