Yelp, the go-to review site for consumers, is home to 90 million reviews. Consumers flock to Yelp before trying out a new boutique, service, or restaurant. And according to a Nielsen study, 4 out of 5 people who visit Yelp intend to make a purchase, which has helped a lot of businesses get found and make money.
Yelp has become more than a review site, it’s a discovery tool that leads consumers directly to new businesses.
While Yelp, whose motto is “real people and real reviews,” benefits businesses large and small, the site still receives major backlash from real business owners. In fact, The Wall Street Journal reported that the FTC received more than 2,000 complaints about Yelp from 2008 through March 2014. Why? Let’s explore this more:
You may be familiar with how Yelp works, but here’s a refresher for context:
After visiting any business, customers can rate their experience and leave their comments on Yelp. Businesses are given a star rating of one to five, one being the lowest. Once a review is written, it’s public and open for everyone to read.
In theory, good businesses get good reviews and see an increase in business because of it, while bad businesses get poor ratings and patrons avoid it. But it’s not that black and white, making things complicated, particularly amongst small business owners.
So what are the biggest beefs businesses have when it comes to Yelp, and are they justified? Here’s what we found:
Complication #1: Yelp filters reviews
Yelp uses an algorithm to remove false reviews and/or reviews that seem too good to be true. After all, rosy reviews may be the result of business owners posting their own positive reviews, or having friends and family do so. In an effort to supply real, honest reviews, Yelp filters some comments left by customers.
The company says, “the best word of mouth is organic and unsolicited,” which is what the algorithm works to showcase.
But, algorithms aren’t perfect. The filter has been known to remove real, positive reviews left by actual customers. Yelp’s aware of this issue, as they mentioned on their blog:
“Reviews that reflect perfectly legitimate experiences are sometimes filtered out by the review filter’s algorithmic processes. We agree this can be frustrating, but it’s the high cost we accept to avoid being a lassez-faire review site that people stop using.”
What exactly factors into the removal of some genuine reviews? According to LocalVox, these are common reasons:
- The reviewer has only written one review.
- The reviewer doesn’t have profile information, such as a photo, a link to Facebook, etc.
- Words used in the review are extremely positive or negative.
- The review is short and lacks details.
- The reviewer is located far from the actual location of the reviewed business.
While this is a pain point for some, 67% of businesses on Yelp still have a four or five star rating, and glowing reviews to go with them.
It’s also not just Yelp causing review issues. Businesses have also encountered issues with the review filters used by Google+ Local, TripAdvisor.com, and others. (Angie’s List, an online subscription business review site, does not use such filters.)
Complication #2: It’s difficult to get Yelp to remove a false review
If a Yelper leaves a review that’s filled with false accusations, a small business owner can report it to Yelp, but it’s unlikely that Yelp will take it down. On Yelp’s support center, it provides a link to report “questionable reviews” but goes on to say, “We typically don’t take sides in factual disputes and generally allow Yelpers to stand behind their reviews.”
Statistics show 72% of consumers trust Yelp as much as personal recommendations, according to research from Merchant Warehouse. With such a hefty influence, businesses want more control over their online reputations.
Rather than have the ad removed, business owners can respond to the comment in a professional manner in an effort to better represent their brand. If handled properly, cranky Yelpers can turn into repeat customers.
Complication #3: Yelp’s sales tactics are called into question
Small businesses can advertise on Yelp, for a fee, of course. However, some small businesses allege the company extorts owners by promising to hide negative reviews in exchange for advertising dollars.
The headline of a recent Business Insider article reads, “Yelp is continuously battling extortion claims.” In fact, Yelp has faced several class action lawsuits because of these claims, but judges have dismissed the cases, according to the news source.
During one of the lawsuits, a lawyer likened Yelp to the modern-day Mafia offering online reputation protection for a fee, according to Business Insider.
Yelp denies the extortion claims, posting an article on its blog that says extortion claims are not, and never have been, true. The post goes on to point out that research has debunked this myth and points to the number of times that courts have rejected the claims.
While the whole ordeal has led to some bad PR, it hasn’t stopped businesses from advertising and reaping benefits with the site. Research suggests that Yelp is a powerful advertising tool. Consider this: As we’d mentioned above, 82% of consumers using Yelp intend to make a purchase and 89% of those who buy do so within a week.
Even Harvard has validated Yelp’s advertising potential. A small business that can boost its star rating by one star can see an increase in revenue of 5 to 9%, according to a Harvard study.
While the reasons listed above explain why a number of businesses strongly dislike Yelp, there are businesses that appreciate the site. In the eleven years since Yelp started, the site has amassed quite a following. The site has 142 million unique monthly visitors, which gives the site a lot of clout with consumers and businesses. Still, opinions vary when it comes to Yelp.
As a small business owner, how do you feel about Yelp? Share your thoughts in the comment section below.