Application Critique

Posted: September 3, 2013 in Uncategorized

Yesterday evening was a fun one. It is not always that you get to hear a concise but in-depth analysis of the most influential apps around. The best (and most troublesome while preparing) part was that no presentation dragged on and on. Everything had to be simple and sweet by design. I have become a big fan of Pecha Kucha style, more than even Ignite. I think 20s is kind of perfect, the 15s allowed by the Ignite style feels too short now.

So, I am supposed to blog about Yelp. I got introduced to Yelp around last year and would you believe it, it was because a friend told me it was a good company to intern at. This was the period when I was applying for summer internships, my friends had got one already, and not for the first time in my life I started out too late. Even though I didn’t get an internship offer from them, I did get introduced to the service our relationship has continued since. So much so that I have begun to really look forward to seeing the The Weekly Yelp in mailbox every week.

Oh, and if this wasn’t enough, the presenter was awesome. Her public speaking skills were mind-blowing. Her turn to present was before our group and I remember thinking how I could ever match up to the standards other presenters were setting. And well, after looking at the feedback, maybe I actually didn’t. So, all in all, it was a good learning experience for me.

The presenter stressed a lot on how socially integrated Yelp was. She proved how good a strategy this was by stressing on the staggering 100 million unique vistor mark. Well, its hard to argue with that sort of number, isn’t it? Actually, the presenting group admitted that they couldn’t really accurately pinpoint just why Yelp took off like it did. But social integration was one of the strongest reasons they put forward. I have a few more hypotheses of my own but I couldn’t agree more with them on the social aspect. Yelp allows me to read reviews written by Facebook friends, see what my friends have reviewed and see which friends have liked a particular business. Not only this, Yelp allows me to view a feed of what my friends are doing on Yelp. These features are ‘killer’ because many a time, I have given a shot to 3 star eating places just because a few of my friends liked them. And this gamble has always paid off. So, I would go to the extent of saying that being able to see what my friends have liked/reviewed sometimes becomes more important than reviews of strangers. So, definitely a +1 from my side and kudos to the presenting team for identifying this.

Another fun fact that occured on me listening to the presentation was that Yelp = Yel + p => Yellow pages. Wow! πŸ˜€ This is one of those things which are so trivial that you keep thinking why it didn’t occur to you earlier.

But these fun facts aside, I really liked the story of how Yelp grew in its early years. The presenter mentioned the ‘People love us on Yelp’ campaign back in the days when Yelp was just another start-up. This is one of the examples of where conventional wisdom can hold us back. This sticker is just another advertisement if you go back to the time when Yelp was unknown but yet Yelp didn’t have to pay to get these on the windows of businesses. So, why would this work, you ask. Well, the presenters didn’t have time to elaborate on this but along with the sticker, Yelp also used to send a short and sweet letter congratualting the company on being recognized as a favorite by locals in their community. Marketing genius, I tell you! And they were smart enough not to do this to any random shop they stumbled upon, they included only the businesses that had a small number of trusted reviews. And fast forward 5 years, this growth hack did really pay off, didn’t it?

Fake and fraudulent reviews was another point which the presenting team churned up. This is so obvious but yet so horrifying in that if this threat became real in a significant manner, it could turn a success story into failure in no time. Would you use Yelp if you knew deep down that you couldn’t trust Yelp reviews because the awesome sounding eatery might be a rag tag place whose owner invested more in paying for reviews rather than improving the quality of the food? This point also resonated with me because fraudulence and abuse is what I am most scared about for my dream anonymous Facebook messaging application that I am building right now. But this is such a confidence booster too, because if Yelp could do it and make it big, so can I.

A point that I didn’t hear emphasised enough (to be honest, I don’t remember if they emphasised it at all, but just to be on the safe side) is the role that Yelp community managers play. Their team of 60 or so managers really deserves most of the credit for making Yelp as popular as it is today. Remember the ‘Weekly Yelp’ I mentioned at the beginning of this long rant, yes, that is curated by the awesome community manager for Singapore. Yelp’s community managers, according to Yelp, are hired for the knowledge and enthisiasm for the city they live in, and boy! do they show it.

According to me, one of the most intriguing things about Yelp is the business advertising they do on their website including preferred search result placement and speacial listing features. On googling Yelp, you always find some or the other news article about the controversy regarding how Yelp treats or mis treats the businesses who paid for these ads. Business owners have been known to get violent and cause a ruckus because they feel Yelp is harming their reputation. People have often accused Yelp of favoring its paying members by removing their negative reviews.

