Public comment Network Zhang: Yelp misses group buying and mobile internet opportunities

Zhang said: "If you do not enter the group buying business and mobile new platform, the public comments may already be listed

March 2, the U.S. shop reviews website Yelp.com is expected to log on to the NYSE, becoming the latest IPO in the United States, another Internet company. Yelp plans to issue 7.15 million shares, offering a price between 12 and 14 dollars. If the 14 dollar price is calculated, Yelp will raise 100 million dollars and value 838.6 million dollars. At the end of 2010, Google offered a takeover offer to Yelp, at a time when Yelp was valued at between 500 million and 800 million dollars.

"In fact, the value of Yelp is not very high. "February 24, the public comment Network CEO Zhang said to reporters that the main reason is that Yelp's advantage is only online information part, did not seize the opportunity to buy, in addition, Yelp on the phone has also been Foursquare impact," the two opportunities, Yelp did not seize. It also determines that its future growth will be squeezed by Groupon and Foursquare. ”

Public comment on the network than the founder of Yelp a year earlier, with the consumer to provide entertainment information business. However, around 2010, the public comment network has cut into mobile platform and group buying, began the "Yelp+foursquare+groupon" of the intersection and infiltration. "If not, the public comment network may also have been listed. "But with these decisions, it becomes a huge opportunity," Zhang said. According to Zhang revealed that two years ago the public comment Network did have to start the process of listing, but eventually chose to give up, and then expand the financing again.

Up to now, the public reviews the network has been a total of rounds of financing. 2006, its acquisition of Sequoia Capital Investment, the company valued at millions of U.S. dollars; May 2007, the public comments network to obtain Google investment, the value of tens of millions of U.S. dollars; last April, the public comment network announced the third round of financing completed, a total of credit capital, Sequoia Capital, Qiming Ventures and the speed of light venture invested 100 million of dollars. At this time, the value of the public comment network has reached 1 billion U.S. dollars.

"Yelp is not valued very much."

No chance to catch group buying and mobile internet

The public comment network and Yelp are actually focused on the O2O business model (online to Offline, that is, online to the offline). This is a new business model proposed by Alex Rampell, founder and CEO of TrialPay, the core idea is to bring online consumers to the reality of the offline merchants, consumers through on-line payment purchase offline goods and services, and then to the line to enjoy services.

"Founded in 2003, we are in the business model of the general logic of the idea is very clear, is to help businesses do marketing, but specifically how to do, it should be what products, we have been groping." "Zhang said.

At the end of 2005, membership card was the first company-level product identified by the founding team. Zhang and other found that many consumers go out to eat if the number of people to a certain number of merchants will be discounted discount behavior, the public comments network then introduced membership card. Consumer membership card into the public comment network of cooperative merchants, will be able to obtain a certain discount, and the public comment network through this card to achieve the collection and management of consumer and merchant information functions.

Membership card income of about millions of yuan, because the cost is very low, this income is also equivalent to net profit. "But then we thought it was a failed product because its business model was too round and not simple enough." Zhang said that next to the coupons and keywords from the beginning of 2007, the founding team saw a more concise business model of the product, "Yelp and other O2O mode in disguise is doing this thing."

As a result, the public comments network began to provide small and medium-sized service-oriented businesses overall marketing program, different marketing tools, including the provision of keyword search, electronic coupons, brand promotion, Business Circle search and interactive marketing. In other words, when a merchant needs to seek promotion, the public comments on the network will be based on the development phase of their enterprises to provide or single or packaged marketing recommendations.

and its starting from 2010 into the group buying business, like a chance and more likely inevitable. In 2009, Zhang had noticed that Groupon, the first time it appeared in the new media website of TechCrunch, was a cause of grief for TechCrunch's chief editor. At the time, TechCrunch, an important author to follow her husband to Chicago to resign, TechCrunch editor in the expression of Farewell to the Love will soon join a start-up company, this start-up is Groupon.

"It's enough to show how much Groupon was fading at the time, but no one would have thought that Groupon would soon be investing in it and became famous in the second half of 2010." And I did not expect that the domestic will follow up so quickly. Zhang revealed that, in fact, the founding team is still sorry to cut a bit late.

