Plaintiffs in multiple lawsuits have unsuccessfully argued that Yelp is a “shake-down” racket that manipulates reviews to encourage SMBs to advertise and punish those that don’t. At the heart of these claims is Yelp’s controversial and often misunderstood “review filter.”
Now a new crowdfunded documentary seeks to make the same argument to the broader public. A press release and several articles on it yesterday were being blamed for a drop in Yelp’s stock. (The stock has recovered today.) The kickstarter project has raised roughly $17,000 of its $60,000 goal.
The claims in the trailer (below) are pretty sensational — all of which have been made multiple times before. There’s a good deal of merchant resentment (even bitterness) out there against Yelp and that continues to fuel what might be called “magical thinking” about the operation of the review filter.
Nonetheless the persistence of these rumors and beliefs about the connection between reviews and advertising on Yelp suggests that some of the often inexperienced salespeople have contributed to the misperceptions that continue to plague Yelp. And I continue to be surprised by the strength of these rumors and the fact that many industry insiders believe them as well.
Why do you think these rumors and beliefs about Yelp persist despite waves of unsuccessful litigation? Do you think it’s a “rogue salesperson” issue or is it a function of salespeople under pressure implying an ads-reviews connection to close new accounts? Do you think it’s a more systemic sales training issue that the management is not addressing? Or do you actually believe the “extortion” claims are real though unproven?
Facebook’s Jonathan Czaja was interviewed by StreetFight this week. Czaja is a terrific guy who came to Facebook about a year ago from retailer Bonobos. Czaja defends Facebook’s throttling of organic News Feed reach and says that the company’s ad programs are evolving.
Perhaps the biggest “reveal” of the article is that Facebook is investing “heavily in building a customer service organization because we realize small business require a level of support that we’re not providing. For instance, we’re testing live chat capabilities today, so we can talk with Facebook advertisers to do things like screen sharing and we’re close to testing voice support as well.”
Here are a couple of other interesting statements from Czaja:
A decline in organic reach does limit the amount in which you can communicate with your customers in the way you used to be able to do on the platform . . . There’s still a lot of value to the Page apart from distributing content to your fans. We’ll have a lot more to say about Pages going forward, and we do think it’s important that small business create a presence on Facebook and demonstrate the value they bring to their customers.
We’re seeing a lot of promising results [with Conversion Lift Measurement,] but the challenge is that, at the moment, it’s only effective for the larger advertisers who can provide a large enough sample of point-of-sale data to demonstrate lift. Without that large dataset its much harder for marketers to measure performance, so I’m not quite sure if it will apply all the way down to single stores in small locales.
Here’s my reaction to the interview:
Not discussed in the article, but most critical now for SMBs is to have a Page that provides consumers with “validation.” There are more local business ratings and reviews (broadly defined) on Facebook that anywhere else online and consumers are checking them before making purchase decisions.
Accordingly, there’s a somewhat hidden, Yelp-like use case that’s happening on Facebook. SMBs don’t fully recognize or understand this. Not having a rich Facebook presence is a bit like not having reviews on Yelp — you won’t seem credible to consumers.
Czaja also didn’t discuss “resellers.” This has been the key to Google’s SMB strategy. And while there are many companies that sell social presence/marketing to SMBs already (e.g., G/O Digital) there’s no formal reseller program that I’m aware of.
Some sort of reseller program (for lack of a better term) is inevitable for Facebook. It would be better for the company to realize this now and start training and certifying third parties just as Google does.
Paradoxically, Facebook’s News Feed throttling actually makes life a bit easier for everyone in the ecosystem. After setting up their Pages many SMBs simply didn’t know exactly what to post or how often — what I’ve called “the Now What? problem.” But now the strategy is now simpler for SMBs and for third parties that want to sell social to them:
Set up a Page and add enhanced content; think of it as building a social version of the company’s website
Post product updates, new positive reviews from elsewhere, company news and/or promotions (periodically) and turn those into “Promoted Posts” (consistent activity is best; perhaps weekly or bi-weekly)
Buy locally targeted Facebook Ads (offer ads can be very successful and show clear ROI). Think of this as a key component of a mobile marketing strategy
Getting positive ratings and reviews is more challenging. But tactics are much clearer I think now: rich presence, occasional but regular posts that can come from elsewhere and Ads.
Third parties can set up the Page (which can include functionality like scheduling or commerce if appropriate) and they can also buy Ads and run campaigns on behalf of SMBs. Organic posting is still somewhat problematic but third parties can provide best practice guidelines that give SMBs a clearer sense of what to do, almost a template.
