If you read this title and responded with a confused look and the response “What is Yelp?” then you’ve got a lot of catching up to do.  Forces have been at work that you didn’t even know about, and that can be a scary thing.

Yelp is an online review site for myriad small business, including restaurants, bars, retail stores, and and more.  Users post their reviews of these businesses, and many others read reviews to help them decide where to eat when dining out (in the case of restaurants).  This means Yelp could be helping or hurting you right now, depending on the nature of the reviews posted about your restaurant.  That gives them a unique power over the restaurants reviewed on the site, and has ultimately led to some major PR problems for the company, which I’ll get into later.

The problem is, anyone can post a positive or negative review about a restaurant on Yelp, and in the anonymous world of the internet, that means people can be particularly cruel when they voice their opinions.  This problem is compounded by restaurateur fears that a single review can sink their business, as was often the case in the days of powerful newspaper food editors.

Yelp started out by taking advantage of this situation by allowing restaurants to pay to have bad reviews suppressed and good reviews highlighted.  These “sponsorships” start at $150 per month and comprise Yelp’s primary source of revenue.  Recent events, including a class action lawsuit, have led the company to change their policies, but we’ll get into that part of the drama a little later.

Some restaurateurs love Yelp.  Their clientele use the site on a regular business and the favorable listings and review postings given to sponsors means a noticeable increase in business that more than justifies the cost per month.  Others view the monthly payment as necessary to prevent bad reviews from hurting business, and you can believe that no one likes having to pay to prevent people from saying bad things about you.