After Morningside Heights restaurant owner James Lenzi refused to buy advertisements from the web company Yelp, Inc., he started to notice negative reviews of his business appearing at the top of his Yelp web page.
And according to Lenzi, representatives from Yelp persistently called over a span of several weeks.
Now, after Yelp has implemented new policies meant to increase transparency, Lenzi said he’s realized that the company’s practices of extortion are much worse than he originally imagined.
Yelp is a popular San Francisco-based web service that operates a user-based search and review system of businesses around the country. In March 2010 alone, the site yielded more than 31 million viewers. Each business on the site has its own page, where users post reviews and rate the establishment out of five stars. The reviews appear in no specific order—they are neither chronologically ordered nor sorted by rating.
But Lenzi, owner and chef of Haakon’s Hall restaurant on Amsterdam between 118th and 119th streets, contends that Yelp has manipulated his business’s Yelp page by moving up bad reviews as a direct result of his refusal to advertise with the site. He says the company promised to maneuver his restaurant’s reviews in an appealing fashion, under the condition that he pay for advertisements.
“They’re blackmailing me to advertise with them,” Lenzi said. “They called me three times trying to get me to advertise. When I told them I couldn’t afford it, they said they could move around the reviews once I became a business client.”
Lenzi’s claims of extortion are not unique. Over the last few months, three civil lawsuits from across the country have been filed against the company, accusing it of extortion. One of these suits has developed into a class-action suit, which contends Yelp’s pages are biased in favor of businesses that opt to advertise with the site.
But on Monday, the situation for Haakon’s Hall got a lot more complicated.
Yelp announced that new measures would be implemented to increase transparency within the site. Yelp uses a “Review Filter,”—which the company says operates on an automated algorithm—to syndicate established users’ reviews and protect against fake or malicious content. This feature has been a source of controversy with opponents of Yelp, who argue that the filter is not automated and unbiased, but is rather a tool to intimidate businesses into paying for ads.
In response, Yelp, through a link at the bottom of a business’ page, now allows users to see reviews that have been subjected to the “Review Filter” and taken off of businesses’ main web page. Policy change also impacted paying advertisers, who will no longer be able to post their “favorite review” to the top of their page.
These moves come in the wake of the formal legal complaints, though the cases are still pending.
When Lenzi found out this new policy on Tuesday and checked out his filtered reviews, he said he was infuriated with what he saw.
Of 13 filtered reviews once inaccessible but now available for viewing, two were four-star ratings and the other 11 reviews had the full five-stars. “That is just awful,” he said. “They don’t know the damage they’re doing.”
Despite the fact that filtered reviews, removed from the main page, average close to a five-star rating, Haakon’s Hall’s Yelp profile displays an overall rating of only three and a half stars, based on 34 reviews published.
Lenzi also cited the fact that two out of the first four reviews visible on the page were one-star ratings as evidence of his page’s manipulation.
There are only five total one-star ratings for his restaurant on the entire page, and two of those appear near the top.
Yelp has categorically denied all claims of extortion. “Yelp does not manipulate review content to help advertisers or hurt businesses that don’t,” Chantelle Karl, East Coast public relations manager for Yelp, Inc., said in an email responding to questions about Lenzi’s accusations. “Never have, never will.”
Yelp has attributed complaints like Lenzi’s to a misconception of how reviews are placed on a business’s page, through the filter.
Karl said, “This automated process sometimes creates the perception that reviews are being deleted and re-added over time; what’s actually happening is users are becoming more-or-less established over time.”
These denials of any wrongdoing have not stopped Lenzi from being proactive on the issue. He has expressed interest in joining the class-action lawsuit, but for now, he has begun an anti-Yelp campaign within his restaurant.
Below the listed foods and drinks in a menu pullout, a text-line embedded within asterisks instructs customers to boycott Yelp, “the internet Gestapo.”
An anti-Yelp message will also accompany new additions in bound-menus, and Lenzi said he plans to place signs in his window.
“They can make or break your business,” he said, adding, “This isn’t about money. It’s about destroying people’s dreams.”
Professor Gita Johar, a marketing professor at Columbia Business School, recognizes the severity of the recent claims against Yelp. “With a site like Yelp, you reach people at the point when they want to make a decision,” she said. “The order of reviews can have a huge impact on the consumers’ ultimate decision.”
Marketing Professor Kamel Jedidi of the Business School said that while the cases are played out in court, Yelp could suffer a major public relations blow.“Everything is based on trust and if trust is questionable, then they’ve lost their business’s purpose.”
For Lenzi, who started his business in the summer around the corner from his home, these kinds of actions cannot be tolerated.
He said, “Everybody’s afraid of Yelp ... But me? I welcome the fight.”
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