Beyond 5 Stars: Foursquare Looks For A Smarter Way To Rate Businesses

We all understand the five-star rating system. But does it really provide us with valuable information? Foursquare says nay.

Foursquare is experimenting with a new ratings system that gives users more information about a particular business than the often-arbitrary five-star system employed by services such as Yelp.

A new feature in the latest version of the app will now show you a score from 1 to 10 next to the name of a business you discover through Explore, Foursquare's signature discovery tool that recommends nearby places you should visit. That number is supposed to be a smarter indication of how much people like a particular place than the typical star ratings system that doesn't really tell you a whole lot about why a particular business might be attractive to you.

We last caught up with Foursquare a couple of weeks ago when it opened up the web version of its Explore tool to people who aren't registered users, so anyone could use it to discover local recommendations. At the time, Foursquare head of search Andrew Hogue told me about the new ratings system, which repurposes a lot of the same signals Foursquare considers when it makes recommendations for you in Explore: tips, likes and dislikes, popularity, and what locals and regulars think all factor into that end number.

The dilemma of the five-star system is that although we're inherently familiar with them as the standard of rating everything from hotels to movies, it's difficult to glean valuable information from them. A restaurant that normally racks up four or five stars but received a couple of unwarranted one-star reviews along the way is different from a restaurant that customers consistently rate as being a mediocre-at-best dining experience. But both average out to roughly the same number of overall stars.

Google is another company that ran into ratings issues after its acquisition of Zagat, which employs its own highly niche 30-point ratings system. Last month, Search Engine Land reported Google was beginning to downplay the prominence of those 30-point scores in restaurant reviews, instead playing up a more universally understood sentiment scale that rated businesses from "Poor-Fair" to "Excellent."

Hogue said ratings are just one of several features Foursquare is working on that better reflect why people choose to visit certain businesses. For example, a forthcoming "Tourist Sights" feature will use information on where people like to visit when they're traveling far from home to come up with what Foursquare is tentatively calling an "authenticity score." That score will help Foursquare make more nuanced recommendations on where to go, such as which hole-in-the-wall bistros French nationals frequent when they're in New York. Another big initiative it's working on is trying to answer the question, "Where do people like me go?" If Foursquare is able to answer that question, this new ratings system--which, although an improvement over the five-star system, is still fairly nonspecific--could actually prove to be a high-value tool for users.

[Image: Flickr user Anant N S]

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