I was recently invited to write an opinion piece for the San Francisco Chronicle discussing Yelp, issues of free speech, and what it all means for local businesses. My thanks to the editors for dedicating the space. Below is my submission (printed in Monday's paper)…
day in the summer of 2004, I got sick and needed to see a doctor. I
asked friends for referrals, but most of them were Bay Area transplants
and didn't have any good recommendations. I searched on Google, but
found only generic lists on health insurance Web sites. I wanted a
doctor that fit my needs, not just any doctor. I wondered why it was so
easy to find consumer reviews for products like books and electronics,
but so hard to find good referrals for local service providers like
doctors and plumbers. My frustration turned to opportunity when I
started Yelp with my friend, Russ Simmons. The Yelp website helps
people share their knowledge about local businesses. Yelp usage has
grown quickly; last month 17 million consumers used the site to read
4.5 million reviews about local businesses in the United States, Canada
and the United Kingdom.
influence on local commerce has led business owners (and local press) to ask: Is Yelp a good thing
for small business? For those businesses who treat their customers well (the
vast majority of businesses, as it turns out), the answer is yes, because Yelp
offers a phenomenal source of free marketing. Before Yelp,
businesses could only reach new consumers through word of mouth and advertising.
Word of mouth is great, but it travels slowly, reaching perhaps just a handful
of friends. Traditional advertising has been very expensive; it can cost $60,000
or more for a full page ad in the Yellow Pages. And because Yelp is basically
word-of-mouth online, it brings all the pros and cons of real referrals with the
speed of the Web. So what might be
the downside? That businesses can't control what their customers are saying
about them on the site (just like word of mouth offline). However, when consumers
research a business on Yelp, they are taking in the whole picture, including reviews, photos and service
offerings — not just honing in on one errant viewpoint.
With the cacophony
of opinions on the site, it's natural to wonder whether "anything goes" on Yelp.
Absolutely not. While we don't referee factual disputes, we do try to ensure
that reviews reflect a firsthand experience and don't betray any obvious
conflict of interest. We field inquiries daily from business owners and
consumers alike, and we consider each one carefully. We've even built
sophisticated, automated software to suppress suspicious reviews that might have been
written by an employee, owner or competitor. As a result, most businesses will
see reviews come and go from their Yelp page (whether they are a Yelp advertiser or not) as we work to ensure the site
remains a trusted resource.
coverage of Yelp has often focused on the downside for businesses of negative
reviews, even though 85 percent of the reviews rate businesses with three stars
(out of five) or higher, and such content is helpful to consumers. As a business owner myself, I empathize with how personal a
bad review can feel. In very rare
cases, businesses have become so distraught over negative reviews that they have
taken to the courts (as recently highlighted in two Chronicle reports).
Fortunately for consumers, the core legal issues have long been settled and very
clearly allow people to share their opinions — online or otherwise. In most
cases, however, savvy business owners use negative reviews as an opportunity to
reach out to that customer or to improve their service.
My once frustrating dilemma of
finding a medical provider is history. Today, I returned to a dentist I found a
couple years ago on Yelp; she now has 59 five-star reviews and a huge new office
that overlooks Union Square.
To create the Yelp site, we've ceded unprecedented power to consumers, but this
simply means power once wielded by an elite few is now in the hands of