I also feel that the presentation gave a bit too rosy a picture of Yelp. Sure Yelp has expanded rapidly, but it is yet to turn a profit. Also, Yelp is facing intense competition from Google Places (fun fact: Yelp was close to being bought by Google in 2009). I seriously wonder if Yelp would be able to stand the enormous scale and aggressive mobile strategy employed by Google for Places. Add to this Android and the fact that Places is bundled into the OS.

Also, in my opinion, the perception of Yelp is taking a major hit from the allegations of extortion practices all of which have been vehemently denied by the company. There was even a lawsuit recently accusing Yelp of demanding paid advertising in return for suppressing or deleting bad reviews.

So, all in all, I hope Yelp can rise above the challenges and continue doing what it is. I love Yelp and if for nothing else, for the fact that it feels like a service made by humans. The social element is definitely a major plus but yet, challenges remain. After all, even though Yelp is based in the US, it is no NASA or Pentagon. It needs to seriously think about other possible avenues of monetization and act very quickly to stem the rising uproar of alleagations.

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Comments
  1. Steve says:

    Hi Shubham!

    The point that you’ve brought up about the community manager is interesting especially when you mentioned that Weekly Yelp is curated by a Singapore community manager. I visited a link at http://officialblog.yelp.com/2011/07/day-in-the-life-of-a-community-manager.html which is a blog entry by a community manager that talks about their life as a community manager (their scope of work is really fascinating!).

    The community manager in a sense, can be similar to what Bjorn has talked about in his growth hacking talk – “Fake it till you made it”, where part of the community managers’s job scope is to post reviews (possibly to give the impression that the site is very active). Also, it allows the early users to learn what kind of critque they should post and how you would rate or comment on someone’s critque (teacher of the entire ecosystem flow). From what I can takeaway, if you are a new startup that relies on user-generated content (like Yelp, Twitter or Hungrygowhere), you should certainly put aside some time or budget in generating good content to attract users for a start.

    It’s certainly a challenge for Yelp when competitors are getting better and better. The onus is on Yelp to think of features to enhance the whole experience and hopfully if there are enough user-generated content (I think there’s certainly improvement, I tried searching ATM machine from hougang, the nearest is at Kovan haha), it will be the main factor that entice user to stay.

  2. Hey Steve,

    Thanks for the link.

    I agree with you regarding the roles of community managers. I think it is especially important when you want to grow or expand. I would be interested in some study about the cost and benefits analysis of human capital versus online marketing. I would say that Yelp should focus on hunting more aggressively for community managers in Asia if it wants to rapidly expand in this geographical region. Moreover, you are perfectly right that any reviews website is as good as the reviews on it similar to how a social network website is only as good as how much of your social network is on it.

    I made the exact same search as you but I didn’t get any results from Yelp. You sure you pasted the right query? πŸ˜‰

  3. Ben says:

    I like the fact that Yelp sends letters to local businesses when they are voted as favourites by locals. This sort of thing helps a lot with marketing. On the local business’s POV, they are getting an “award” and they might treat it as certificates and place it on places that are easily seen by customers. From Yelp’s POV, they get more exposure from the general public. Truly a win-win situation!

  4. Ang Civics says:

    Hi, Subham, your blog post give me a more detail understanding of Yelp. I also feel that the business detail provided is really like a Yellow Page, I feel that it is one the precious data owned by Yelp. I will think Yelp can develop better and further if it was bought by Google. Since Google can embedded Yelp into their search engine while Yelp will be introduced and supported for more country. However, if Yelp wanted to expand to all over the world, they may need to think a more efficient solution for managing fake review. They should handle how they make money too, bad reputation will let user feel that Yelp cannot be trusted.

  5. Kuan Yan says:

    Yelp definitely thrives in the US.
    In Asia? Not so much as there are too many better local alternatives (e.g. hungrygowhere in Singapore). However, they are definitely making a big push into this region!

  6. @Ben – Yup, sending out letters to local businesses who have been voted as favourites is an excellent marketing strategy that Yelp used to follow in their earlier days. I don’t know if they do so now (anyone knows?)

