Do Small Businesses Really Hate Yelp? Why It’s So Complicated…

Do Small Businesses Really Hate Yelp?

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:

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Yelp 101

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.

Wrap up

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.

Lisa Furgison
About the Author
Lisa Furgison

Lisa is a writer at Fivestars, a freelance journalist, and co-owner of a media company, McEwen's Media.

10 Comments

  • Let’s talk algorithm. Each day more and more people learn about the so called unbiased filtering system yelp uses to dictate what reviews are considered to be an honest consumer experience. My site,I have 104 reviews 22 that are recommended and create my star rating which is at this time 3.5. The other 82 are hidden in the “not recommended “section and are not factored in my company’s rating. Out of that 82, 76 are 4/5 star reviews. That’s quite a few 4/5 reviews withheld from a mere 82 reviews. Now let’s see how this magic filter reacts to reviews about yelp. Yelp has received over 16000 reviews. 7840 recommended,7193 not recommended and over 2000 in violation of their guidelines. Now I didn’t have enough time to waste pouring through over 9000 hidden reviews but in the over 3,000 I saw there wasn’t one 5,4, or even a 3 star review that was hidden. So my question is how this ol mighty filter of truth can find so many 4/5 star reviews that get placed in the not recommend in less than 100 reviews for me and 1,000’s of other businesses and yet can’t find 1 in the many 1,000’s of yelps own reviews?  And what other company has had over 10,000 people write how much they hate them on one website? 

  • Yelp uses ip addesses in other parts of the city to click on paid ads. Lawsuit was thrown out i have proof though. Never pay them for anything. In fact just bash them at every chance you get. Not a real review site at all.

  • Ruthless and mean comments can destroy a business. And we all know that you don’t go into business to give bad customer service right?? It’s not fair that a business can’t just put it’s best foot forward anymore and not have to worry about all of the fake reviews or mean comments anymore….OH WAIT! They can!

    This is why we made Finalee and, let’s be honest, it’s going to piss a lot of big companies off. Look at our project and support our movement!

    https://igg.me/at/finalee

  • Yelp is HORRIBLE!! They are the modern day mafia and that is NOT an exaggeration. In fact they might be worse by the way they are killing businesses all around this country due to their “highly sophisticated” review filter. I currently have 21 (5) star reviews all happy PAYING customers and all of them are sitting in the not recommended review category. BS!

    When I call to complain I end up losing more (5) star reviews from the reviews that are actually showing and now I have (3) 1 Star reviews that show up (2) of which never used my service and (1) who tried to swindle me. I essentially have NO bad reviews for my business but I have a 2.5 star rating on Yelp. It’s toral garbage. No one should trust Yelp business owners nor consumers

  • Yelp is horrible! Look at a negative review and that person has listed only negatives! This is the place jerks go to whine about anything – true or not! I had a customer who lied and contacted both he and yelp to get it resolved. Yelp will always go with the user,,,,unless they can extort a company to pay them a membership fee. This is what I call extortion !!!

  • I saw a news story where yelp complained google ignored them – Good. Yelp’s only existence is to destroy businesses with their fake site!! Wish, as a group, we could file a class action suit to stop them.
    We have 13 positive reviews placed in the not-recommended area. We have two new very new great reviews we can expect Yelp to remove shortly. And, we have three horrible reviews that are very old. Everyone of them is a blatant lie. We have an upscale shop – the reviewer said it was “back door” and shady. We have the best product in town- the reviewer said it was full of chemicals- all products are lab tested, chemicals would have been found and reported to the State before they reached our shop.
    Called Yelp and got the run around. Offered to pay them to put the good reviews back and they were horrified and said they do not accept payment. I don’t believe that – maybe it’s the way I presented it.

  • I have legitimate positive reviews from clients who have photos and Yelp friends and have written reviews for other people but Yelp kept hiding and moving these reviews to the “not recommended” section.
    Considering the time and thoughts my clients have put in to writing reviews on Yelp to find out that their reviews are hidden , this is so unfair and discouraging to continue to use Yelp. I also have clients from other cities or countries that travel all the way to use my services. The algorithm that filters out people who not local are not in the area of service is unfair. I also have clients who don’t use yelp or don’t like Yelp however are willing to sign up to write me Yelp reviews. Considering my business has helped Yelp gain new customers I think Yelp should really find better way to do business and find a more accurate and more fair algorithm.

  • I have legitimate positive reviews from clients who have photos and Yelp friends and have written reviews for other people but Yelp kept hiding and moving these reviews to the “not recommended” section.
    Considering the time and thoughts my clients have put in to writing reviews on Yelp to find out that their reviews are hidden , this is so unfair and discouraging to continue to use Yelp. I also have clients from other cities or countries that travel all the way to use my services. The algorithm that filters out people who are not local are not in the area of service is unfair. I also have clients who don’t use yelp or don’t like Yelp however are willing to sign up to write me Yelp reviews. Considering my business has helped Yelp gain new customers I think Yelp should really find better way to do business and find a more accurate and more fair algorithm. I also have a client who found me through Yelp and went to post a positive review on Yelp but the review got hidden . Just because someone is using Yelp but doesn’t have Yelp friend doesn’t mean the Review is not legitimate. The Algorithm needs to change otherwise people are migrating to use other review Platform.

  • I will not pay to boost my business through yELP. They have call me 4-5 times throughout my first year of business. At first I was not ready to invest in the program. Once I was starting to consider signing on with yelp I started to notice my 5 star reviews were being hidden by the so called filter. Yelp reps continued to call me telling me that I needed to sign on with them in order to drive more traffic to my business. They called to the point of being overly aggressive and insulting my attempts to put them off. At this point all of my reviews have been archived. Even one from an “Elite Yelp Reviewer”. Frankly, I don’t trust the company anymore. I’m not investing my advertising dollars with them to get more great reviews only to have them filter them all out once I stop advertising through them. So presently I’m using Facebook and Google to attract more business. And people are finding me through them. Does yELP realize they have a 19% loss in shares from small businesses revolting? Or do they even care?

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