The ROI conversation should migrate to Ads exclusively (offline conversion metrics are key over the long term). Presence is necessary, ratings are necessary for consumer validation. Ads are where the ROI conversation should take place. This gets rid of the “is Facebook working?” and “are we wasting our time?” discussion that was linked to organic posting.
As an interesting aside, someone linked to an Alignable survey in the comments to the StreetFight article. I missed the survey in December when it came out. Of the 1,400 SMB respondents, only 14% said they would pay to promote their organic posts and another 18% said they weren’t sure. The rest (68%) said they wouldn’t pay.
Source: Alignable (12/14)
This week Facebook introduced P2P payments in Messenger. There’s some very interesting potential here.
Facebook could deliver payment services to SMBs (not unlike Square) if it wanted to. It could also buy a booking service (e.g., MyTime) and offer appointments and scheduling through the site. So there’s a great deal more than can be done on Facebook for SMBs to provide value and engage them.
Finally I’ve argued that until they develop a “local search” product (i.e., Places app) they’re not going to see SMBs motivated en masse to buy ads. I believe a local search consumer experience is key to helping SMBs clearly see value in Facebook advertising.
What are your thoughts on all this and where Facebook needs to go to convert more of its 30 million SMBs into advertisers?
In something of a surprise, last week Facebook announced it was buying shopping engine TheFind. TheFind will now shut down as its team joins Facebook.
Below is the statement that was posted on TheFind’s site:
For the last nine years, we’ve worked hard to bring you a shopping experience that’s easy, efficient and fun – searching all the stores on the web to find just the right products you’re looking to buy.
We are now starting our next chapter by combining forces with Facebook to do even more for consumers. Facebook’s resources and platform give us the opportunity to scale our expertise in product sourcing to the over 1 billion people that use the platform.
Key members of our team are joining the company and will be working hard to integrate our technology to make the ads you see on Facebook every day better and more relevant to you.
Unfortunately, this means we will be taking our search engine offline in the next few weeks.
Thank you for your loyalty and for making this a fun journey for all of us!
TheFind was one of the more innovative shopping search sites and brings a range of expertise and capabilities to Facebook. Yet Facebook may not use everything TheFind has to offer.
The official word from both sides is that the acquisition is about improving ads on Facebook. But TheFind could also help Facebook with Graph Search, Local and product search.
Facebook has flirted with commerce off and on since its inception. Several years ago there was an expectation that brands and retailers would be driving significant e-commerce off Facebook Pages. That didn’t materialize.
As Google and Amazon battle it out for shopping supremacy, Facebook could use TheFind’s infrastructure to build a product search marketplace. While this could distract from the focus on Facebook ads, why wouldn’t Facebook want to do this? Alternatively Facebook could continue to operate TheFind as a stand-alone site just as it does with Instagram and WhatsApp.
Graph Search remains an underdeveloped asset at Facebook. Engineers at TheFind could help improve and make Graph Search a better and more widely used offering. In addition TheFind could also help with place discovery/search (a neglected component of Graph Search) and even help Facebook develop the long-awaited Places app.
In my mind there are numerous possibilities and ways that TheFind team and its current product could be used by Facebook. While not everything about the acquisition has been completely figured out it does seem like TheFind won’t be fully “leveraged” in the narrow focus on ads. But maybe Facebook will surprise us.
What do you think? If you were running Facebook how would you utilize all TheFind’s capabilities?
As a final thought: the acquisition of TheFind marks a kind of conclusion to the “price comparison engine” era. While sites like Shopping.com (eBay), PriceGrabber, Nextag and others remain in existence, they haven’t built brands and the prominence of these sites has faded dramatically. They’ve largely disappeared from the Top 50 sites.
Now it’s really a battle between Amazon, eBay (to a lesser degree), Google and individual branded retailers such as Wal-Mart and Target.
We knew the day would come and now it’s here. New LSA consumer research shows that mobile devices (mostly smartphones) are now used more often for local search and to find local information than PCs.
Here’s the specific finding: 60% of US adults now typically choose smartphones or tablets over PCs to find information before buying products and services offline.
Device most commonly used when looking for location information online
Lots of individual company data that have pointed to this for awhile. For example, Yelp’s previous disclosure that 60% of its search volume comes from mobile.
The new report in which these data are presented is called Mobile Fanatics – How Mobile is Transforming Local Shopping. There are many interesting findings, including that the most engaged mobile users (“mobile fanatics”) conduct at least 10 searches per week on at least two devices from multiple locations.