    “On the local business’s POV, they are getting an β€œaward” and they might treat it as certificates and place it on places that are easily seen by customers. From Yelp’s POV, they get more exposure from the general public. Truly a win-win situation!” You just summarised so eloquently what I wrote in a much lengthier paragraph. Thank you!

  7. @Ang Civics – Yes, it makes complete sense for Google to acquire Yelp. But it might never happen now. Bing and Apple have partnered with Yelp. If users search on Bing, relevant Yelp reviews will display on the right side of the screen. Plus, Apple has joined forces on its new maps application along with providing more content to Siri. Google should have gone through with the deal to acquire Yelp while they could, I wonder if the bird has already flown away now. Google has to draw more reviews and more attention to Places.

  8. Camillus says:

    I believe Yelp β€œgrew up” in a time when Google/Bing maps were still in their respective infancies and did not pose a viable threat. When faced with competition from Google Reviews now, in particular, Yelp’s core business as a reviews service (as opposed to maps service) allows it to concentrate on non-digital differentiation and marketing such as window stickers. Its strongest competitor in the US is TripAdvisor, which also shares a similar strategy.

    With regard to its lack of success in local markets, one could argue that the local culture is rather apathetic about writing reviews, and good news spreads by word of mouth.

  9. Chen Liang says:

    Yes, Yelp did very well with the “People love us on Yelp” campaign. It gave shop owners a good reason to want to put on the

    stickers, like a badge of honour. Another reason for the campaign’s success can also be because it created value out of

    nothing by ensuring a win-win situation for both parties.

    @Camillus: Agreed. Most people in most places are apathetic about writing reviews. Yelp’s strategy of hiring community manager is a smart move towards solving that chicken and egg problem.

  10. Chen Liang says:

    Yes, Yelp did very well with the “People love us on Yelp” campaign. It gave shop owners a good reason to want to put on the stickers, like a badge of honour. Another reason for the campaign’s success can also be because it created value out of nothing by ensuring a win-win situation for both parties.

    @Camillus: Agreed. Most people in most places are apathetic about writing reviews. Yelp’s strategy of hiring community manager is a smart move towards solving that chicken and egg problem.

  11. @Kuan Yan – The advantage that hungrygowhere has is the same one that Facebook had when Google+ launched – a thriving community. But I believe the better product wins (do you agree? Because even though I would want this to be the case, I think it might not always be true). Yelp’s social integration is much better than hungrygowhere. I can’t see what my friends are doing, for example. So, I think hungrygowhere needs to put more resources into integrating the user’s social graph into the experience or Yelp might just succeed even in Singapore because the social graph integration can cause Yelp to grow virally.

  12. Aik Siang says:

    Hi Shubham, it leaves me to wonder how the app is able to sustain its finances in long term. It was mentioned that having honest reviews seemed to be the backbone of what the app claims to be, however without tempering with this(things like yelp sort) it seems that there are little ways that the app can monetize and still hold on to its initial beliefs.

  13. ivan. says:

    Hi Shubham, yes Yelp indeed only made a profit in one of it’s quarters (Q2 2012) so far. I was supposed to point that out and question whether it had a viable business model in the last slides. I kind of took too long before that so I had to skip over it though. I definitely was aiming for a balanced take on Yelp, rather than paint a too-rosy picture. So my bad there haha.

    Anyway, so Yelp actually sustainable? That’s really hard to say. For all you know someone would just buy them out at the last moment. After all, YouTube was marked as having an unsustainable growth model (like many startups today) by industry experts. Then they got bought out by Google of course. And even so, YouTube was making a loss for Google until very recently I believe. But Google believes in data and audience so they didn’t really care. They have the capital to make losses for what could be future profit – something that startups don’t actually have, and should not actually plan to do. So maybe the best thing Yelp could hope for now is to get bought out haha!

    As for Singapore, Yelp only recently tried to break into the Singapore market, advertising heavily here (that was in the quarter where they made a profit). Based on anecdotal experience, I’m not too sure that actually worked long-term. We’ll just have to wait and see what happens now, if they are able to turn things around by breaking into new markets like Singapore, or will flop eventually, and learn from their mistakes or successes =).

  14. @Camillus – Thanks for pointing out TripAdvisor. I had forgotten about it. Yup, they are competing with Yelp too. Again, I would say Yelp is much more socially integrated. Also, submitting a review is much faster on Yelp.

