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Yelp Extortion Allegations Stack Up (March 2009)

147 points| TrevorBramble | 16 years ago |eastbayexpress.com | reply

78 comments

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[+] zzzmarcus|16 years ago|reply
I stopped using Yelp and uninstalled it from my iPhone when I read the article last year.

Yelp's business model doesn't sit well with me. Even if the allegations of good reviews disappearing for businesses who don't pay up aren't true, the idea that there is a service out there that you don't want but you're almost forced into paying for since it's affecting your business directly feels to me like paying the mafia to 'protect' your business.

If Yelp really does want to help both businesses and consumers, give businesses the ability to respond to reviews for free and don't artificially alter results, be like Google and let your algorithm work. Make money selling ads.

It reminds me of the whole GetSatisfaction drama with 37 Signals from a few months ago (http://news.ycombinator.com/item?id=540540). This type of business model where you provide a business a "service" they didn't ask for then try to charge them for it will never go over well.

[Edit] FWIW this page, found below in relme's comment (http://www.yelp.com/myths) directly answers every one of my concerns with Yelp. If it's true then great, sounds like they're doing things well. I find it hard to write off all the complaints as fictional though.

[+] newhouseb|16 years ago|reply
> "give businesses the ability to respond to reviews for free and "

Yelp has had the ability for businesses to respond publicly or privately to a review for almost a year now I believe.

> "don't artificially alter results, be like Google and let your algorithm work."

The same game happens in the web search world - it's called SEO. Yelp's spam algorithm is decoupled from any advertising, yet since business owners don't write their own reviews, they have less control over their reputation (as opposed to webmasters who change their page content), and are much more likely to come up with conspiracy theories as to why things happen the way they do and consequently often get very frustrated.

[+] chaosprophet|16 years ago|reply
So are there any similar services which do offer business owners a chance to respond for free? If not, wouldn't this be a good opportunity for a startup? You could probably advertise yourself as the 'dont-be-evil' version of yelp.
[+] poutine|16 years ago|reply
I seriously doubt good reviews would just disappear. The reviewer would complain. I'm a Yelp Elite in my city and I'd scream murder if any of my reviews disappeared.
[+] city41|16 years ago|reply
The fact that myths page even exists at all, with 9 rather damning myths, is enough of a red flag.
[+] timcederman|16 years ago|reply
My wife and I both recently posted negative reviews at businesses that were advertising with Yelp. Neither review (which were both fair and truthful) ever showed up on site.

edit: Just to clarify, I spoke to Yelp about it. The reply I got was "[The] spam algorithm can filter based on how established user is. [Your post was] not deleted & can re-appear on biz page. Still live on your profile."

[+] brandnewlow|16 years ago|reply
The small business owners I know in Chicago say Yelp calls them incessantly, offering to let them take over their profile pages for $500/month (don't quote me on that price).

Their biggest issue with Yelp is that they tell their customers to go review them on Yelp. The customers do. Then Yelp deletes the reviews because the people who posted them weren't "true Yelpers." So only reviews from people who post lots of reviews are valid? WTF.

[+] wushupork|16 years ago|reply
That's basically what happened to us. We had all our customers Yelp about us, many who haven't even heard of Yelp. Then they took them all down because those people only wrote one review, basically for us.
[+] barrkel|16 years ago|reply
Sounds like Wikipedia edits.
[+] dmgrossman|16 years ago|reply
Sales operations where you need many customers, each consisting of low price point "buys" typically require a large salesforce of relatively low-paid junior people who make most of their money on commission (similar to classified sales at newspapers). Basically a boiler room style operation where people "dial for dollars" all day. It's not a surprise that some sales people may have attempted these tactics without management's knowledge or approval.
[+] diego_moita|16 years ago|reply
It may valid, but it doesn't exonerate the business (yelp, in this case) from responsability.

I think the real troubling issue is that they demand openess from other businesses but don't show their algorithms or give open access on their pages for response.

I wonder how long it will take for businesses to start using Mechanical Turk against this Yelp.

[+] madh|16 years ago|reply
Absolutely correct.
[+] JCThoughtscream|16 years ago|reply
It is actually fairly plausible that Stoppelmann has no idea at all that his sales representatives are using such shady tactics.

That is not, however, good news for Stoppelmann. Not in any sense. It would indicate that, at the client-business level of interaction, there is no functional oversight at all. That Yelp's management's either willing to turn a blind eye, or are so negligent as to allow this to occur even in the face of growing criticisms.

Incompetence or malevolence; either way, they're in trouble.

[+] Tangurena|16 years ago|reply
Since Yelp depends on sponsorships to turn a profit (trick question: have they turned a profit yet?), they depend on the sleazy tactics of their sales reps. I'm reminded of a line from the opening of Mission Impossible: As usual, should you or any member of your I.M. Force be captured or killed, the secretary will disavow any knowledge of your existence.

Any advanced incompetence is indistinguishable from malevolence.

[+] gphil|16 years ago|reply
> It is actually fairly plausible that Stoppelmann has no idea at all that his sales representatives are using such shady tactics.

I kind of buy this--I've been told that the sales reps at Yelp are paid by commission, which can lead to this sort of thing.

