As quoted in the NYTimes today, a conversation with Yelp CEO Jeremy Stoppelman:
Q. So what’s the incentive to advertise on Yelp?
A. The primary thing our advertisers are purchasing is actually advertising. Depending on what your price level is, you get a certain number of impressions of those ads, both at the top of search and on related business pages. So if you’re an Italian restaurant you might show up on a pizza restaurant page or another Italian restaurant page. Beyond that, there are also a couple of enhancements that happen on your business page. You’re buying out that ad inventory that would otherwise be on your page. You get a slide show so the photos on your page are a little bigger and rotate. You also get to highlight one review, which is clearly marked as your favorite. That’s it.
I think these advertising options aren’t compelling . There’s nothing classy about advertising your Italian restaurant on another Italian restaurant’s page. Why not allow relevant retail shops to choose particular restaurant pages to advertise on? For example, the florist next door to the sandwich shop or the luxury watch shop down the street from the fancy 5-star restaurant. Why not facilitate these potentially symbiotic relationships? There are long-lasting, productive–I’ll say it, lucrative!–synergies between retail, services and restaurants just waiting to happen. Yelp’s data could facilitate this–plus some community-oriented web apps.
We’ve got to get past the advertising-only rev stream for local content providers.
I wonder: for a given, restaurant, how much of their traffic is from Yelp? If Yelp could say, we drive on average 20% of traffic to restaurants in the Bay Area–they could charge for that. Most definitely.