    Moreover, unlike Yelp, TripAdvisor will not publish your review until it gets approved by the TripAdvisor team. This process is to make sure that no β€œfalse” reviews make it on the site. Your review on Yelp becomes β€œlive” as soon as you hit submit. This authentication delay should indicate that a review on TripAdvisor is more authentic than one on Yelp. However, I have never seen a statistic to back this claim. What do you think about this? Which side are you on – speed and instant gratification or authenticity?

    I agree with your point about Google Maps being in its infancy when Yelp came of age? Do you really believe the result would be different today if if Yelp didn’t exist two years back or do you think there is some value and differentiation in what Yelp provides?

    Oh, and I didn’t know that TripAdvisor also gives out window stickers. I have seen people asking for stickers on TripAdvisor forums. Thanks for this piece of information.

    I dare say I disagree with you about your opinion that the local culture is apathetic about writing reviews. hungrygowhere is successful because of awesome reviewers πŸ™‚ I would be very interested if you could provide some sort of statistic or article comparing these things among cultures. If what you say is indeed true, that means businesses need to realize this difference and change their product offerings according to the target region. Especially true of a company born in United States like Yelp.

  15. @Chen Liang – “Most people in most places are apathetic about writing reviews. Yelp’s strategy of hiring community manager is a smart move towards solving that chicken and egg problem.”

    You are spot on here πŸ™‚ Thanks for mentioning it this way. Makes complete sense.

  16. Yelp did actually come from “Yellow Pages”. The developer of the app was inspired by Yellow pages and sought to come up with a less heavier version that is more portable than the real Yellow Pages.

    The sticker thing is a pretty innovative campaign done by Yelp. A few dollars on envelopes and stickers, sent to businesses (notably retailers and diners) did a long way to attracting people to use Yelp. Entrepreneurs probably heard of Yelp from other entrepreneurs. A casual chat amongst bar owners may turn into a conversation about Yelp. On the general public side, some retailers had put up stickers – usually on the windows and even on the cashier desk – sort of like even more “free” advertising for Yelp.

    Yelp had a pretty good “monetizing” strategy (some may say its not fair – hence the fraudulent part). Yelp does have something like a subscription service for business owners ($150/year), where they can influence the reviews by paying money. Sounds like a scandal, but it seems to work for Yelp.

  17. @Aik Siang – Very good question. This is exactly what I asked the presenters πŸ™‚

    Here is what I believe to be correct after reading many blogs and using Yelp myself –

    1. Most of Yelp’s revenue comes from local advertising. This segment consists of enhanced profiles for SMBs and national chains with individual locations. Enhanced profiles push your profile links to Yelp search (desktop and mobile) and competitor’s profiles, while also clearing ads from your own profile, and you can choose multimedia such as slideshows.

    2. Display or brand advertising (think restaurants and social chains). Yelp enables leading consumer brands to display their graphical and text ads on its platform using fixed-price or impression based plans, giving their brands exposure to millions of visitors.

    3. Affiliate revenue for things like OpenTable or Orbitz bookings – Yelp offers its users the ability to book restaurant reservations through OpenTable directly on the Yelp site. Now, this service is even available on all mobile platforms (iPhone, iPad and Android).

  18. @Ivan – You guys did a fantastic job with the presentation, no two opinions on that. Unfortunately, the format of the critique required me to point out even the tiniest of tiny flaws 😦 But seriously, your team did a super awesome job and I will take nothing away from that πŸ˜€

    Actually, as far as I know (http://techcrunch.com/2012/08/01/yelp-q2-2012/), Yelp didn’t even make a profit in Q2 of 2012. Sure, it narrowed down its losses a fair bit πŸ™‚

    And thanks for bringing Youtube into the discussion. Its a case in point. Youtube was ridiculed by many pundits. Even when Youtube was about to launch ads, they said that it wouldn’t work because its audience had become accustomed to seeing ad-free content. There was also much speculation in the media on whether some of the content on YouTube was too unseemly to attract big advertisers. Moreover, almost everyone said that the Google acquisition of Youtube was a bad idea for Google. They called it “Gootube”.

    Actually, I was thinking of another route for Yelp but do not know if it will bring in enough revenue. Like its deals with Apple and Bing, Yelp could offer to integrate its local business search into other platforms (maybe even Google search, but do you think Google will do this since it wants to make Places popular?). It will be a win-win for everyone, especially the users. The users don’t need to go to Yelp to search for places to eat and can do so from the comfort of their home page (even better, their Android phones just like how Yelp is integrated with Siri). However, this will take away from Yelp’s brand advertising revenue. Moreover, it all depends on how much cash the companies are willing to shell out to convince Yelp to agree to integrate with their platforms.

