Why Social Media Kills the Competition:Yelp.com Case Study
I just came back from a trip to San Francisco. Apart from having a great time, I discovered a new social media site that just blew my mind and blows the competition away....
Yelp.com is not a new idea by any stretch of the imagination -- haven't reviews of local restaurants, nightlife, bars, businesses, etc. been done to death? Citysearch, for instance, founded in 1995 by idealab, would have cornered the market in local reviews, right?
We created Yelp expecting to find all these cool local businesses, and what we found was a bunch of cool local people (from the user generated documentary at the end of this article)
Yelp.com may not be as big as CitySearch yet, but at 2 years old it is growing at an enormous rate. Based upon my experience the quality and reliability of the reviews, it puts everything else in the shade.
I mean, I had never heard of Yelp before, and somehow ended up finding the most amazing sushi restaurant through it. The sushi restaurant I found, via Google's municipal wifi in Union Square (SF), was called "Sushi Zone", hardly visible from market street, only open 5pm to 10pm, and the line starts forming before 5. What a treat! The person I was standing in line next to said he had lived in San Francisco for several years before he found this place -- and I had only been there for 2 days! Brilliant.
Interestingly Sushi Zone garnered 77 reviews on Yelp, and a 4.5 out of 5 star rating. Citysearch, on the other hand, had only had 17 reviews, and although still a healthy 9.5 out of 10 rating. (Remember CitySearch is 11 years old, and Yelp is 2.)
Well, needless to say, my experience just led me to be curious as to how this site got so good so fast... in an area with some incredibly well-established players. Here's my summary of ideas that I think any social media effort needs to pay attention to:
It's about the people not the technology or the product
Sell out selectively and meaningfully
Reward the Behavior You Want to Encourage
What can I say, if you want the community to do good work then provide a mechanism to motivate good work. Too many organizations just reward and measure quantity, but if you reward and measure quality and you will get it back tenfold. Yelp has done an amazing job of measuring and rewarding the right things. Apart from counting the number of reviews members have done, Yelp gives special kudos for being the first person to review a location. That IMHO is a little stroke of genius as I'm sure the first review of a location is usually the hardest one to get
Get Bloggers Involved
The yelp widget provides a little map that bloggers can embed showing locations they have recently reviewed.
With 1.2 million incoming links from 14,000 blogs, according to Technorati, you establish quite a foot hold
Trust Should Be Built In
The mechanisms that reward good quality also raise the level of trust.
"We've created a trust mechanism with Yelp," Stoppelman says. "Customers can make the decision to patronize better businesses, and local businesses are able to compete with larger ones.
Be Passionate and Participate
If you and your employees are not part of the community then who is?
CEO Stoppelman spends two to three hours a day surfing the site, writing reviews and complimenting people. He said he's found gems like Red Box Sushi in the Tenderloin, Mefhil Indian Cuisine on Folsom and Canteen in Nob Hill.... thanks to other users.
Sell Out Selectively
Communities don't mind if you sell out as long as you do it with their interests at heart, we all know you've got to make a buck.
Yelp is also highly selective about the advertisements it will accept -- only businesses with a minimum of a 3-star user review rating are allowed. Though the privately held company has yet to turn a profit, 60 percent of yelpers are between the ages of 26-35, a highly desired demographic for advertisers. In November, Bessemer Ventures provided Yelp with $5 million -- its second round of funding.
What does all this add up to?
Well, if you do a search on Google for "yelp" the third search result is "Courtney P at http://courtney.yelp.com". Her profile provides a great example of what yelp does to build community and reward valuable participation. Courtney has reviewed 33 restaurants so far and according to the community at large 18 were Useful, 3 were Funny, and 8 were Cool. She has 36 friends, 2 fans, and 5 "firsts" (you get kudos if you are the first to review a restaurant). All of that adds up to being an "elite" member which I think gets you invited to some cool parties.
Want to know more about Yelp.com? Watch the user directed and created video:
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Comments
I agree with recognizing and rewarding good quality reviews - especially with the massive amount of unevenly written comments online
Re 'Yelp gives special kudos for being the first person to review a location." StyleHive does, as well and also reflects other loyalty and community value-building traits you characterized as valuable for a social network to thrive.
I´m new at yelp kind of sites, and I was wondering... do you (anyone who reads this) think "kudos" for being the first person to review some place is motivating enough to make them come again? basically, is this motivation enough for making people participate in this kind of sites? pls, feel free to comment about this... I´m really interesten on this matter.
What can I say, if you want the community to do good work then provide a mechanism to motivate good work. Too many organizations just reward and measure quantity, but if you reward and measure quality and you will get it back tenfold. Yelp has done an amazing job of measuring and rewarding the right things. Apart from counting the number of reviews members have done, Yelp gives special kudos for being the first person to review a location. That IMHO is a little stroke of genius as I'm sure the first review of a location is usually the hardest one to get
Comments
I agree with recognizing and rewarding good quality reviews - especially with the massive amount of unevenly written comments online
Re 'Yelp gives special kudos for being the first person to review a location." StyleHive does, as well and also reflects other loyalty and community value-building traits you characterized as valuable for a social network to thrive.
Posted by: Kare Anderson | 08.03.06
You're right, being an elite member does get you invited to some cool parties...with free booze! Yelp really dishes out the Ego Capital
Posted by: kadavy | 08.10.06
You build a great case for the openness that blogs and other democratic forms of good expression. Refreshing post!
Posted by: Ellen Weber | 08.12.06
I´m new at yelp kind of sites, and I was wondering... do you (anyone who reads this) think "kudos" for being the first person to review some place is motivating enough to make them come again? basically, is this motivation enough for making people participate in this kind of sites? pls, feel free to comment about this... I´m really interesten on this matter.
Posted by: nicolas | 09.09.06