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If you are not an unhappy business owner listed on Yelp, or a frustrated reviewer who has had legitimate reviews filtered (hidden from view and not factored into a business' ratings) you probably have never used Yelp for anything other than to research businesses.
Yelp works like this: they publish business information (which business owners cannot remove) and invite people to review the business. Reviews, at the sole discretion of Yelp (robots - no humans involved) then decide whether a review is fake (filtered) or legitimate (published.)
The use of algorithms to detect "fake" reviews has been the subject of conversation in forums, on blogs, the media, and even in the court room.
The Class Action Extortion Lawsuit Against Yelp
In 2010, two plaintiff's law firms filed a class action lawsuit in Los Angeles federal court alleging unfair business practices by Yelp. Yelp was accused of Digital Racketeering, specifically, manipulating Yelp profiles to show more negative reviews, then attempting to extort business owners to have them removed or filtered.
According to TechCrunch.com, "The plaintiff in the suit, a veterinary hospital in Long Beach, CA, is said to have requested that Yelp remove a negative review from the website, which was allegedly refused by the San Francisco startup, after which its sales representatives repeatedly contacted the hospital demanding payments of roughly $300 per month in exchange for hiding or deleting the review."
The lawsuit was initially dismissed in April 2011, but the plaintiff's were given a second chance to present their case, which was dismissed "with prejudice" for a second time in October 2011.
Although Yelp was not found guilty of any unfair business practices, PCWorld.com, noted that Yelp did change at least one questionable practice (which, Yelp maintained was an acceptable business practice) after the lawsuit was filled: "At the time of the lawsuit, Yelp did have a program that allowed a business to place a favorable review at the top of their Yelp page if it bought advertising with Yelp. Just as Google tags certain links at the top of a page of search results as "sponsored links," Yelp labeled the positive review chosen by the merchant as a "sponsored review." About two months after the lawsuit was filed, Yelp canned the sponsored review policy."
Another change? After the lawsuit was filed Yelp started allowing access to those filtered reviews that prior just went missing.
Yelp's Latest Practices Will Further Disadvantage Business Owners
Business owners still cannot opt out, there is no appeals process, and business owners with an issue are more likely than not to be offering (expensive) advertising services on Yelp. So, what is Yelp doing today to improve its reputation and fairness in its treatment of business owners?
I hate to be the bearer of bad news, but the latest Yelp tactic is to now filter reviews when too many come from one IP address. But why just filter more reviews, why stop there?
Yelp believes the practice of businesses paying people to post fake reviews is such a problem that all business owners must now be subject to yet another crack down:
"In an attempt to put a stop to these fraudulent reviews, Yelp has announced a new 'Customer Alert' system. A warning message will appear on business pages when Yelp believes that a company has paid for its reviews. One indicator that a business is engaging in this type of activity is if it has a large number of reviews submitted from the same Internet Protocol (IP) address, Yelp says." Source: Entrepreneur.com, Jason Fell, Yelp to Business Owners: Don't Try to Game Our System.
There are huge problems for business owners with this new approach. First, because the majority of filtered reviews are positive, the latest method of "gaming" Yelp is to post negative reviews on competitor's pages. Because negative reviews are far less likely to be filtered, fake bad reviews can bring down another business, making yours look better by default. To my knowledge, Yelp is not even acknowledge this as an issue at this point. Second, there are six people living in our household -- if we all add reviews on Yelp, under the new IP address protocol none of our reviews will matter -- or worse, if we all wanted to review the same pizza place that business could be slapped with a "Customer" alert.
Yelp is not disclosing what constitutes a "large number."