"Extortion 2.0" , page 1

Most of us use the internet all of the time to source local businesses or to plan a trip and most of us also realize that it’s “user beware” as far as the accuracy of information available to us. But although I understand the basic concepts behind generated content and on-line reputation management, it just never occurred to me that people would combine them in such a way as to prey on businesses in order to make money off of them.

I suppose I was being very naive because it is the oldest racket around.

www.eastbayexpress.com...

Local business owners say Yelp offers to hide negative customer reviews of their businesses on its web site ... for a price.

The phone calls came almost daily. It started to get creepy.

"Hi, this is Mike from Yelp," the voice would say. "You've had three hundred visitors to your site this month. You've had a really good response. But you have a few bad ones at the top. I could do something about those."

This wasn't your average sales pitch. At least, not the kind that John, an East Bay restaurateur, was used to. He was familiar with Yelp.com, the popular San Francisco-based web site in which any person can write a review about nearly any business. John's restaurant has more than one hundred reviews, and averages a healthy 3.5-star rating. But when John asked Mike what he could do about his bad reviews, he recalls the sales rep responding: "We can move them. Well, for $299 a month." John couldn't believe what the guy was offering. It seemed wrong.

In fact, something seemed shady about the state of his restaurant's negative reviews. "When you do get a call from Yelp, and you go to the site, it looks like they have been moved," John said. "You don't know if they happen to be at the top legitimately or if the rep moved them to the top. You don't even know if this is someone who legitimately doesn't like your restaurant... Almost all the time when they call you, the bad ones will be at the top."

…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."

Yelp officials deny that they move negative reviews, although such allegations have surfaced many times before. The issue is even addressed on the web site's Frequently Asked Questions page. Chief Operating Officer Geoff Donaker said advertisers and sales representatives don't have the ability to move or remove negative reviews. "We wouldn't be in business very long if we started duping customers," he said.

But Donaker's denials are challenged by nine local business owners and also by a former contract employee who worked with Yelp in its early days. That person, who is still close to some Yelp employees and only agreed to be interviewed if granted anonymity, said several sales reps have told him they promised to move reviews to get businesses to advertise. "It's not illegal or unethical," he said they told him. "We're just helping the little guy. It doesn't hurt them, it benefits them."

Such tactics may be legal, but they clearly raise ethical concerns. Yelp touts its web site as consisting of "real people" writing "real reviews." The allegations of business owners who have tangled with the company suggest otherwise...

…Business owners are also disturbed that some negative reviews are written by paid Yelp employees. When the company first launched in 2004, its staff wrote many reviews on the site. And to this day, Yelp hires "Scouts" or "Ambassadors" to write reviews — especially when they enter new markets. CEO Stoppelman himself has written nearly eight hundred reviews.

So they write many of the "reviews", offer to manipulate which reviews are most visible - for a price - and your number of negative reviews often seems correlated to your site sponsorship status?

Sounds like the digital version of a protection racket. To me, it seems most ethical to post the reviews "as is" - good or bad - in chronological order.

[edit on 28/1/2010 by kosmicjack]