    I can’t find any evidence of Yelp turning a profit. Could you please point me to a link so that I can correct myself? πŸ˜€

  19. @Nicholas – Yep, this is what Wikipedia says –
    “Yelp Inc. developed out of a business incubator called MRL Ventures that was founded by Max Levchin and several former PayPal executives. Stoppleman proposed a web site where users could ask friends for their recommendations on local services via email and Levchin agreed to invest $1 million in the project.MRL co-founder, David Galbraith, who had instigated the research into a Yellow Pages style Internet product, came up with the name “Yelp”, and the project was launched in 2004.”

    For people who aren’t aware, Jeremy Stoppleman is the co-founder and CEO of Yelp.

    You are spot on about the stickers, though you are better at explaining stuff than me as is evident by my post πŸ™‚

    “Yelp does have something like a subscription service for business owners ($150/year), where they can influence the reviews by paying money. Sounds like a scandal, but it seems to work for Yelp.” I am so glad you made this point.

    I do not think Yelp influences reviews based on whether someone subscribed or not. To investigate this very claim, a study by Michael Luca from Harvard Business School and Georgios Zervas from Yale University used data collected over three years to parse Yelp reviews. Luca, Assistant Professor of Business Administration at Harvard, found that after studying a set of restaurants that advertise on Yelp, determined those businesses have reviews filtered in the same manner as restaurants that are not advertising on Yelp.

    Sure, Yelp has a filtering system that protects consumers by screening out phony postings. Yelp says that its algorithm was developed so businesses would not post fake reviews to deceive consumers. However, until they open source the algorithm, there is no way for us to know for sure. I actually do now know who to believe – business owners or Yelp. Both have a stake and so neither can be trusted to give an honest opinion. That is why I relied on the study conducted by a HBR professor. But still, I would be very interested to know if you could point me to some resources that make a strong case on the business owners’ side. I think what might have happened is that some genuine reviews were erroneously marked as fraudulent by Yelp’s algorithm. And I can also understand from the business owner’s point of view. Imagine your startup (the dream of your life) getting a bad name just because an algorithm made a mistake in tagging some reviews!

  20. chinab says:

    Very in-depth blog there Shubham! I enjoyed reading it as I am avid Yelp user.
    I wanted to discuss something here which you pointed out about Yelp having fake reviews (paid by business owners).

    Most businesses can see a nice increase in business if they receive positive recommendations on Yelp. But what happens when a business gets a negative review? Or several? Bad user reviews can destroy the business’s reputation. We all know that Yelp keeps its recommendation filter secret to the public. This way, we will not know their true intentions on how they display reviews.

    But if I am aware of it, why do I still use Yelp or its competitors like hungrygowhere? Thats because I still want to see reviews – at the back of my mind, i can empathize with the reviewer. Thats how human psychology works πŸ˜‰

  21. @Chinab – Haha not nearly as detailed as yours! Still have a lot to learn from you as far as blogging is concerned πŸ˜€

    “I wanted to discuss something here which you pointed out about Yelp having fake reviews (paid by business owners).” Thanks for bringing this point up. This reminds me of something I forgot to mention in my blog. Yelp has taken yet another step in its aim to eliminate fake reviews from the website. Yelp will now display the new consumer alert messages on suspect business pages for up to 90 days with a link to the “evidence” that something phony has been going on. But of course, if Yelp itself is involved in the dishonest practice of fiddling with a business’ or its competitors’ positive and negative reviews, its another matter altogether.

    Interesting point about human psychology there, Chinab. What you say might well indeed be true. I watch WWE even though I know the fights are decided in advance and the bruises are fake. I guess, when it comes to reviews, we don’t completely believe the review. We take it in with a pinch of salt and then try to fit it in with the pre-conceived model we have of a business in our mind. If the review is drastically different from out mental model, we will look for more reviews or try to verify the reviews and so on before changing our mental model. if a review asserts or align closely with out mental model, we reinforce the parameter we have associated with the knowledge content in our head so that it may take many more reviews now to displace that or change our opinion. And this is why I love machine learning! πŸ˜›

  22. benedictljj says:

    Wow, you applied to Yelp? You have to share your interview experience with me!

