Yelp is Fucked

Too many allegations of manipulation: I’d be surprised if they survived the year without substantial changes to their business model. Too much controversy: I know I would never look at a Yelp review on my iPhone without wondering if it wasn’t paid for. Until Yelp address this article directly, and credibly, they will not be trusted again. I know I’ve deleted their application off of my iPhone.

Monica Eng investigated the local Chicago variation of the story:

With the Web site Yelp still responding to allegations by San Francisco businesses that it manipulates the prominence of positive and negative reviews, some Chicago merchants are adding to the heat.

They allege that Yelp representatives have offered to rearrange positive and negative reviews for companies that advertise on the site or sponsor Yelp Elite parties.

Ina Pinkney of Ina’s restaurant in the West Loop said that last summer a Yelp salesperson offered to “move up my good reviews if I sponsored one of their events. They called it rearranging my reviews.”

The owner of More Cupcakes, Patty Rothman, said that last fall a Yelp Chicago staffer walked into her Gold Coast shop and “guaranteed us good reviews on the site if we catered one of their parties for free.” Offended but resigned, Rothman complied. And just as promised, positive reviews bloomed for the business right after the party, Rothman said.

Other Chicago businesses told the Tribune of similar experiences but asked to remain anonymous.

Since the allegations were first reported in a San Francisco alternative weekly in mid-February, Yelp’s CEO Jeremy Stoppelman has been taking his side of the story in this controversy to the Web, the media and even Twitter.

[Click to read more of Chicago proprietors add to Yelp allegations — chicagotribune.com]

In other words, standard operating procedure. Pay for good reviews to be at the top, or else, your business will suffer. A Yelp mafia. “You wouldn’t want your pretty place to be messed up, would you?!”

Kathleen Richards of the East Bay Express started all the hair-shirtery:

During interviews with dozens of business owners over a span of several months, six people told this newspaper that Yelp sales representatives promised to move or remove negative reviews if their business would advertise. In another six instances, positive reviews disappeared — or negative ones appeared — after owners declined to advertise.

Because they were often asked to advertise soon after receiving negative reviews, many of these business owners believe Yelp employees use such reviews as sales leads. Several, including John, even suspect Yelp employees of writing them. Indeed, Yelp does pay some employees to write reviews of businesses that are solicited for advertising. And in at least one documented instance, a business owner who refused to advertise subsequently received a negative review from a Yelp employee.

Many business owners, like John, feel so threatened by Yelp’s power to harm their business that they declined to be interviewed unless their identities were concealed. (John is not the restaurant owner’s real name.) Several business owners likened Yelp to the Mafia, and one said she feared its retaliation. “Every time I had a sales person call me and I said, ‘Sorry, it doesn’t make sense for me to do this,’ … then all of a sudden reviews start disappearing.” To these mom-and-pop business owners, Yelp’s sales tactics are coercive, unethical, and, possibly, illegal.

“That’s the biggest scam in the Bay Area,” John said. “It totally felt like a blackmail deal. I think they’re doing anything to make a sale.”

[Click to read more: East Bay Express | News | Yelp and the Business of Extortion 2.0]

I wonder if my review of Sepia was buried for this exact reason [my Yelp review]. If you peruse Yelp’s page for Sepia, most reviews on the front page are raves, not the negative reviews like mine, and so many others.

The New York Times was interested too:

Local news outlets have raised questions about the company’s practices, including a recent article in the East Bay Express, an alternative weekly, with the provocative headline: “Yelp and the Business of Extortion 2.0.” It reported that Yelp sales representatives had promised to move or remove negative reviews for advertisers.

Mr. Stoppelman said that Yelp does not move negative reviews for advertisers and applies the same ranking system to all companies on the site. Many advertisers, including Mr. Picataggio of Tart restaurant, have negative reviews.

Some of the confusion may come from the fact that advertisers, who pay $300 to $1,000 a month, are allowed to choose which review shows up at the top of their profile page and block ads from competitors. For other businesses, the first two listings a reader sees could be an ad for a competitor and a one-star review.

“If there’s no clarity about that process at all, it exacerbates the suspicion,” said Eric Goldman, a professor at Santa Clara University School of Law and the former general counsel of Epinions, another review site.

Yelp’s lack of transparency does not affect its relationship with businesses alone. It also risks eroding users’ trust in the site. Eric Kingery, an engineer and frequent Yelp user in Chicago, discovered that a review he had written of a jeweler disappeared. “It just makes me suspicious of the impartiality,” he said. “It is a very useful service, but this kind of harms the integrity of the site.”

[Click to read more of Review Site Draws Grumbles From Merchants and Users – NYTimes.com]

Like I said, would be surprised if Yelp survives all this negativity without substantial changes to their methodology and business practices.