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Does Yelp Help Grow Your Business?

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Amy’s Baking Company in Scottsdale, Arizona learned the hard way that the Internet is a double-edged sword. Scathing customer reviews led to a very well-publicized meltdown across three social networks and the TV show Kitchen Nightmares. The balance of power has completely shifted, now resting entirely in the hands of a capricious public. One of their main tools – or weapons – is Yelp, the review site that lets everyone detail their experiences for the world to see and take heed. With the awesome power wielded by the general public, owners are wondering: does Yelp help grow your business?

The Tools Of The Trade

The simple answer to that question is that it depends on the business. By their very nature, reviews are subjective, completely up to the discretion and experiences of the individual reviewer. Ideally, business owners can use Yelp reviews to address specific customer concerns and raise their own standards. When done properly, this can loop back, too: if people see that a business takes customer complaints seriously, and then takes step to improve their services to ensure that the issues behind those complaints are dealt with, it can bolster the business’s’ image and lead to greater investment and trust from the public.

In fact, the Boston Consulting Group found that small businesses that use Yelp found their annual revenue increasing by almost $8,000. It should be noted, however, that the survey that produced those results was funded by Yelp, who have repeatedly pointed to those results as evidence that when used properly, the service benefits everyone.

Bad Pennies Cost Big Money

However, the nature of social media – and Yelp, in particular – means that one reviewer having one bad day, or one isolated bad experience – can deliver a crushing blow to a business. The fickle nature of this power has not gone unnoticed: the Washington Post reports that over 700 businesses have filed complaints with the Federal Trade Commission over damages wrought by Yelp users gone on the offensive.

For example, a restaurant in Fairfax County had to defend itself against two “vengeful” Yelp users, despite claims that the users in question had never visited the restaurant. Lawsuits have been filed and police have been called in instances where business owners and Yelp users have aired their grievances in person. Naturally, the business damage done from such cases is immense and often irreparable.

Whether Yelp helps or hurts a business depends on the business itself and their customers. The social media element of the site ensures that bad reviews travel at the speed of light, perhaps unfairly so. For all the good that Yelp can do, all it takes is one unfavorable review – legit or not – to send a business’ reputation spiraling out of control.

Categories: Business
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