Yelp's ad pitch gets bad reviews

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SEATTLE -- Some businesses say the consumer-review site Yelp isn't exactly what it claims to be: "Real People. Real Reviews." Instead, they say, Yelp manipulates how reviews appear to coerce businesses to advertise.

"If you buy ad space with them ($300 to $800 per month), this will help 'control' or eliminate negative reviews by reviewers of your business." That's the proposition Marcia Evans, owner of Jewel Hospitality, a Seattle catering company, described in a 2009 complaint to the Washington Attorney General's Office. Asked recently about Yelp, Ms. Evans said, "I hate them."

Stacy Oltman, the general manager of Hill's Neighborhood Restaurant in Shoreline, Wash., said she got a call in June from a Yelp salesperson who said, "You have gotten a terrible review online. We would love to help you remove it."

The number the salesperson gave her led Ms. Oltman to a Yelp call center where she got a pitch to advertise.

Stewart Patey, owner of Mattress City in Everett, Wash., and Kim Nguyen, owner of Hoa Nails and Spa in Redmond, Wash., have similar complaints: They say legitimate positive reviews on their Yelp pages disappeared recently because they did not agree to advertise with Yelp.

The San Francisco-based company says it doesn't do business that way. Regarding the offer to remove or downplay a negative review, Darnell Holloway, Yelp's manager of local business outreach, said, "Generally speaking, that is not a sales tactic from our company."

He insisted the company's approach is straightforward: "Businesses can't pay for favorable reviews, and our automated filter doesn't penalize nonadvertisers."

Yelp hosts about 30 million reviews -- anyone can write what they think about a company and rate it from a low of one star to a high of five stars. But the company uses an undisclosed algorithm to filter out about 20 percent of the reviews -- with the goal, it says, of enforcing guidelines such as no hate speech, and eliminating fake reviews.

The workings of that filter system were part of a class-action lawsuit, filed in federal court in San Francisco, that was dismissed in October and is now on appeal. The four firms that sued claimed Yelp "unlawfully manipulated the content of their business review pages in order to induce them to pay for advertising."

Reviews that are filtered out can be seen only by clicking the light gray word "filtered" at the bottom of the Yelp page. The filtered reviews are also not calculated in businesses' overall ratings.

Mr. Holloway said the filter is needed to prevent people from gaming the system and to enforce the site's rules. Those include no threats or harassment, no negative reviews of competitors, and no reviews without firsthand experience.

Lawrence Murray, an attorney for San Francisco-based Lawrence D Murray & Associates, which is handling the class-action lawsuit, said about eight other individual lawsuits have been filed as well.

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