Merchant Circle Reports 140,000 Sign-Ups, Continues Marketing Tactics

Merchant Circle threw itself a party last week at Nola’s in Palo Alto to celebrate a year in business and registration by 140,000 small businesses. I’m on their Evite list, so I knew about it. It is probably a good thing that some of their registered small businesses didn’t know about it, however. They might have come with knives (or worse!).

While the site actually offers a terrific set of free tools and services – truly – it continues to pump up its user base by auto-dialing small businesses and getting them to rush to their PCs to see what terrible things their customers apparently said about them. Of course, it is just a come-on. In many cases, there are no reviews, just a place to sign up.

I can’t imagine a list of disgusted small businesses is what cofounder Ben Smith was thinking when he started the site. At the time, he denounced the Yellow Pages as a “mafia” and vowed to be the true, tech-savvy friend of small businesses. His original concept was that local businesses, up and down the street, would sign each other up for the benefits (hence the “merchant circle”).

The letters I get on a regular basis would argue otherwise. Small-business owners are writing to me because they have no way of calling or writing to Merchant Circle to complain. Phone numbers and physical addresses don’t appear anywhere on the site.

“I got a phone call today at work,” writes Brian Smith, a barber known as the “long haired hippy.” “It was a recording that ‘claimed’ I had a review posted by one of my customers about the service at my barber shop. The recording went on to say that all I needed to do was log on to MerchantCircle.com and type in the business phone number. Then I could read this ‘review.’ Well, I typed in the number. Then the site told me that I had to register to read the review. This was free registration, or so it said. I will soon find out. So, I registered. There was no review. I had been tricked.”