The reason for the delay, Zhang said, was that when the mass comment network judged it was more important to make a quick cut, "this is because the mobile platform is a new platform for the future, it can integrate and play our original business, and the group buying business is more like a tool and business model, and two strategies at the same time will lead to a weakening of the single strategy.

Now look back, the group buying business seems to be the public comment network business model is an inevitable extension, compared to other start from scratch site, it has to do Groupon mode of sufficient soil, such as the existing tens of millions of user resources and millions of of the merchant resources. Secondly, if the products are divided into physical and service-type two types, what Groupon does is the latter, but when the concept arrives in China, quite a number of physical product form sites are also born and competed, but compared to the latter, service-oriented products have a higher profit characteristics, and their upfront investment is usually fixed, For example, a restaurant or movie theater, any new consumption is generated by cash flow.

However, despite the above advantages, until 2010, the public comment on the network is formally cut into the field, and the "Yelp+foursquare+groupon" mode of exploration carried out up to 100 million U.S. dollars refinancing.

According to Analysys international analyst Shou sent the data, after a year of fighting, 2011 China Group buy market share four companies ranked as: Handle, the United States, the public comments network and litters. The data did not include Taobao's "poly-cost", which amounted to 23.7 billion yuan in the Chinese group buying market in 2010 and nearly half the cost of the family.

However, the advance layout of mobile platform, it does give the public comment on the network to bring huge space for imagination. "We will find that a few years ago the public had been less aware of the Internet applications of life-like information. Zhang pointed out that when the carrier is still in the PC era, busy high-end users may not use the public comment network.

Since then, can carry, everywhere to view the further popularization of mobile terminals, improve the user's penetration rate. At present, the public comment Network coupon download is already twice times the PC terminal, and by the end of this year from the public comments network mobile traffic is expected to exceed the PC end.

"Our focus this year, in addition to increasing the strength of group buying, another focus is the business model of new product development." "We expect the fourth and fifth new products based on mobile internet to appear this year," Zhang said. ”

The expansion logic of the public comment network

If we do not cut in to buy business and new mobile platform, we may have been listed

In short, the public comment network The future profit growth space is actually mainly from two aspects: on the one hand, continue to expand the number of merchants, on the other hand, the new marketing tools to seek and breakthrough. "Our goal this year is to develop the business from 1.5 million to tens, where we were mostly active in a first-tier city, but in the future it will deepen the permeability of tertiary cities," he said. "Zhang said.

The Yelp prospectus shows that Yelp achieved revenue of 83.3 million dollars in 2011, up 74% per cent year-on-year. As sales and product development spending increased by more than 50%, the net loss of Yelp in 2011 was expanded from 9.6 million U.S. dollars in 2010 to 16.7 million dollars. By the end of last year, the number of independent visitors to Yelp was 66 million, and currently there were about 25 million local shops commenting on the Yelp website.

In contrast, the public comment network up to 2011 the fourth quarter of the month active users more than 42 million, comments on nearly 20 million, the number of merchants more than 1.5 million.

However, Zhang declined to disclose the specific total revenue of last year's mass comment network. 2011 years, in charge of sales of the public comments Network co-founder, senior vice President Jing had to the reporter disclosed that the public comment on the net from the end of 2008 profit, 2009 revenue in 10 million U.S. dollars, 2010 close to 30 million U.S. dollars.

However, Zhang did not avoid the issue of listing. "I think for a business, usually the better time to go to market is to meet the two conditions, the first is the business model is relatively mature, such as when we have just entered the group buying business, the basic is not expected to the next quarter of the budget and revenue, because it can not be estimated, you do not know how to carry out earnings forecasts "Zhang said:" The second condition is that the company has sufficient management capacity to listing. ”

"If we don't cut into the group buying business and the new mobile platform, we may already be on the market, but with these two big increases it becomes a huge opportunity and there are big challenges in these opportunities." Zhang said that the public comment network more appropriate time to market should also have a two-year time.