    Yes, Yelp is pretty awesome. Being in the US right now, I can personally attest to the number of times it has help us find (good) food.

    Just like you, I hardly knew anything about Yelp before the presentation. The marketing campaigns were truly inspiring. The level of creativity was amazing. However, though your post, I’ve learnt about the roles of community manager. If there’s anything that I’ve learnt so far – getting close to your users is extremely important.

    Thank you for your post!

  23. Nice post, and really surprised that you actually applied to Yelp before! I think I will take some time to try Yelp out next week. And nice link on ‘Yelp = Yel + p => Yellow pages.’ πŸ˜›

  24. Yang Zhixing says:

    Hey Subhuman, yeah it was quite a challenging task to prepare this presentation because you have to take very good care of your timings. But hey, you’ve done a good job! And while I’m reading your post, I’m impressed by your ideas in the post. I have some thoughts to share with you as well.

    I, too, believe that social integration is a key success feature to Yelp. Social network service is being extremely popular in our generation and even in the next! I’ve seen some the Facebook accounts of babies even before they are born (of course created by their parents lah)!

    What I want to stress is that when we build an app, we need to think about ways to involve the user and their friends in. This is what the USER cares about nowadays. We need to think about the user first. If we could be able to provide chances for the users to interact/mingle with their friends, and integrate it well with SNS, then there’ll be a high chance that we’ll have an overwhelming number of users! If people feel good about it, they’ll invite more friends. Indeed, people is the best advertisement! Just think about it this way, 1 user brings 10, 10 bring 100, and the number runs on.

  25. @Benedict – Yeah, I did apply to Yelp but they didn’t call me for an interview πŸ˜›

    Since you are in the US, could you compare the popularity (and your opinion of their usefulness too) of Yelp vs. TripAdvisor vs. Google Places? Please include other competitors too if they are significant πŸ™‚

    Yup, how to get close to users and its importance is my take away from Yelp too. I am not a very social person and so I didn’t really care about this much. I used to think that the better and more technically sound product wins. But, I have begun to realise how important the human aspect it. The old cliche really fits here – “Man is a social animal”

  26. @ZX – I am not “Subhuman”, just “Shubham”. Maybe you can just call me ‘Shubh’ like I just call you ZX. But ZX sounds so much cooler though, I am sure everyone will agree.

    Really, was this presentation a challenge for you? You were awesome in your part. Unlike me, you were not nervous at all, very steady and very convincing. A pro, it felt like.

    “Social network service is being extremely popular in our generation and even in the next!”. As our dear Prof Colin pointed out in the first lecture (I believe the slides were from Prof Ben though), social networking, mobile computing and cloud computing are the three key trends in computer science. (I hope Prof Colin reads this comment, shows how attentive I am in class πŸ˜€ πŸ˜› ).

    Haha…I want to agree with the point about the exponential growth in the number of users with good social integration. So, do you think Cloakie has this sort of social integration? πŸ˜‰ I want to see such growth in our baby too πŸ˜€

  27. @Wang GaoXiang – Yo, fellow team mate! πŸ˜€ You must try Yelp. Its awesome. If for nothing else, just try it to read the weekly Yelp newsletter. The community manager for Singapore really does a great job of it and I love reading it. You will find places you never even thought existed. And since you are a foreigner like me, all the more reason πŸ™‚

  28. Jenna says:

    Whoops, trust me the lagger to not have linked up Yelp with “Yel” + “p(ages)” till now, despite having heard repeatedly that its inspiration came from the Yellow Pages. I’ll be damned!

    “Fake and fraudulent reviews was another point which the presenting team churned up. This is so obvious but yet so horrifying in that if this threat became real in a significant manner, it could turn a success story into failure in no time. Would you use Yelp if you knew deep down that you couldn’t trust Yelp reviews because the awesome sounding eatery might be a rag tag place whose owner invested more in paying for reviews rather than improving the quality of the food? This point also resonated with me because fraudulence and abuse is what I am most scared about for my dream anonymous Facebook messaging application that I am building right now. But this is such a confidence booster too, because if Yelp could do it and make it big, so can I.”