[+] wonlove|16 years ago|reply
or it could just not be true
[+] aaronblohowiak|16 years ago|reply
This is actually racketeering and not extortion.
[+] elai|16 years ago|reply
A racket is an illegal business operation. Extortion is coercing money out of a party under threat of blackmail (which yelp is doing), violence or some other negative action done on the extorted.
[+] qeorge|16 years ago|reply
Actually, I think it qualifies as both.
[+] bobbyi|16 years ago|reply
Can you explain why this doesn't quality as extortion?
[+] wushupork|16 years ago|reply
We had a similar issue over at Extreme Kung Fu where I teach out of. A Yelp rep called (this was maybe a year or year and a half ago) and same thing: We notice you have a lot of positive reviews and we drive a lot of traffic to your site. The implication of the conversation was that if we wanted to stay that way, we better sign up as a sponsor.

I even wrote a blog post about it, and that got picked up when the whole Yelp thing blew up last year. I used to recommend Yelp to everyone, now I feel dirty even talking about it.

[+] BigDamnDeal|16 years ago|reply
This is why I want Foursquare to start handling reviews. (Foursquare lets people "check in" at a bar, restaurant, or other venue and notify friends.)

Foursquare's developers say they're working on winnowing out false checkins with GPS, which should give them a good idea of where their users are actually going, and when. I'd trust reviews written on the spot more already.

I'd also trust reviews from my friends. And since Foursquare is a social network first, I've built an actual collection of real-world friends, not a network of people I only know through a web site. These are people who largely share my taste in venues.

It's obvious that a lot of people want an alternative to Yelp. I'd try out others, but I particularly want one that verifies reviewers were actually there, and one that pays attention to what I already like and my friends like.

I want a Pandora for places.

[+] teye|16 years ago|reply
Bad reviews -> self/friend posted shill review -> shill reviews removed -> "Yelp removes my 5-star reviews!"

I'd expect a little exaggeration from the frustrated party, and these conversations sound like they're just barely more than benign. I'll have to ask my friend in Yelp ad sales how pushy they get.

[+] michaelcampbell|16 years ago|reply
Because someone in ad sales would tell you the truth about business practices from which he derives a living.
[+] DenisM|16 years ago|reply
By the same token: note enough ad revenue -> promise removing bad reviews in exchange for buying ads.

So why did you chose one narrative instead of the other?

[+] gursikh|16 years ago|reply
There probably isn't a single business owner out there that feels comfortable with the existence of an online directory where disgruntled customers can collate and publish their opinions. I'm sure a good deal of them are willing to lie to rid themselves of the nuisance. Just because Yelp is creates a large headache for lazy business owners doesn't mean it's evil. It's creating an environment where business strive to provide quality service. It does so by creating incentives for doing so (good reviews) and disincentives for failing to do so (bad reviews).

There are no facts in this article. Just allegations.

[+] pyre|16 years ago|reply
There are also incentives to disgruntled employees (for example) to publish bad reviews to 'get back' at the business. In general, services like this are only useful once they reach a critical mass so that the signal drowns the noise. But as you grow you also become the target of spammers (i.e. Google's problems with SEO, real estate scammers, link farms, etc).
[+] RyanMcGreal|16 years ago|reply
> As you have undoubtedly noticed, we've been doing some shuffling around here, and the page you're looking for seems to have gone missing.

Bad web designers, bad! There's no excuse not to ensure that old URLs return HTTP 301 redirects to the new URLs.

[+] alttab|16 years ago|reply
I don't remember who it was or what their business was called , but someone else got called out for something similar. It was under the guise of brand management as the site aggregated social media, blogs, etc about what people were saying about a company on the Internet then charging business owners to make replies.

It came down to brands being held hostage and the story that broke was very similar. I wish I could remember the guy. I remember his blog posts sounding very proud though.

As far as yelp goes, Its probably only the sales or a small portion of the operation (maybe). I have a friend that works at yelp and I'd be dissapointed if he stayed there knowing this was going on.

[+] motters|16 years ago|reply
Before reading this I'd never heard of Yelp. It sounds like a good example of antisocial networking, of which we might see more examples in future.
[+] pyre|16 years ago|reply
You've probably seen Yelp stickers in business windows before but overlooked them. I've seen them around, but I can only recall instances of businesses in Portland or Toronto. I can remember specifically if I've seen them in other places, but probably so.
[+] acgourley|16 years ago|reply
I was expecting to see something damning but this looks like what yelp has been admitting to do for a while now.
[+] brown9-2|16 years ago|reply
They admit to letting you sort your negative reviews to the bottom if you advertise? Or to restore five-star reviews which were "flagged as spam" if you advertise?

Do you have a citation for this? I don't mean to call you out but I have no idea what yelp has admitted to.

[+] unknown|16 years ago|reply

[deleted]

[+] brown9-2|16 years ago|reply
The article being linked to in this HN discussion is actually a response to the CEO's response (which you've linked to).
[+] dzlobin|16 years ago|reply
Now..two things. 1. Can anyone comment on the legality of this internet based extortion as opposed to "regular" extortion?

2. Is this by any chance the reason why the Google deal fell through? I know we heard otherwise but it makes me wonder.

[+] marcusbooster|16 years ago|reply
I would think with that many reviews the potential for libel is a concern.