These highly engaged mobile users — representing 43 percent of the US mobile user population — are more receptive to and more influenced by mobile advertising than conventional mobile users. According to the data, 70% of “Mobile Fanatics” who view mobile ads make a purchase and 80% of them buy within 72 hours of ad exposure.
Has viewing/clicking on a mobile ad ever provided you with information that has prompted a purchase?
So what’s the big picture? Why does this matter? All the same stuff I always say: trillions in product spending and services revenue happen offline and increasing amounts of that are influenced by the internet. Annual retail spending alone is a more than $4 trillion market.
US GDP last year was nearly $18 trillion. Roughly 70% of that is consumer spending. E-commerce is just over $300 billion. The rest is offline/local. That’s the market.
Accordingly, more and more offline spending is going to be influenced by mobile internet access and mobile advertising. This is the “why of local” that most marketers, brands and agencies still don’t fully understand — the online to offline connection.
The study was conducted for the LSA by Thrive Analytics. The survey was fielded earlier this year with a sample size of of 2,147 US adults.
There are probably too many local conferences. I know, I’m charged with planning some of them — and speaking at many of them. The content is typically similar, the speakers and issues are often very similar.
While it’s great for industry education and networking on the one hand, there’s also what I’d call “local conference fatigue.” However, given the built-in need to address many of the “bread and butter” local issues in programming LSA|15 (April 20 – 22, in LA), my challenge was how to inject interesting new angles and content into the show.
We in the “local search industry” speak at length about SMBs, often without speaking directly to them. So, together with GoDaddy, Yelp, Yahoo, Google, Closely, Square and Pinterest, we’re going to bring 200+ SMBs into a room and engage them directly around both basic and difficult digital marketing questions.
A range of experts is going to offer conceptual and tactical advice. But we’ll also hear from business owners about their needs, desires and pain points. It will be a very interactive day.
Beyond the companies above, we’ve got a few slots for other exhibitors and a limited number of spots for “industry” attendees, who want to interact directly with small business owners.
We believe it will be a compelling event and an unusual opportunity for people in the industry. Below is the preliminary agenda, which is being slightly revised. Let me know if you’ve got any feedback or suggestions:
8:30 a.m. – 9:30 a.m.
9:30 a.m. – 9:40 a.m.
Welcome and Overview
9:40 a.m. – 9:50 a.m.
We Feel Your Pain
LSA will present survey data on challenges of being a small business in a noisy and confusing digital marketplace.
9:50 a.m. – 10:15 a.m.
Mistakes Were Made
Panelists will discuss the most common digital marketing mistakes they see and how to avoid them.
10:15 a.m. – 10:40 a.m.
Elements of a successful digital strategy How to think about and prioritize various digital media and marketing channels.
10:40 a.m. – 11:05 a.m.
Morning Coffee Break
11:05 a.m. – 11:50 a.m.
Morning Breakout Sessions
Digital Presence: Websites and SEO
Paid Search Basics and Best Practices
Email and Social Media
11:50 a.m. – 1:20 p.m.
Lunch and Networking
Birds of a feather + expo hall
1:20 p.m. – 1:50 p.m.
Business Owner Panel
A panel of local business owners discusses digital marketing strategies and lessons learned.
1:50 p.m. – 2:05 p.m.
Capturing the New Multi-screen Customer
Data presentation with practical takeaways.
2:05 p.m. – 2:50 p.m.
Afternoon Breakout Sessions
Mastering Reviews and Taking Control of Your Online Reputation
Calls, Clicks and Visits: Driving Mobile Leads
Payments, Bookings and Commerce
2:50 p.m. – 3:15 p.m.
Afternoon Coffee Break
3:15 p.m. – 3:40 p.m.
What’s Working How to measure digital success, determine ROI and figure out whether you’re getting your money’s worth.
3:40 p.m. – 4:00 p.m.
DIY vs. Do-It-for-Me
Which forms of digital marketing can you do yourself and when should you hire someone else?
Over the past couple of years something has changed. I’m on the receiving end of daily press releases, pitches, data dumps and studies. I probably receive 50 or more emails every day simply pitching stories, product announcements, press releases and other promotional email.
It has become relentlessness. It wasn’t always like this; the whole thing seems to have intensified in the past year or two.
I previously tried to respond to every email I received from a PR person — what we me being a “nice guy” and all. But given that most of the emails I get are essentially, Dear [insert name] . . . generic copy . . . let me arrange an interview with my client, I’ve stopped responding unless I’m definitely interested or I recognize the person has taken the time to address me as an individual.
If I don’t respond, often what happens next is a follow-up email: “Just making sure you saw my previous email.” And in the more recent past I’m starting to get phone calls from people. In other words, many people are “escalating” with the phone because they think their emails aren’t being seen or are being ignored — they’re right.