    Personally, I feel that there is a huge difference between Yelp and your dream anonymous Facebook messaging app. Your app would be similar to an online chat room where the honesty and genuineness of users should be a lot harder, if not impossible, to ensure and keep a tight hold on. For Yelp, I should think that this problem is not really that big or elephant a problem. Sure, it faces the usual fake positive reviews made by people interested in the reviewed restaurant / company. Beyond that, however, I should think things are really well within their control. They could build a monetizing system and get people to pay for good reviews and / or to hide the bad ones OR they could simply choose not to betray their users’ trust and faith and preserve their authenticity and goodwill. Fraudulent reviews can also be easily vetted and removed. In short, the extent of fraudulence is very much within their control. Endorse or combat, the decision is very much open to them.

    This is however, not something easily achievable on your app, if at all. It will not be possible to track each and every user to ensure that he or she is not presenting a fake persona. In fact, that pretty much violates the entire anonymity promised them. Given the (truly) live / real time nature of the interactions between users, vetting is not really an option. What’s more, given the 1-to-1 characteristic of your app (I assume!), hiring moderators is not exactly helpful either. I guess that means you can only fall back on automated censorship, which is unfortunately, not exactly effective or sufficient in combating fraudulence. It merely keeps the conversations clean; hardly an obstacle to deliberate deceivers, being as easy to bypass as they are. Really trivial in the general face of things.

    Just my 2 cents worth~

  29. @Jenna – You are most definitely not alone! It occured to me too only during the presentation! πŸ˜€ Kudos to the speakers for ingraining this fun fact into our minds πŸ˜€

    “Your app would be similar to an online chat room where the honesty and genuineness of users should be a lot harder, if not impossible, to ensure and keep a tight hold on.” You are right, even though I could monitor everyone’s activity by processing the database logs now, this breaks the reason we built the app – anonymity. I will be including encryption into my product’s offering pretty soon and I will definitely not keep the keys. So, yeah, you are right in a sense. But I plan to allow the users to block spammers or people who take advantage of their anonymity to abuse others’ rights to have a good experience with Cloakie. So, all is not hopeless yet πŸ™‚

    “Sure, it faces the usual fake positive reviews made by people interested in the reviewed restaurant / company. Beyond that, however, I should think things are really well within their control.” Things are within control only because Yelp takes extreme care of this. Otherwise, this can really be a big problem. Fake reviews will mislead genuine users resulting in a bad name for Yelp. Less users = less reviews increasing the concentration of fraudulent reviews. This can turn ugly very quickly. So, I think the presenting team was very right in depicting this as a big problem, but Yelp has been reasonably successful in keeping it under control.

    “They could build a monetizing system and get people to pay for good reviews and / or to hide the bad ones” This is the big debate. Some non-paying or reluctantly paying business owners claim Yelp does this already while Yelp denies it. In my opinion, playing with any reviews (which are not machine generated or fake) should be avoided. There is nothing that pisses people more than seeing their genuine review demoted or bad review removed. People might stop using the service.

    ” they could simply choose not to betray their users’ trust and faith and preserve their authenticity and goodwill.” I believe this is the right strategy πŸ™‚ But their users’ (from what I know, the business owners’ in particular) faith is being shaken up by the frequent controversies.

    “Fraudulent reviews can also be easily vetted and removed.” It would be awesome if you could post some pointers to identify the fraudulent reviews easily. To me, it seems like a complicated task, but I am really interested in learning from you πŸ™‚

    “It will not be possible to track each and every user to ensure that he or she is not presenting a fake persona. In fact, that pretty much violates the entire anonymity promised them” True.

    “Given the (truly) live / real time nature of the interactions between users, vetting is not really an option.” Well, I could at least prevent people from typing abuses to some extent. But yes, you are right. Solving this problem will be a challenge.

    “What’s more, given the 1-to-1 characteristic of your app (I assume!), hiring moderators is not exactly helpful either.” Yup, its 1 to 1. Do give Cloakie a try – bit.ly/cloakie πŸ˜€ Even if it was helpful, I lack the funds to hire moderators haha

    ” I guess that means you can only fall back on automated censorship, which is unfortunately, not exactly effective or sufficient in combating fraudulence. It merely keeps the conversations clean; hardly an obstacle to deliberate deceivers, being as easy to bypass as they are. Really trivial in the general face of things.” True again πŸ˜€

    Haha thanks a lot for giving some thoughts to my app πŸ˜€ Much appreciated πŸ˜›

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