Nearly One-Fifth of Yelp Restaurant Reviews Are Phony, Shows Study

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Earlier this month it was reported that business review website Yelp had sued an individual who won against the company in small claims court. Julian McMillian, a San Diego lawyer, had sued Yelp over an ad deal. Yelp is now asking for $25,000 from McMillian for allegedly teaming with other lawyers in a scheme to plant fake good reviews on each others' Yelp pages.

That situation demonstrates just how serious Yelp is about protecting its image as an impartial source of business reviews. This, however, is at odds with business owners' desire for good reviews, which can make the difference in thousands of dollars in revenue. With so many shady SEO companies promising good Yelp reviews, Yelp has implemented one of the harshest filtering systems in social media. It's a system that often makes it the target of extortion claims from business owners who feel the company's advertising practices conflict with its filtering goals.

This week, a new study shows just why Yelp is so aggressive with its filtering and banning practices. The study, out of the Harvard Business School, is titled "Fake It Till You Make It: Reputation, Competition, and Yelp Review Fraud." It shows that a full 16% of Yelp restaurant reviews are potentially fake.

The study also found, naturally, that restaurants with already poor reputations are more likely to fake reviews. In addition, restaurants engaged in fierce competition are more likely to leave fake bad reviews for their competitors.

As consumer review websites grow in popularity, so will companies promising foolproof fraudulent reviews. Though the study does not speak on Yelp's advertising practices, it does shed light on just how challenging finding fake reviews is for the website and those like it. Barring some miracle algorithm that can perfectly identify fake reviews, the future of online reviews looks much the same as the current one: an ever-escalating battle between website filters and marketers.