Yelp grows up

Yelp opens the kimono

    For too long, Yelp has hidden the single bullet it had to prove critics and accusers wrong: All it had to do was reveal the reviews that its spam filter blocks, This week, they finally relented. Now the once hidden reviews appearing through a link at the bottom of every business’s page. The controversial reviews are tucked behind a “captcha” that insures whoever is reading the flagged items is a human.

    If you’re wondering why all the security is needed, it’s because the flagged reviews are essentially Yelp’s Big Mac sauce, its Colonel’s 11 herbs and spices, its Nieman Marcus Chocolate Chip cookie.

    Allowing spammers to see what Yelp’s system bans gives them a recipe to reverse engineer, to create spam that will bust through. Yelp engineers think they’ve solved that problem well enough to finally let users peek behind the curtain.

    And even if Yelp wasn’t ready, they may have to let the masses in anyway: Since Yelp trades in trust and integrity, the moment it ceases to be a reliable review source is the moment it goes the way of Citysearch or other ghost-town websites that contain nothing but spam and shilling. With these questions swirling, it seemed the right time to executives to roll out the new openness.

    The other change Yelp made was to remove the “favorite review” feature from its advertising package, replacing it with a photo or video gallery uploaded by the business owner. It’s “yet another way to further impress upon people that Yelp is a level playing field,” Sollitto says.

Chasing virtual ambulances?

    In the wake of the bad press around the lawsuits, that’s hugely important for the company. And the lawsuits, Sollitto points out, came after Yelp’s $500 million dalliance with a Google buyout fell through, leading to a new $100 million investment from Elevation Partners earlier this year. Yelp believes it’s dollar signs, not business practices, which brought out the attorneys. “Lawsuits often come to companies around financing rounds, that is a fact of life,” says Sollitto.

    Analysts often compare Yelp to pre-IPO Google, the period when the search giant had to balance revenue growth against eliminating spam that would have boosted traffic but sank its reputation it in the long term. In a way, Yelp’s line-holding is harder than Google’s, as there’s huge difference in public perception between banning spam websites and banning, in essence, spam human beings.

    Yet building a website that reaches into the downtowns of dozens of cities, connecting millions of savvy web users, is a huge value proposition and clearly its own reward. “Yelp is a disruptive technology, Sollitto said. “It shakes up the status quo, changes winners and losers and provides values in efficiency.” That’s one game the company seems happy to keep playing.