You’ve probably heard of Angie’s List by now. It’s an online review service containing crowd-sourced reviews of local businesses, focusing heavily on home and lawn care providers. While it claims to be a trustworthy resource that consumers can use to find reliable service providers, it has some questionable practices that lead us to understand it’s not as consumer-driven as it claims to be. In this edition of “Prospect Genius Reviews…,” we’ll explore how trustworthy Angie’s List actually is.
First, how does Angie’s List work? Based on consumer reviews, it grades businesses on a report-card-style scale from A to F. Criteria for reviews include price, quality of service, responsiveness, punctuality, and overall professionalism. While businesses aren’t required to pay to be included, Angie’s List has a paid membership requirement for consumers. They have to pay in order to view business ratings and leave reviews. Because these reviews come from paying members who have created individual profiles, the website has managed to eradicate the problems associated with anonymous authors that many other online review sites encounter. We see this as one of the few positive attributes of Angie’s List.
But while it makes sense to institute a membership fee for consumers for the sake of authenticity, we find it a tad dubious that they accept money from businesses as well. We aren’t the only ones. A September 2013 article in Forbes, titled “Why Consumer Reports Says You Can’t Trust Angie’s List,” states,
“[Angie’s List] makes a big point to say they’e consumer-driven, when in fact 70% of their revenue comes from advertising. It’s not advertising Coca Cola, it’s advertising from the companies they rate,” explained Jeff Blyskal, a senior editor for Consumer Reports. While companies do not pay to be listed on Angie’s List, companies can pay to appear higher up in the search results— which Blyskal believes compromises the validity of the Angie’s List sorting system.
Margot Gilman, a representative of Consumer Reports Money Adviser, reiterates this point: “We found that businesses with A or B ratings who also pay for advertising rise to the top of default search results on Angie’s List. It’s a big advantage.” In other words, businesses aren’t required to pay to be included, but the ones that do pay receive significant benefits. It’s no surprise that Angie’s List has focused the majority of its revenues on business advertisements.
This inevitably impacts the quality of results that consumers are presented with. Even though the favored businesses at the top of the list have ratings of A’s and B’s, there’s evidence that their ratings aren’t authentic. David Segal, author of New York Times article “A Complaint Registered, Then Expunged,” illuminates a troubling practice that Angie’s List uses to keep advertisers happy. Segal explains that when consumers post negative reviews about any of Angie’s List’s paying advertisers, Angie’s List representatives will intervene and settle the disputes to the consumers’ satisfaction. This may seem admirable, but here’s the twist: Once the disputes with paying advertisers are settled, the original negative reviews are deleted. Consumers are allowed to post new reviews, but these reviews cannot be negative, and the grade must be at least a B.
Segal theorizes that “Angie’s List doesn’t operate with a complete-narrative ethos because it would scare off advertisers.” For this reason, Prospect Genius reviews Angie’s List with great suspicion. Any online review site that claims to be at the service of consumers’ best interests should never favor payment over objectivity.
In the next edition of “Prospect Genius Reviews…,” we’ll take a look at Yodle, another online marketing company for small businesses.
