Yelp’s Challenges on Display in NYT Comments

One of the comments responding to my earlier Yelp piece, about the company’s efforts to do a better job explaining its algorithm, said the following:

Unfortunately, you didn’t put the link to the NYT article which shows readers’ “comments”. There are now 64 comments from businesses all over the country. 95% of which say they were extorted, and cite specifics. 

That prompted me to go and take a look at the comments, responding to the NY Times article Q&A with Yelp CEO Jeremy Stoppelman.  I typically never pay attention to comments on a news story. I wasn’t trying to hide anything; I simply didn’t think to look for them. 

While the quote above sees conclusive evidence of extortion, I do not see that. I see confusion, frustration and resentment among some business owners. There are comments in support of Yelp and how it empowers the consumer. But I’ve selected a few critical comments to illustrate some of the frustration and confusion:

There’s an irony here: many of the “reviews” of Yelp appended to the NYT article are from anonymous readers. Nonetheless, what the comments above and others in response to the article show is that Yelp has an aggressive sales force. That is overlaid on top of SMB perceptions that reviews are manipulated according to whether a business is an advertiser. Indeed, reviews and review placement is “manipulated” to a limited degree. Here are the ways:

  • Yelp allows advertisers to select a “favorite review” to place at the top of the page (thus “manipulating” reviews)
  • Yelp removes the “you might also consider” suggestion of a competing business that would otherwise appear (for those who advertise; again contributing to a perception of “manipulation”)

The practices above are not uncommon or unique to Yelp. As one example, Google on its Place Pages shows “nearby places you might like,” which includes competitive businesses

But when you add all this to the fact that Yelp’s algorithm removes positive reviews in circumstances where the reviewers are suspect (i.e., they don’t have a track record on Yelp) you get a kind of perfect storm of frustration and confusion among some SMBs. That is now being expressed in these lawsuits in the form of “extortion” accusations. 

I can see how the aggressiveness of sales people and these other factors fuel a perception of “extortion.” However I believe the litigation will ultimately be unsuccessful as a legal matter.

The larger and more significant problem is the potential damage to Yelp’s reputation among SMBs and would-be advertisers who see many of their negative “suspicions” confirmed by the lawsuits. That’s the real challenge the site now faces.

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6 Responses to “Yelp’s Challenges on Display in NYT Comments”

  1. Marcus Keith Says:

    Yelp is not alone, among IYPs – of course we know that the big IYPs like DEX. Yellowpages.com, and Idearc have their own class-action and fraud challenges percolating, but based on our own experience and research we can expect more of these aimed at the newer “darlings” of local-directory review media – certainly AngiesList is getting close with very similar allegations brewing. Who’s next? Stay tuned!

  2. Adam Says:

    I am curious how removing certain questionable reviews could cause this perception among merchants. If the algorithm removes them when they are submitted, they would not appear in the first place, so merchants wouldn’t be aware of them. So either the algorithm allows all reviews to post, then reviews them (unlikely), or smething else must be causing this perception.

  3. Jeff @ Local.com Says:

    I think may what have really happened here is two fold:

    1) At some point, there were probably some bad sales folks on the floor at Yelp that probably claimed they could help out with things to get the sale;

    2) The review engine does work in fact the way that Greg (and Yelp) claims it does

    Tie those two things together and suddenly you have customers who think they’ve been screwed over by the machine.

    Unfortunately, I think Yelp is handling this a little poorly by just stating, “hey, it’s not us being bad, it’s the programming!” while they should have come out and said, “Hey, we found the bad apples on the sales force and fired them cold. We never actually messed with the reviews, that’s just the way the system works, but we can see how these poor employees could have started this confusion, please accept this lovely bag of oranges…” or something, I’m not in legal.

    The point is, they’re not helping things by putting themselves out there as the poor, picked on company that just has customers who just “don’t get it”.

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  6. Pato Says:

    Oh God the challenge goes much beyond the paid ads issue. It’s about Yelp suddenly in 2012 start furiously filtering 5 times the amount of good reviews than then they used to. It’s not my experience but too many to be ignored. You just go and look at each business. (coming from someone who’s been with yelp as a business since 2008). And then Yelp using this chance to call us, me included for paid advertising promising all those things mentioned on this site.