I feel sympathy for these folks who are expected to justify their fees by producing “clips” and “mentions.” Many seem increasingly under pressure, sometimes even desperate.
All this is a function of too many companies, with similar marketing and PR strategies, and too much overall noise in the marketplace. (Everybody now has a quarterly report or index they’re pushing.) It’s very difficult to tell companies apart from their pitches and claims. Even after talking to them it may still be tough to tell them apart (see graphic above).
This is also a challenge from a vendor or biz dev point of view. Who should we work with?
Recently I experienced this at the IAB Leadership meeting in Phoenix: lots of programmatic vendors and data providers making similar or nearly identical claims. Of course when one can truly get under the hood or see a product in action differences become apparent. But I’m not often in that situation.
As an aside, this is what SMBs confront too with all the competing sales claims and pitches they’re exposed to.
I don’t have a good solution or set of recommendations for the problems I’m describing, except that PR folks should stop the “shotgun” approach often taken. But breaking through all the noise is getting more and more difficult for everyone in the system: the client companies, their reps, analysts and tech journalists.
The other day I had my nearly 10-year old Honda Accord sedan serviced at my local Honda Dealer. Several days before I received a direct mail coupon (oil change, tire rotation), which promoted me to call for an appointment — old school.
When I got there, as you might imagine, hundreds of additional dollars of maintenance were called for — nearly paid for the mailing right there.
After I left my car, I declined their slow courtesy shuttle (“he’ll be back in a about 30 minutes”), instead taking Flywheel (poor taxi-industry imitation of Uber) back home. Later in the afternoon I Ubered back to the dealer. (Every time I take Uber I feel guilty and struggle with it.)
Upon my return to the dealer, paying for the work was more difficult and time consuming than it needed to be. The lead technician who had checked me in that morning was nowhere to be found; and the people “in the office” confused me with someone else (telling me my wife had already paid — sounds good, too bad it wasn’t true). The repair paperwork was surprisingly difficult to read and understand, not at all user friendly.
I paid with a credit card in the usual manner and waited for them to “bring my car down.” While I was waiting, I said to one of the women helping me, “You know, you guys should really develop an app. It would help with scheduling, maintenance reminders and loyalty and you could even incorporate payments and invoicing into it.”
She looked at me as though I had been speaking Mandarin. Then she shrugged and said, “Wha . . . I guess, I don’t know.” Clearly she was not invested in the success of the business.
I thought about finding a more senior person and explaining the benefits of having an app but decided it wasn’t worth the energy and effort.
I know there are apps such as RepairPal; however it makes sense for a dealer like this to have its own maintenance app. The challenge is finding someone to build it and making sure that the finished product isn’t weak and therefore a waste.
I report this story because it was an illustration of the “inertia” that afflicts many SMBs as well as the built-in resistance to doing something different and potentially beneficial, though seemingly optional. It seemed a perfect microcosm of the larger small business marketplace.
While the non-profit Better Business Bureau (BBB) may still have some relevance to some consumers and businesses in terms of dispute resolution, its brand has become almost totally diluted and irrelevant in the digitally dominated world of local business search.
For years there has been a dormant opportunity for BBB to do something online that would reinsert the organization into the process by which consumers seek and find local businesses. As a modest example of such an effort, BBB has now done a deal with home services directory site Porch.
This is not game changing for either side. It appears that the BBB rating will appear on listings in Porch search results. This may be a licensing or revenue sharing deal.
At one point several years ago I had a discussion with someone about how BBB might become a more widely used directory or search site for local businesses. It has made some effort in that direction but offers a user experience that is mostly inferior to leading local search sites. And absent some major brand-building, it’s not going to be a consumer destination — though perhaps a stronger, more consumer-oriented mobile app would help.
Without a strong brand, BBB is playing an SEO game, which it’s bound to lose. What the BBB may not fully realize is that in the digital world and with younger users it has almost no brand equity. The organization needs to aggressively promote its brand, ratings and dispute resolution services to regain some visibility. As part of that, it should also seek to become more widely used consumer source for local business information.
If I were advising them, I’d argue for an app consisting exclusively of A and A+ rated businesses. What would you recommend if you were advising BBB about its future direction and regaining relevance?
Yelp has sued a company called “Revleap” that says it will deliver 4 or 5 star reviews on Yelp while withholding reviews of three stars or below in “the control center for your quality control.” To many business owners this sounds like the answer to the unending challenge of gaining a steady stream of positive customer reviews.
