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Yelp Consumer Alerts: Great Move. What Took You So Long?

Posted October 24th, 2012 by Andrew Goodman

It’s neat to see Yelp sending out a chill among businesses considering cheating the review process, by implementing a highly visible shaming system that points out in no uncertain terms when a business conspires to post fake reviews.

Critics of Yelp used to complain that Yelp was anti-business because they demanded payment (in the form of ad buys) in exchange for favorable reviews. Those allegations are unproven despite several court cases. Now some critics will no doubt imply that this latest move makes Yelp “hostile” to business.

On the contrary. Companies like Yelp must offer a level playing field and a safe and fun platform for consumers. That’s the only way to help consumers and to (ultimately) highlight great businesses. If that means being tough on abuse, then that’s exactly what Yelp needs to do.

We’re just glad they’ve finally taken the plunge.

As I announced here 17 months ago (!), HomeStars decided to take the lead in this area, and took an aggressive stance against perpetrators of fake or “suspicious” reviews. HomeStars was the first to highlight this prominent “calling out the cheaters” style badging, and continues to work (as we’ve been delighted to see over at Yelp) on making the entire process as transparent as possible.

As every consumer and every participating business knows, review sites are a work in progress – as evidenced by the give and take when new features like this get rolled out. But the debates themselves are signs of this space slowly but surely maturing.

All reviews are subjective. Yet people still find them incredibly useful. One of the most important tasks is simply to crack down on the fake ones.

Onward and upward!

6 Responses to “Yelp Consumer Alerts: Great Move. What Took You So Long?”

  1. Alex says:

    I disagree that yelp is not hostile to small businesses. Maybe “hostile” is not the right word, but indifferent would probably be a better description of them.

    You can see what other individuals and businesses are saying here:

  2. I’m sure there are some valid concerns there, but consider the scale of what Yelp is trying to do.

    Imagine if you allowed business owners who were unsatisfied with their Google rankings to complain in a single thread about how sucky Google is for not ranking them well. Would be a pretty long thread… wouldn’t it?

    Business owner Robert N. speaks his mind — unfortunately betraying a belief that is prevalent among “throwback” business owners clinging to the old reality when consumers had limited access to word of mouth information. “Not everyone deserves a voice,” he writes.

    The fact that Yelp also dials for dollars to sell advertising listings simply isn’t material to the quality and usefulness of the site as a review platform. People keep trying to tie the two together, but time after time the courts rule that they are not tied together.

    Reputation management is a “nightmare” or an opportunity for many businesses. But above all what it is is the new reality. We’ve just seen the tip of the iceberg thus far. And so many businesses are responding positively to the opportunity.

  3. Alex says:

    Andrew, you make some good points and I agree with some of them.

    Here are my suggestions to the yelp HQ if they’re reading this:

    I feel that the review filter, though imperfect is needed at this point.

    However, just a few simple minor changes to yelp can help resolve many issues:

    1- move the “filtered reviews” button to the top so that its easily findable by any novice non-yelper

    2- get rid of the captcha hurdle. What’s the point of it being there anyways?

    3- have an independent third party verify that yelp’s algorithm is truly unbiased. Yes, it’s a trade secret and they’re not obligated to have an independent third party look into it, but if I was in Jeremy Stoppelman’s shoes, that’s what I would do.

    Have a beautuful day :)

  4. Helen says:

    In an effort to address growing concerns about profitability for the newly public company, San Francisco based Yelp has “outed” businesses allegedly purchasing positive reviews via craigslist and other online venues.

    Confrontations with small businesses are nothing new for the online review directory of small businesses. Repeated accusations, and even legal battles, have placed the issue in the news for some time. Small businesses as diverse as veterinary hospitals, children’s party planners, and restaurants have accused the company giving negative reviews prominent top-tier placement on a business profile page and requiring word verification “capcha” text to read the majority of positive reviews.

    While Yelp’s motives for manipulating the placements of reviews might be explained as an attempt to offer credibility to the authenticity of the reviews, the behavior of the local search behemoth belies that assumption.

    Regularly accused of small business blackmail, the company has faced recurring claims that negative reviews are used as leverage to extort advertising revenue, in some cases promising to make negative reviews less prominent for small business that enter into monthly contracts of several hundred dollars.
    Yelp claims its algorithm for review authenticity is probably too aggressive, but the explanation falls short with many small businesses, which claim Yelp extorts small business with strong arm tactics. Negative reviews on Yelp receive little or no scrutiny while positive reviews are consistently assumed false and subject to rigorous verification. In addition, a new breed of cyberbully has arisen.

    These are “customers” some newspapers have labeled Yelp Extortionists who threaten establishments with negative reviews unless they receive free services, gift cards, and more.

    Many small businesses are therefore faced with a system that indicates Yelp favors negative reviews in both profile placement and assumed legitimacy and actually adds steps for consumers to enable access to positive reviews. A number of businesses feel pressured to pay, either within Yelp’s advertising programs or by soliciting reviews in the hopes that some will be displayed. Rather than address real concerns in the media and in court that Yelp’s practices amount to extortion, Yelp has instead attacked businesses attempting to respond to the situation.

    Their recent “sting” operation responded to what Yelp claims is rampant review dishonesty. Evidently, the rampant dishonesty was represented by…eight businesses. Yelp certainly makes clear in its terms of service that paid reviews are off limits, but their motives are unclear. Yelp is opposed to any solicitation of reviews, which according to their official blog means in any way indicating to a customer that a review can be left.

    Yelp suggests building a review base by promoting Yelp. Businesses are encouraged to link to the site via provided images and badges, to print images for in store point of sale, and to include links to Yelp in email signatures. calls Yelp’s campaign to humiliate small businesses “embarrassing” and suggests the company’s attempts to gain by it are motivated primarily out of fear for rising competition from Google Plus, Google Places, and the recent acquisition of Zagat.

    The entire campaign is likely to backfire. One online analyst argues that Yelp’s hardline response not only reveals the prevalence of fake reviews on the site but also offends the only customer base the company targets. Online social networking sites have a unique advantage because an entry into the market by one of the giants will allow for potential users to filter reviews by friends and associates, adding trustworthiness that is uniquely personal.

    Is there a solution that addresses Yelp’s desire for authentic, uncompensated reviews? Probably not. Ultimately, the online giant is likely to face consistently degrading returns as other companies enter the market. Additionally, online review systems by their nature encourage negative rather than positive reviews. It is possible to mitigate some of the harm, however. Many have advocated a third-party algorithm, a means by which reviews are filtered that neither Yelp, users, or small businesses control. Such a system would put a wall between the reviews and the revenue and finally put to rest the concerns about Yelp’s business practices while simultaneously building confidence in the end result.

    None of the small businesses targeted for embarrassment by Yelp are not giant corporations. They represent the beginning levels of the “American Dream”, family operations attempting to better their families, their communities, and their station. One might argue that cheating the system justifies the shame, but serious concerns remain that cheating occurs at all levels of the relationship, and only those who suffer the most from repercussions have to face them.

  5. JC says:

    Do people still use yelp?

  6. Andre Buxey says:

    I was planning on using Yelp just as the story broke of them being detrimental to business owners, since then i have stayed as far away as possible from them and for good measure.


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