    But the focus is in Yelp’s change of filtering method to:
    Increase the filtering of the good ones, and allow the bad ones to go through. Do it for a semester and once the business is desperate offer advertising as a last resort. And if the declined, coincidently or not, as in my case you will get 5 out of 8 4+ reviews filtered. And none of the 2- ones filtered over a period of 6 months. We are all well aware of how latest reviews count so much more than older one.

    The key element here is that so far until 2011, although we all had honest reviews filtered, that wasn’t an issue so long as some truth of the business still remained. The case today is very different: Yelp’s new approach just simply transforms the image of any business into something that is not.

    As I imagine Yelp’s experts know that even if your score manages to stay high, reviewers won’t go to business, if your last six months show decline. Sadly, with 2012 yelps approach you could be actually doing 10 times better than all years before combined but you’ll show as mediocre with 3/4 of your good ads crossed out by yelp. So this radically change when don’t care to reply to business concerns, is unfair devastation for any business.

    Their algorithm story is just an excuse. Any business that has to cross out 80% of reviews on the basis that they can’t find a better system should not exist.

    Why not just implement a cross check system that can verify true purchasers before they post a review? This would automatically reduce the amount of censorship that Yelp claims has to do, when they take filtering to an outrages level? Not to mention that this would provide a true and reliable source of postings to the readers, which is unavailable today. Can we assume Yelp doesn’t have the technology, or is it that they don’t want to give away their power to play around more freely with business, and in so doing get a better chance at legal bribing?

    To know that the filtering is furthermore suggested to yelp by their users who are already unverified clients is what can I say a circus.

    In any case senario a ‘review’ site that needs to block the 80% of a business’ reviews based on claims of not finding a better solutions or ‘alogarithsms’, should be banned and sued for promoting intentional twisted information about businesses and the business’ clients point of view.

    Beyond any rumored bribing factor, the government should force yelp to allowed business owners to be removed from their site completely including removing any posts on your behalf from third parties.

    While a business is a public entity, no company such as Yelp should be allowed the right to use content posted by the public/clients in order to twist it to an extent that completely flips around the image of business. This happens when you filter more than 50% of reviews.

    There are other things that Yelp probably conveniently skipped from their system:

    1- prompt the reviewer to acknowledge ‘having contacted the seller prior to ‘claim'”

    2- Date of last purchase.

    Why is it that all serious businesses, such as the BBB, and credit cards ask for this?

    Well I just had a one star review from a client of 3 years ago, whom at the time completed the purchase, filled our feedback form giving exellent reviews, and then never write again with any concerns, or at all. Just irradically after all these years, this client came back o smash our business out of nowhere. mmm

    Is this yet another way in which Yelp’s ‘forgotten’ additions to their system, help encourage these type of highly phony/sent reviews, . To then reinforce the illusion of more need for Yelp’s sensorship.
    Oh did I mention? Of course this Elite Yelper’s review wasn’t filtered, the other 6 great ones were.

    And did I mention? The business had completely changed and thus the review no possibly farther from the truth. What dies it matter to Yelp, all the more reason why my business will go down and I might opt to .. What maybe pay their ad? No way, I actually paid to be removed from their ad, as ao many of us did.

    Did I contact the business before placing this? Of course, a trillion times. I just got their 2+ months delayed reply, consisting of a link to their FAQ page. Shame on you Yelp.

    Solution: please some geek pick it up.,create a trully unbiased and clean review site:

    1- Business sign up and keep their purchase records. Mainly otder number and client’s email.

    2- Reviewers sign up, and have to do nothing different than they already do at yelp. Only enjoy knowing that all reviews are from true customers, and that filtering both ways will be reduced to a normal levels.

    3- system cross checks reviewers email addresse/s before allowing for a post. Then checks for having contacted the business. Anyone can lie, of course, but what matters is to reduces rather than encourage the amount of intoxicating rants and raves or random expressions of psychologycal trouble that resets at Yelp have to read through before getting to an actual constructive review. (or at least those to whom time is of the essence)

    4- Then the system stamps the date of purchase AND through a simple alogarithm, post the reviewers activity level at the business, based on purchase amount or times. Just like Yelp does for their users. Mostly readers can see if the 5 or 1 star review came from a $1 cookie meal or a $100 dinner. And that it couldn’t be bluffed.

    And the rest up to whoever hopefully develops this at least proven true reviewers site.

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