8 ms·

Yelp Extortion Allegations Stack Up (March 2009)

• dzlobin 17y ago
  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.
• spolsky 17y ago
  old news ... march '09
  • TrevorBramble 17y ago
    Hi, Joel. I updated the title. Maybe because I only recently moved to an area where Yelp has a presence, but I hadn't noticed this article until today.
    • physcab 17y ago
      I hadn't heard of this before, so thanks for posting.
  • TrevorJ 17y ago
    Do you have any sources for updated info on this situation? I'm curious to see how it has played out.
    • azsromej 17y ago
      I just posted Inc's article on how Yelp can make or break local businesses (this month's article). http://news.ycombinator.com/item?id=1062641 http://news.ycombinator.com/item?id=1062641
  • dotBen 17y ago
    Yes, I'm unclear as to why this story is considered "relevant". There are many startups that have skeletons in the cupboard like Yelp allegedly does
• teye 17y ago
  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 17y ago
    Because someone in ad sales would tell you the truth about business practices from which he derives a living.
    • teye 17y ago
      She has no reason to do otherwise with me. Our definitions of "friend" may differ.
      • pyre 17y ago
        Well, she may feel dirty about what she does and be concealing it from everyone. It's not like people have never lied about things to family before, let alone friends.
      • michaelcampbell 17y ago
        Other than possibly being fired if found out. Perhaps our definitions of "no reason" also differ.
  • DenisM 17y ago
    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?
    • deleted 17y ago
      [deleted]
    • teye 17y ago
• aaronblohowiak 17y ago
  This is actually racketeering and not extortion.
  • qeorge 17y ago
    Actually, I think it qualifies as both.
  • bobbyi 17y ago
    Can you explain why this doesn't quality as extortion?
    • aaronblohowiak 17y ago
      To some people, racketeering is a subset of extortion. To me, extortion is the simple extraction of money by coercion. Racketeering involves the protection from both the racketeer but also from other aggressors. The Yelp model fits this nearly exactly, whereas extortion is a much broader term. From the wikipedia article on protection racket: >In some cases, the "protection" is little more than extortion, with no real service rendered unto the victim. Otherwise, the racketeers will warn other criminals that the client is under their protection and that they will punish anyone who harms the client. Services that the racketeers may offer may include the recovery of stolen property or punishing vandals. The racketeers may even advance the interests of the client, such as muscling out unprotected competitors.
  • elai 17y ago
    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.
• acgourley 17y ago
  I was expecting to see something damning but this looks like what yelp has been admitting to do for a while now.
  • brown9-2 17y ago
    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.
    • cnunciato 17y ago
      And even if they did admit to it, that seems about as "damning" as it gets for a site whose value proposition is based almost entirely on its credibility.
      • nickpleis 17y ago
        I don't think that's even Yelps primary value proposition. They're much more of a social network than anything else. Their proposition seems to be more around providing a place for people to gain recognition for their taste. This is why they have the elite yelper program and what-not. The result of that play is a huge site with a TON of reviews that create a lot of organic SEO traffic. The credibility of those reviews, while important, isn't really their upmost concern. That's why withholding positive reviews (under the guise of spam control) is effective. They're effectively extorting you to create more content for them. Is it intentionally designed that way? I have no idea, but I bet it's extremely effective.
• brandnewlow 17y ago
  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 17y ago
    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.
    • pyre 17y ago
      No offense, but that does tread into dicey territory. It comes rather close to businesses offering customers discounts for positive Yelp reviews. How do you draw the distinction? If there is no distinction how can you be sure that Yelp reviews are true?
      • chubbard 17y ago
        But, is it any more dicey that only accepting reviews from a small population of yelpers that are more loyal to yelp than to the business they review? Think of it this way a yelper whose never heard of your business vs. many loyal customers who've never heard of yelp. To some degree it turns into a yelps loyal customers vs. a business' loyal customers and yelp with always side with their loyal customers on it. Advantage yelp. If they don't let everyone participate in the conversation equally then a business can't put their best foot forward. I did find it that the salon owner was much wiser about how she approached yelp than the bookstore owner. The bookstore person wasn't listening to her customers, and blaming the wrong person.
