Schafer: Yelp fosters suspicion among small businesses

Lymarie Jimenez opened Sugar Love Bakery in Woodbury in January, and so far she's doing well.

She even caught a break by having the space next door leased by a bridal shop, a great neighbor for someone in the wedding cake business.

Now, if she could only keep Yelp from ruining her life.

What, isn't Yelp a harmless and helpful crowdsourced consumer review site? Not to Jimenez, who believes that nearly 20 positive reviews of her business were suppressed by Yelp, while two negative reviews are prominently displayed as "recommended."

To her the only logical explanation is retribution for her declining to advertise with Yelp.

Her experience is far from an isolated case. Yelp denies that it does this sort of thing, but it has been the subject of frequent complaints to regulators and a number of lawsuits.

Serious misdeeds have never been proved. But if I were Jimenez, I'd be suspicious, too.

Yelp may have had more than 53 million reviews written on its site since its founding, but the way it makes its money is largely from advertising.

Jimenez turned Yelp down.

Within a couple of days a one-star review showed up, she said, the first review by that poster. That means he opened a Yelp account just to write something bad about her bakery.

She didn't think much of it, as some great reviews were showing up, too. Over the next few days, however, all of the positive reviews left the site. The negative review stayed.

As Jimenez was telling her story this week, there were four recommended reviews on the Sugar Love page. Two were from so-called "elites," a kind of Yelp super reviewer. One was for three stars and the other was for five stars, the highest rating.

For a more complete view of what customers really think, here's a tip: Click on the link at the bottom of the page for reviews that aren't "recommended" by Yelp. There one finds just one one-star review of the bakery — and 18 four- or five-star reviews.

These reviews had been "filtered" by Yelp. The filter is a black box, an algorithm, created by Yelp to block reviews that seem fake. Part of the reason business owners don't trust Yelp is that it's never said much about what happens inside its black box.

Some of the 19 blocked reviews on Sugar Love were by people who had made no other reviews. Jimenez said she can understand the algorithm deciding these were not real. But why continue to recommend the two one-star reviews, also by first-time contributors? What made them seem more real?

There's no phone number to call, she said, so she said she just dialed extensions in the call center until someone picked up his phone. She got that person to agree that her review history seemed odd. But he wasn't going to do anything about it.

"They kept saying, 'It's not us, it's the software,' " she said. "If it's their software, then fix it."

She didn't create this page for her business or ask for it, but she needed to spend $300 a month to keep a competitor from advertising there?

That sounded kind of thuggish.

On the other hand, it's more or less how publishers of the Yellow Pages made their money for years.

The ads now there are for a row of businesses at the bottom under the heading "Best of Yelp Woodbury — Bakeries." The only thing notable here is that none is actually in Woodbury.

Harvard Business School Prof. Michael Luca said he has heard from small-business owners like Jimenez before, because he's been studying crowdsourced review sites like Yelp for several years. His first paper found that good Yelp ratings can lift the sales of independent restaurants while doing next to nothing for sales at chains. That's great for small businesses.

Part of the hostility comes from the structure of Yelp's business, he said, the "tension" of seeking ad dollars from businesses rated on Yelp's site. Another issue is that Yelp can't just open up its black box to show how it filters reviews, for fear of making it easier for cheaters to game the system.

He later tried to figure out how ad clients fared with the review filter, whether it was true that advertisers were getting more of their five-star reviews shown and more one-star reviews filtered. And, he said, "that's just factually inaccurate."

The company's spokeswoman, of course, said "there has never been any amount of money a business can pay Yelp to manipulate reviews, and our automated recommendation software does not 'punish' those who decline to advertise." A follow-up e-mail suggested that in the case of Sugar Love the filter was doing its job.

Jimenez sounds like she's done listening to Yelp's explanations, but there apparently is conventional wisdom on how owners should play Yelp.

One idea is to immediately respond to negative reviews in a professional tone that asks what could be done better next time. Another is to ask happy regular customers to jump on Yelp to review, and coach them how to fill out a full profile and review others, all with an eye toward not getting filtered.

"I knew to expect mostly sweets and desserts," it reads. "But for breakfast they had a cinnamon brioche twist, and it was terrific."

I can confirm that was a legitimate, paying customer review. It'll be interesting to see whether it stays "recommended."