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The Yelp Drama Continues

yelp dramaI’ve written several times about Yelp – a San Francisco based website that collects and publishes reviews about local small businesses in many cities across the country.  Naturally, restaurants are one of the most commonly reviewed businesses on the site.

Over the past year a steady grumbling has risen about the way in which Yelp pursues advertising revenue – by calling small business owners and offering some small review manipulations in exchange for a $300 – $1,000 monthly fee.  That grumbling arrived at a crescendo last month when several businesses filed a class action lawsuit accusing the company of extortion.

For their part, Yelp has always maintained they do not manipulate reviews and that they are simply trying to provide a service to consumers and an advertising channel to businesses.  Yet two factors have left the majority of business owners suspicious: the fact that businesses who pay the monthly fee get to pick the top review on their company’s Yelp profile, and the murky process the site uses to filter reviews (many have long been suspicious that advertisers get preferential treatment).

Last week Yelp decided to address these two primary concerns with an important announcement.  First, advertisers will no longer be able to choose their top review.  Second, Yelp is throwing open the door and shining some light on the process they use to decide which reviews get deleted, which ones stay, and how the site decides to rank them.

Yelp’s leadership remains confident these measures will exonerate the company from the myriad “conspiracy theories” with which they feel the public has victimized them.

Yet as far as I can tell, Yelp’s practice of using hard sell tactics (calling up business owners and pressuring them to become advertisers) will remain.  As I wrote in February, the trouble with Yelp is not their murky review ranking process, their hard-charging salesmen, or their preferential treatment of paying advertisers.

The real problem is the inherent negative motivation the company’s business plan creates: pay Yelp to get people to stop saying bad things about you on Yelp.

No one likes how that feels.  And I imagine Yelp’s public relations problems will continue unless they change this basic truth about their approach to online reviews.

About Greg McGuire

Greg has blogged about the food service industry for years and has been published in industry magazines, like Independent Restaurateur and industry blogs like Restaurant SmartBrief. He lives in Colorado with his wife and two sons and enjoys reading, live music, and the great outdoors.

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