Reviews Web site Yelp's operations and business model analysis

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Beijing Time March 2 morning, the U.S. consumer review site Yelp confirmed IPO price of 15 U.S. dollars, higher than the previous 12-14 U.S. dollar issue will range. Yelp will be landing at the NYSE on March 2, with the ticker code "YELP", with a total of 7.15 million shares issued. According to the 15 dollar issue price, the Yelp financing amount is 107 million US dollars, and the market value will reach 898 million US dollars. Goldman Sachs is the main underwriter for the IPO, with Citigroup and Jefferiesgroup as deputy underwriters.

On the eve of the listing of Yelp, we will comb through the history of development, operations and business models, financial conditions and market challenges.

I. Development history

The internet has just entered the years of the 2000, the UGC model began to rise. The Wikipedia, founded in 2001, led to the subsequent emergence of a group of 2.0-form companies, based on user-provided content, forming information reorganization and retrieval.

2003, the public comment network was born in Shanghai. Yelp started in San Francisco in 2004. And at this point, comments on the site in the United States is not new, the establishment of the more than 10-year citysearch at the time of the United States, the Internet reviews the boss position, but also a number of new comments on the site is also being explored.

But new Yelp began to develop rapidly in the San Francisco area. Compared to the traditional comment site, Yelp has changed: first, the real user comments, especially focus on the "handful" of interested users to attract. Create accounts, fill resumes, add friends, write comments, is the basic action of Yelp users, and second, through various forms of user interaction, and give outstanding users "reward." Such a pattern quickly distinguishes Yelp from the Citysearch, which values expert commentary and waits for anonymous user reviews.

Yelp established the San Francisco market in its first year and became the Entertainment guide for a new generation of internet workers, and the first group of users began to bring a lot of content to Yelp. To this day, the San Francisco Bay Area still accounts for 30% of all Yelp activity. The next major local markets were Los Angeles, Chicago and New York.

2010 years ago, Yelp was not expanding fast, adding more than 10 new markets a year. In 2010, Yelp accelerated its expansion. In 2010 and 2011, 22 new local markets were added. As of the end of 2011, Yelp has a total of 71 local markets, of which 25 are located outside the United States. , including Canada, France and Germany and other European countries and Australia.

and to participate in the review of business services, Yelp has expanded from simple catering to life services, including dentists, mechanics, plumbers and so on.

Specific comments on the share, catering and shopping accounted for the largest, each accounted for 23%. Secondly, the family services, beauty self-cultivation and entertainment accounted for 10%,9% and 8% respectively.

II. Operational Strategies

It can be said that Yelp since its inception, is a social characteristic of the internet companies. Browse Yelp Home and merchant pages with the most intuitive impressions: 1 The length of the comment is impressive; 2 The home page does not see any purchase activity entrance, instead is the line activity entrance occupies the important part; 3 The elite user is very eye-catching, the user through to the comment itself and reviews the author's "Praise" and "" The interaction is frequent,

As Ceostoppelman says, "Yelp emphasizes the experience of the review itself, and it's more like a blog with a bit of fixed structure."

One of the most important ways to analyze Yelp's operational strategy is its social operations:

First look at how Yelp expands a new market: Before a new market is officially online, Yelp first builds local businesses ' personal home pages based on third party data, providing location information, reviews, photos, history, and more. When the official online, consumers can contribute their own comments, and add imperfect business information.

The question then is how to attract more consumers and local businesses. Yelp's strategy is to in every local market, hire a community manager (and, of course, locals), with the community manager in charge of raising Yelp's brand awareness, and developing local reviews of the author community, promoting the growth of the reviews by community development, and constantly attracting new users to contribute reviews.

The operation and training of the local community also includes comments on the style and wording, Yelp values the length of the comments and the description of the details, currently, the average length of Yelp all reviews is more than 100 words. If you are an app user, you can sign in, send a photo, and publish a simple quicktip, but the comments are not allowed because Yelp believes that mobile terminals are not suitable for writing full quality reviews.

In addition to online operations, the comment community also exists offline.

Like Yelp's slogan, Realpeoplerealreview,yelp encourages users to create their own social profiles, similar to a typical social networking site, where Yelp recommends their mailbox contacts to new users and suggests inviting other friends to join Yelp.

This kind of "realpeople" is respected, also in the user's search process, when you search a service, friends once comments will be recommended to you.

The user's personal home page records all of the comments that were written, Yelp friends, and the voting results (useful/interesting/cool) and praise tags (thanks/good pen/unusual/mark, etc.) accepted by these reviews.

By accumulating reviews, polls and accolades, Yelp's part reviews the author's development as an "elite user": With more friends, votes and accolades.

Under this "incentive", the elite users contribute more to the site, according to a survey from Northeastern University, Yelp currently about 44% of the comments are from this part of the elite users. To maintain user interest and loyalty, the Community Manager also organizes activities regularly online.

With close social relationships and community support, Yelp's user loyalty is far greater than any other comment site: According to the survey, only 4.8% of Citysearch users and 11.1% of yahoolocal users contributed more than 6 figures, while Yelp's number reached 65.8 %。