Is Yelp Getting Better For Businesses?By: Chris Crum - June 30, 2013
Yelp has always been about helping local businesses find customers, and helping potential customers find local businesses of interest. Despite the general functionality of the service, there have been plenty of complaints from businesses who feel that Yelp has hurt their business more than helped it. The company has been making moves lately, which would seemingly make it an even more valuable tool for businesses, and it will be interesting to see if the controversies fade or linger and whether or not new ones arise.
Do you like the moves Yelp has been making? Do you feel like Yelp is becoming a better tool for businesses? Share your thoughts in the comments.
A few months ago, Yelp launched the Revenue Estimator tool. This lets local businesses compare their Yelp-driven business to the national average. It does the math by multiplying customer leads sent from Yelp each month by the business’s average revenue per customer lead. It also includes the average spend per customer for each business category for reference.
“We think this new tool will be helpful to business owners for two reasons,” Yelp said upon the tool’s release. “First, it helps quantify the revenue opportunity Yelp is already sending to each business. Second, it establishes a revenue baseline for prospective advertisers, from which they can later evaluate the impact of their investment in Yelp Ads.”
CEO Jeremy Stoppelman recently discussed plans for launching ecommerce tools for businesses.
Yelp goes “far beyond restaurants,” he said at the Le Web conference earlier this month. “I think the number one category right now is shopping, so boutiques, places to buy different things…and so it covers the full range…the Yellow Pages traditionally didn’t cover things like shopping and didn’t really cover things like restaurants, but Yelp obviously cover those pretty well, but goes into the traditional Yellow Pages categories too, like doctors and hair salons, and plumbers.”
Interviewer Loic Le Meur noted that the next logical step for the company could be to start actually selling products.
After saying, “mmm hmm” and nodding his head, Stoppelman added, “I think that is an interesting direction, and it’s one we’ve got a toe in the water, but I see a lot of potential, and that is, we have all these people that are essentially shopping online for something offline, and so why not offer those consumers a way to close the transaction? We already do that with OpenTable Top Tables, so you can book your reservation from your iPhone or your Android device.”
“This is an area that we’re interested in,” he added. The way to think about it is “Yelp as a platform,” he said.
“We’re aggregating all these consumers,” Stoppelman continued. “They’re doing their shopping today, and the problem is that they’re just not closing their transaction. And so you can imagine that you might be able to plug in services like OpenTable for all sorts of verticals, and that could be a really interesting business for us.”
Last week, Yelp launched a feature that encourages transactions. That didn’t take too long. It’s called the “Call to Action” feature, and is available to Yelp advertisers.
“It will allow biz owners to promote a desired transaction of their choosing directly on their Yelp business listing,” a spokesperson for Yelp told WebProNews. “For example, Ticketmaster, one of the companies we’re launching with, has been using the feature on Yelp listings for over 2,000 live entertainment venues to guide consumers seamlessly from Yelp directly to the Ticketmaster page where they can purchase tickets.”
“According to a recent BCG study, advertisers on Yelp report seeing an average of $23,000 in annual revenue from the site,” the company said in a blog post. “Yelp’s Call to Action feature, available now to Yelp advertisers, is designed to increase the revenue potential Yelp provides to business owners, with the ability to promote a specific action they’d like consumers to take. The Call to Action feature will take consumers seamlessly from a business’ Yelp listing to the the business’ own website to complete the transaction — be it scheduling an appointment, printing a coupon, buying tickets to see ‘N Sync (still holding out hope for a reunion tour!), or any other action a business wants to promote.”
Business owners who want to try out the new feature are advised to start at Yelp’s advertising page.
Even since then, Yelp has added another feature, adding user-uploaded photos in-line with review text on business reviews. Yelp matches the photos and reviews that are contributed by the same people and displays them together on the business’ Yelp page.
“We have always said that what sets Yelp apart from other review sites is our community of Yelpers who come to the site to contribute rich content,” said Yelp UI designer Allison Shaw. “Not only are they writing reviews about their experiences with all types of local businesses, they’re also uploading photos. We’re continually working to make the content on Yelp as helpful as possible for people looking to make a spending decision.”
This month, Yelp also started using more data for “nearby” suggestions in its iPhone app (the update will come to Android in the coming months). This makes Yelp a more effective local search tool for users. Suggestions are based not only on location, but also on previous Yelp check-ins, reviews, Yelp friends, time of day, weather, etc.
Today, Yelp shared some findings from a Nielsen survey, indicating that four out of five Yelp users visit the site when preparing to spend money at a local business.
“Why is this important?” asks Matt H., VP Revenue & Analytics at Yelp. “Because it reinforces what we already know – that Yelp users are searching for local businesses with the intent to spend money, and they’re using Yelp to decide where to do it. With a monthly average of 102 million unique visitors (as of Q1 2013), that’s a lot of spending power channeled through Yelp. In fact, just last week we introduced Call to Action, another new feature that helps business owners close this loop between discovering a business on Yelp and making a transaction.”
According to the survey, 99% of Yelp users have made a purchase at a business they found on Yelp, with nearly 90% of them doing so within a week.
Do you think Yelp is getting better for businesses? Let us know in the comments.