Will FaceBook Local Be the Yelp! Giant KIller?

Money Shot

The Group Shot

We have read the stories about Yelp! suing a lawyer in retaliation for him suing Yelp! and winning. Most of us who own small businesses have heard the other horror stories about good reviews disappearing and negative reviews being “recommended” when businesses stop paying Yelp! for ads. With so many reports of tactics like this, whether they are real or imagined, it is shocking there have not been shareholder lawsuits against Yelp at a bare minimum.

Well, actually there have been at least two so far. The appearance of impropriety is usually enough to spark a shareholder revolt. But now Yelp! has a lot more to worry about than  eating itself . Although no doubt, Yelp! has great lawyers who have so far, successfully avoided having a jury actually decide a case, the bad press Yelp! has gotten out of all of this, along with what consumers are able to see with their own eyes, has really left Yahoo!, Bing and other companies enamored with Yelp! at a decidedly negative disadvantage from our perspective. However, that has not stopped Yelp’s supporters and investors from rallying after they defeated their own stockholders in court for a second time. (Source.)

New More Trustworthy Consumer Review Site Models To Eclipse Yelp!?

No matter what it does lately, Yelp! has been slowing down.  Between a declining userbase and pay-for-play scandals. The review site hasn’t quite kicked the bucket yet. But with the advent of emerging internet business models, its age is showing. Much of this is due to Facebook’s new Professional] Services. This system of consumer-friendly reviews allows for maximum flexibility and the ability for a business or service to interact with its potential base.

Enter Facebook “Professional Services”

Facebook’s model is building, and hasn’t yet reached its potential. Facebook has gotten the opportunity to sit back, and watch Yelp! sue its customers, and selectively enforce its vague and ambiguous user guidelines, and has thus been able to make sure it develops a product that only reflects a positive consumer experience. Its Professional Services division is sleek and professional, almost bursting at the seams with creative energy. Facebook’s experience in collecting data will enable the company to offer truly individualized results that can result in higher consumer satisfaction.

  • Yelp! No Longer Revolutionary?

One of the key differences between Facebook’s model and Yelp’s is the foundation it rests upon. Facebook has been the trendsetter for targeted advertisement and collecting data on demography. Yelp is a proprietary model that almost seems out of place in the Web 3.0. Its model flourished around 2009 because of its revolutionary nature. However, only combined with the expertise of another revolutionary system, such as Facebook will it truly take off. The approach has picked up where many users complain that Yelp has left off and allowed a friendlier system to become more compatible with future needs.

PC Magazine had a rundown on the new product, referencing its massive reach and ambition. The new service has already gained traction in the media, with reviews and first impressions rolling in nearly every day. Facebook’s much larger consumer base, ease of use, and ubiquitous branding will be hard to beat. There is no guarantee that Facebook’s Professional Services will put Yelp in the ground. However, for the company already swirling in controversy and seemingly one foot in the grave, it could fulfill such a role. For new businesses or those just entering into the internet rating sweepstakes, the safer money appears to be on Facebook.

After seeing a fellow lawyer sued by Yelp! after he beat Yelp! in court, I immediately knew I was not interested in doing business with this company. The user guidelines alone show many many inconsistencies that makes any business owner who adds a reviewer as friend, or even reviews a company that the business is friends with, but ALSO does business with, a potential recipient of a lawsuit. Even having a client use your office computer to add a review subjects a business owner to a potential lawsuit by Yelp! Of course, it appears that these rules could be used as easy pre-textual reasons for Yelp! to sue someone Yelp! doesn’t like. This could be especially true if Yelp! retains a “Rambo” litigator. So far, it looks like Facebook could take all of this Yelp! negative energy and turn it into a victory for FB.

Posts by Michael Ehline

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