Where Everybody is Awesome

This past week I've been selling some stuff on Ebay. I have a 99.1% approval rating as a buyer and seller, which sounds impressive, but actually is not as I'll talk about below. What that means is that out of 114 transactions with new customers, 113 have been happy with me as a buyer or seller. What about the one dissatisfied person? That happened early in my Ebay career. I bought an item that was advertised as being a power supply suitable for an IBM laptop. It wasn't suitable at all. I emailed the seller telling him exactly why it wouldn't work on an IBM and returned the item.

Since he had misadvertised the item and made me pay to ship it back, I gave him a "neutral" rating for the transaction. In response, he gave me a "negative" rating. I found out immediately the repercussions of being honest in assessment on Ebay. There is a feedback loop. If you give a positive assessment, you will get one in return. If you give a negative or neutral assessment, you will be relegated to Ebay hell.

I've never given a negative rating since then. If somebody is dishonest in what they sell or is late to pay I simply leave no feedback. And virtually everyone else is doing the same thing. What this means is that everyone on Ebay has ridiculously high approval ratings. You have to recalibrate to make assessments. Approval ratings of 95% or less mean that the person is a true deadbeat and scumbag. As a buyer, I will not buy a damn thing from anyone with an approval rate of less than 99%. And even then, that's iffy. It's best to stick with sellers with approval ratings of 99.5% or greater.

As a seller, I don't have that recourse. Right now I'm dealing with a deadbeat buyer of an item of mine (no payment) with an approval rating of 98.9%. I'm trying to get Ebay to simply void the transaction so I can avoid the prospect of a negative rating from him.

Evaluations like this where there is a feedback loop simply don't work. There is a strong disincentive to being honest and giving negative evaluations on occasion. On Ebay, everybody is "awesome" on paper.* But of course they aren't in reality.

The same thing happens when it comes to grading in college. Ever since student evaluation forms came to the fore in the 1980s, grades have been rising. Professors aren't dumb. They know that if they give a low grade they will receive a low evaluation in return. So almost everyone gets a B or better. If current trends continue, everyone will literally have a 3.9 GPA or better at every major college in this country by 2100. College GPAs will be like Ebay approval ratings. Everybody will be Einstein.

You see a similar thing when it comes to magazine reviews of consumer products. For instance, music magazines are highly dependent on record companies for advertising revenue. If a magazine like Rolling Stone or Paste were to give honest and critical reviews, the record companies would likely retaliate by pulling advertising. As a result, the reviews and interviews in these magazines tend to be unctuous and fawning things. All of those CDs are awesome. All of the musicians are geniuses.

The problem with all of this of course is that evaluations that are dishonest and consistently full of hyperbole are worthless. On Ebay, it's essentially impossible to identify scummy buyers and sellers. In college, it's hard to distinguish the great from the mediocre students. In magazines, it's impossible to know whether a music CD is good or junk.

It turns out the public does want critical evaluations. They're just hard to find. But when they exist, the public responds. Consumer Reports is a magazine that accepts no advertising and trashes lousy products all of the time. They have a circulation of 4,000,000. In the truth is stranger than fiction world, the indie rock website Pitchfork frequently gives nasty reviews and as a result has become the de facto music taste maker for college students. If a CD gets a rare 9.0 rating or better on Pitchfork, college students will flock to download and buy the music; that musical act is guaranteed a great touring season chock full of fans who want to see the latest buzz band.

Next time you see a four star review of a car or a piece of software in a magazine take a look at the advertising pages. Chances are that they will contain at least a few full page ads from the manufacturer of that item. And that glowing review isn't an evaluation at all. It's simply a thank you letter to the advertiser.

*Just a note that whenever I hear the word awesome, I cringe. OK, I know I'm a cranky old guy.