Recap: Yelp presentation
On May 13 & 14, WOMMA held its Word-of-Mouth Marketing University conference.
Below is a recap of a presentation from the conference.
Presentation:
Yelp: Empowering Consumers with Local Knowledge
Presenter said:
In kicking-off the Word of Mouth Marketing Association’s WOMM-U Conference, Geoff Donaker, chief operating officer at Yelp, said, “The Genie is out of the bottle. You’re better off joining the conversation, than not.” Conversations about local restaurants and businesses fuel Yelp’s business. Donaker described Yelp as, “local search powered by community.”
It is the online community that provides Yelp with over 6-million reviews of local restaurants and businesses. 21-million people last month used Yelp to decide which restaurant to visit, car mechanic to use, and spa to be pampered at. With its broad reach and deep reviews, Yelp is changing the game of small business marketing.
Donaker told the story of a local carpet cleaner who used to spend $100K on yellow page advertising. Thanks to all the new business generated by positive reviews on Yelp, this carpet cleaner no longer spends money on yellow page advertising. Instead, this business is spending much of its advertising budget on improving it’s customer service, resulting in more positive reviews on Yelp.
Donaker also discussed how businesses have a love/hate relationship with customer-driven reviews. Businesses love how great customer service is rewarded with positive reviews. However, they hate the loss of message control. That said, the positive to negative review ratio at Yelp stands at 6:1.
Audience tweeted:
@ErikNYC mentioned the beauty of Yelp’s customer-driven model is that “when the customer wins, the business wins.” Echoing sentiments from the presentation, @gamedayjreau tweeted, “It’s always about customer service at the end of the day.”
In response to a case study example of how negative reviews can become positive for businesses, @leslieforde commented, “It’s worth engaging vocal customers gently. Reaching out to angry customers can change negative perception.”
WOMMA says:
The love/hate relationship with customer-driven conversations is real. Word-of-mouth offline and online can not be controlled, only sparked. A business cannot ethically control what customers say about them. One of the best ways to spark word-of-mouth conversations is through delivering outstanding customer service and providing remarkable products.
For any business wanting to spark word-of-mouth conversations, it must first spend time and money to gain utmost confidence in their services and products. This confidence will give a business thick enough skin to withstand negative reviews as well as a solid foundation from which a virtuous cycle of positive reviews will fuel business growth.
Yelp does not disclose that all of a businesses reviews do not show up. Let’s say you got a hair cut and a business salon owner asks you to yelp it, you do and it is positive. However, you are not really into yelping online, you did it because you said you would… your review will not show on the business. Yelp does NOT show all the reviews (positive ones) but they do show all of the negative ones. As a marketing and pr firm, we do not recommend pushing yelp with any of our retail clients anymore due to this. Wastes the reviewers time and the business owners time. Sites like I’d Go Back (www.idgoback.com) and Merchant Circle do not arbitrarily display reviews. It is what it is. Look at Yelps Facebook page where people have complained and NO response. Yelp has no clue about social media. If they did they would truly let the chips fall - but they want to play with the chips at their own discretion. WOM and Yelp are not the same… and YELP will find out when more business owners figure out what they are doing manipulating business reviews.
Interestingly YELP’s Facebook page does not have any comments? They wiped them out. What does that tell you - they are trying to control what people say about them by deleting the comments of people not happy with how they run their business. Guess that says they can’t stand the heat!!
Not surprised.
Yelp has a clue about social media. If they didn’t, they wouldn’t have been able to build a community-driven and review-powered city guide. Is Yelp a perfect business? Do they do everything right? No. Clearly, you’ve highlighted areas Yelp could improve. Other instances of Yelp deleting and repositioning bad reviews have been alleged. I do not know enough about those situations to comment.
I do know enough to realize Yelp has the potential to reinvent yellow page advertising much like Craigslist reinvented classified advertising.
With layoffs recently at Yelp and their questionable business practices, I give them six more months. There are other “social media” sites out there where you can contribute and find legitimate reviews of businesses ~ Yelp is not one of them… if I had the time, Yelp would learn Motrin’s lesson… but I just watch out for our client’s and at this time, that’s enough.
Yelp’s findings about the positive to negative ratio (6:1) are highly consistent with what our firm, the Keller Fay Group, has found consistently for the past three years when looking at both offline and online conversation — brand conversations tend to be overwhelmingly positive. More specifically, ~65% of WOM is reported to be “mostly positive” by participants, nearly 8 times the percentage (~8%) who say the conversations are mostly negative. We agree, there is far more to be gained than lost in encouraging WOM.
Ed Keller