With its recent IPO and greater than $1bln market cap, Yelp has become one of the great success stories of the Internet. It sits right at the intersection of e-commerce and real commerce. However, the limitations of the website and its automated processes hamper its ability to reach its full potential.
A Bit About MyClean
MyClean is a NYC based residential and commercial cleaning company. Since its 2009 founding, we have become one of the fastest growing cleaning services in the city. We distinguish ourselves through our convenient online platform and our focus on customer service. When issues (inevitably) arise, they are handled quickly and professionally. We place a high value on our online reputation and, more generally our reputation. Our goal is 100% client satisfaction.
Yelp: Better Business Bureau on Steroids
At its best, Yelp provides a way for consumers to find and trust unfamiliar businesses. Looking for a kid friendly steakhouse in the Poconos? Yelp can help you find one. Wondering whether that pool installer’s estimate is too good to be true? Yelp can give you a hint.
The Advantages Yelp Provides to Business Owners:
Yelp is an invaluable resource in terms of customer acquisition. Customers go to Yelp when they are ready to buy. At MyClean, two of our strongest customer acquisition methods are: 1) Yelp organic results, and 2) Yelp pay per impression advertising. Yelp even offers video production as part of its advertising package. Yelp advertising has increased traffic to our site significantly. Moreover, Yelp allows businesses to post responses to reviews, to help refute misleading or inaccurate postings.
Yelp reviews tend to skew negative, particularly for commoditized businesses, like cleaning. Whereas people may be inclined to post a stellar review for a great restaurant or bar, they may not take the time when someone simply provided a great service. Moreover, the bad reviews will always be scathing, and the good reviews are taken with a grain of salt (in large part because of the manipulation discussed below). In fact, early on in our business someone posted a “quick tip” that our good reviews appear to be “advertisements,” implying that we wrote them ourselves. This is simply not true and we would never jeopardize the integrity of our business. Nevertheless, this “quick tip” remains.
This means that the bigger and more successful a company gets, the more negative reviews it will have. Whereas it is easy for a new company to maintain a five star rating, for example, for a mature company, a five star rating is nearly impossible.
Additionally, notwithstanding the marketing advantages outlined above, advertising on Yelp is inherently risky. If your company’s rating drops (either deservedly or otherwise), all the advertising in the world won’t bring in more business.
Further, though businesses can post responses to reviews, as mentioned above, this often provides little solace.
First, if you don’t have a writer (or in our case, a former lawyer) on staff, it may be difficult to craft responses to posts without appearing defensive or emotional (particularly when the posts are inaccurate and you may be frustrated that a client posted a negative review instead of reaching out to you to find a solution to the problem).
Second, one wonders whether the responses are even read at all. A prospective client may think “of course the company thinks they are right,” or not even get that far; instead skipping to a company with a higher nominal unfiltered rating.
A Yelp rating can make or break a growing business, particularly when that business acquires many of its customers online. Not surprisingly, this leads many businesses to attempt to “game” their Yelp rating by posting (or having others post) positive reviews, in the hopes of improving their rating. Some may even post misleading reviews about competitors, to improve their relative rating.
To combat these realities, Yelp has instituted automated filtering procedures to limit the effect of these attempted manipulations. Their algorithm is secret (lest it be further manipulated) but it basically filters reviews as suspicious when they are by a new Yelper or when they are posted by a person connected with the company.
However, these filters are far from perfect. In our case, Yelp has failed to filter a false review by a fictitious customer named “Cristina F.” who accuses us of theft. We take allegations of theft seriously, and we have NEVER had an unresolved theft claim. Moreover, at the time the review was posted, we had never even had a customer named “Cristina F.” Despite the obviously fraudulent nature of the post, and our repeated attempts to reach out to Yelp to flag the issue, the review remains. We often get calls from customers asking for reassurance about theft, when we have never stolen from our clients.
Even worse, this identical review was posted on a competitor’s website and was filtered! We are still waiting for an explanation of this (and I expect to be waiting a long time).
It is the policy of MyClean to never solicit insincere reviews. Nevertheless, Yelp’s filters have removed numerous genuine (and positive) reviews, including some by frequent Yelpers who only know MyClean professionally. Our filtered ratings average nearly a full star more than our unfiltered ones.
As you can see, Yelp’s automated filters are far from perfect. As Yelp continues to progress, it will likely need to institute some type of investigation or ombudsman program, to allow a company to defend itself against misleading or slanderous reviews and ratings.
Absent that, businesses and consumers may begin to question the value of the ratings and reviews, finding them to be more arbitrary than accurate.
In short, Yelp is a valuable tool to help market your business. However, businesses must carefully cultivate their online reputations to ensure that they are fairly portrayed. This means that, in many cases, Yelp ratings may be more accurate as a reflection of the business’s reputation management savvy than of the quality of the actual underlying business.
The business world will be watching to see how Yelp faces these challenges.