        • pyre 17y ago
• JCThoughtscream 17y ago
  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.
  • wonlove 17y ago
    or it could just not be true
    • houseabsolute 17y ago
      You do have to view the claims with some skepticism considering those making the claims stand to benefit substantially from people believing them, true or not.
  • gphil 17y ago
    > 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.
  • Tangurena 17y ago
    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.
• timcederman 17y ago
  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."
• zzzmarcus 17y ago
  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 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 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.
  • chaosprophet 17y ago
    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.
    • markerdmann 17y ago
      This is basically the project I started working on a few weeks ago. If anyone is interested in getting together on this, feel free to get in touch (my email address is in my profile). I'm a programmer located in the Mission district of San Francisco. It would be a nice to have a Craigslist or Wikipedia-style Yelp (fast, lightweight, and non-evil).
    • wonlove 17y ago
      Yelp doesn't charge biz owners to respond to reviews, in public or in private. I'm pretty sure about this because I built the feature.
• relme 17y ago
  http://www.yelp.com/myths http://www.yelp.com/myths
  • rosser 17y ago
    "I am not a crook." -- Richard M. Nixon
• RyanMcGreal 17y ago
  > 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.
• prbuckley 17y ago
  What happened to the article? I am getting 404 errors? Is this some sort of Yelp conspiracy? Maybe East Bay Express didn't pay up!
• neurotech1 17y ago
  The source is 404 Page Not Found http://www.eastbayexpress.com/gyrobase/yelp-extortion-allegations-stack-up/Content?oid=1176984&showFullText=true http://www.eastbayexpress.com/gyrobase/yelp-extortion-allega... Google Cache Link: http://74.125.155.132/search?q=cache:DdZjkw-XSRgJ:www.eastbayexpress.com/eastbay/yelp-extortion-allegations-stack-up/Content%3Foid%3D1176984+http://www.eastbayexpress.com/eastbay/yelp-extortion-allegations-stack-up/Content%3Foid%3D1176984&cd=1&hl=en&ct=clnk&gl=us http://74.125.155.132/search?q=cache:DdZjkw-XSRgJ:www.eastba...
• deleted 17y ago
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  • brown9-2 17y ago
    The article being linked to in this HN discussion is actually a response to the CEO's response (which you've linked to).
• motters 17y ago
  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 17y ago
    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.
• alttab 17y ago
  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.
  • brown9-2 17y ago
    It was Seth Godin and "Brands in Public": http://sethgodin.typepad.com/seths_blog/2009/09/launching-brands-in-public.html http://sethgodin.typepad.com/seths_blog/2009/09/launching-br... (I had the same memory this morning and tried searching for it and couldn't find anything, but thanks to your post I thought to include "brand management" in the search)
    • alttab 17y ago
      Good look. Thanks!
• wushupork 17y ago
  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.
• blasdel 17y ago
  JWZ has gotten the shakedown too: http://jwz.livejournal.com/1002269.html http://jwz.livejournal.com/1002269.html
• dmgrossman 17y ago
  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.
  • madh 17y ago
    Absolutely correct.
  • diego_moita 17y ago
    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.
• deleted 17y ago
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  • jamesbritt 17y ago
    "Complete sensationalism, no facts, just opinions. " Do you not think it worth something that the article includes lengthy quotes from people willing to go on record? Granted, these people could be making shit up, but they seem to be authentic. Are these people all conspiring to support the same made-up assertion that Yelp is strong-arming people? I'm not sure how one goes about proving such allegations, absent recorded phone conversations, but it looks pretty damning.
    • deleted 17y ago
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    • deleted 17y ago
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    • esornoso 17y ago
      Yelp :(
• marcusbooster 17y ago
  I would think with that many reviews the potential for libel is a concern.
• gursikh 17y ago
  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 17y ago
    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).
• BigDamnDeal 17y ago
  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.