The lawsuit presents a range of claims against Revleap, including trademark infringement, unfair competition and false advertising. Yelp contends the company is not only violating its own terms but completely scamming business owners:
Revleap, which has cycled through various names including “Yelpdirector” and “Revpley,” has spammed businesses with unsolicited messages claiming that they can get good reviews to stick and remove bad reviews. One thing Revleap actually does, it seems, is bombard their clients’ customers with surveys. Customers that respond favorably, and agree to post a review, are entered in a drawing for gift cards in an effort to deceptively boost their clients’ reputations.
Revleap’s business model is the sort of thing that can put small businesses at risk with respect to our Consumer Alert program and federal and state regulators who often crack down on businesses that try to artificially inflate their online reputations.
Reviewing the collateral on Revleap’s site, it’s clear the company is misrepresenting what can be done (e.g., removal of negative Yelp reviews). However Revleap appears to be following many practices that are pretty common: using post-purchase customer surveys to identify positive experiences and then selectively posting or asking for reviews to be posted on key sites. Entry into a prize drawing is used to encourage positive reviewers to post on Yelp.
There are others in the market that use or have used drawings and contests to encourage review writing and posting. Drawings and other compensated or incentivized reviews like this are prohibited by Yelp because ultimately they may distort consumer opinions. Yet many use them and see nothing wrong here because there isn’t a 1:1 quid pro quo.
Revleap appears to operate on the darker end of an ethical gray zone around reviews. Companies like this capitalize (literally) on SMB ignorance, frustration — even desperation. Reviews have become a critical part of online marketing but there remains confusion about how to collect them and what’s permissible, especially regarding Yelp.
There are many ethical firms out there monitoring reviews and many that seek help SMBs collect and distribute reviews online. Among them are Reputation.com, GetFiveStars, Customer Lobby, Refgo, Review Pro, Grade.us and others. I don’t know the workings of all these companies but the ones that I’ve spoken to seek to do things in an ethical way.
Different consumer sites have varying rules or standards about collecting or soliciting reviews, with Yelp being probably the most strict. Other sites or programs are more lax. I don’t think Facebook has many consumer guidelines, if any, for local business reviews. And Google provides various high-level incentives (or used to) for Local Guides to write reviews (membership, access to Google swag).
Accordingly there’s not a ton of consistency among top review sites, which is a problem for SMBs. Because what may be OK for Tripadvisor, Google or Facebook may or may not be OK for Yelp or Angie’s List. Ideally there would be a set of clear standards that everybody adheres to or substantially adheres to.
I don’t see that happening soon. Unless or until it does there will be many companies that prey on frustrated, indignant or unsuspecting SMBs who simply want to address what is a very real challenge and very real imperative in the market — influencing and advancing their online reputations.
I’m very pleased with the group of speakers that have come together for the SMX West Local Search Advantage workshop on March 2. My view is that every person thinking about going to SMX West should be in this session.
It’s going to be a great day of tactical and practical information addressing a broad range of issues: SEO, Maps, SEM (local and mobile), reputation, tools, video, offline attribution and more.
Here’s the lineup of speakers and their sessions:
Google My Business: Everything You Need to Know Now Joy Hawkins Product Consultant @Imprezzio Marketing and Google My Business Top Contributor
Local SEO Strategy & Key Tactics (Bonus: Apple Maps Clinic) Adam Dorfman, SVP Product & Technology, SIM Partners Andrew Shotland, LocalSEOGuide
Driving and Tracking Online-to-Offline Conversions Michael Mire, Co-founder SweetIQ
Executing a Winning Local-Social Strategy Kelley O. Williams, Director the Honey Bee Company
Building or Fixing Your Online Reputation Chris Silver Smith, President Argent Media
Mobile SEO, SEM and Attribution Jaclyn Jordan, Senior Paid Search Strategist at WordStream
New Rules for Local-Mobile Search John Busby, SVP Marchex
Top Tools for Local Marketers Conrad Saam, General Manager Atticus Marketing
Leveraging Video for Local Lead Generation Mat Siltala, Founder & President Avalaunch Media
Managing Multiple Locations: the In-House Perspective
Derik Beck, VP of Digital Marketing, Cottman Transmission and Total Auto Care
Heath Bradbury, eBusiness Marketing Manager, Advance Auto Parts
There are local and mobile sessions in the main conference but this content will be more focused and tailored specifically to the needs and interests of local agencies and national-local marketers. Much of the content will be more advanced and specific.
Register today. If you send your team you’ll also save between 15% and 35%. Individual attendees can get 10% off with discount code: WS-LSA10.