Yelp advertising
Michael Zeisser, who is a senior vice president at Liberty Media, discussed how does social media amplify the effects of word of mouth in business. He indicates that "Behavior of users is mirrored by their networks of friends, amplifying the word of mouth effect and reflecting well on the underling brands.""As web sites evolve to become increasingly dynamic experiences that let people interact in real time, the value to core users of being recognized for their prominence in a community will only increase." Yelp/"大众点评" are the companies which combines ICT with word of mouth. Here is not only their friends, but also the strangers, shares their experiences and ideas about the restaurant or companies they have been. The communication of the companies will increase the publicity. The revenue of Yelp is $83.3 million in 2011 with a increase rate of 74%, 70% of the revenue is from the local advertising business (More information go to Media 360). Reviewed the business in every category on Yelp on September, 30, 2011, the restaurants account for 30%. (More information go to: http://www.smallbusinesssem.com/foursquare-the-webs-newest-local-search-engine-but-theres-one-big-question/5287/)According to "大众点评"’s experience, 20% of the users are enjoying the review of restaurant and the core users also affect the remaining users' behavior.
What is influence of Yelp/"大众点评" on restaurant business?
Reduce the cost of advertising. Especially, for the small and medium size restaurant companies, they do not have enough money to use the traditional adverting agency such as advertisement on TV or Video, TV show. The cost of advertising in Yelp/"大众点评" are much lower than the traditional ways.
Encourage the cooperation between the restaurant. On April 10, 2008, "大众点评" and Nanjing catering industry representatives announced 300 Nanjing catering enterprises will cooperate to build a food area for Nanjing citizens. (More information go to Enet IT news). The restaurants also provide the coupons or special offer in "大众点评". The share of information and communication create the business opportunity.
Investigate customer behavior, estimate the trend of the market. Both of the companies collected a lot of information about customer consumption. They also provides the information about the best restaurant customer reviewed, the top search restaurant, best dishes customer suggested, ect. All of these information will help the restaurant companies understand the customer behavior and improve their business.
New job opportunity. Since the development of "大众点评", the reviewers become more popular. Different from the traditional professional restaurant reviewer, there are some people who post very good comments on "大众点评" or blog frequently. The reviewers do not need professional knowledge about cooking or restaurant business. Some restaurant even give free try to the best reviewers when they have new dishes. Yelp also create a community for the metric reviewers to encourage the participation. More people are going to enjoy these.
Criticism of reviews. Yelp has been indicated that deleted or shield the bad comments from customers by paid. And "大众点评" also has been attacked by the malign comments. The public opinion could also influence the reputation of the restaurant, so the reliability of comments is considered more important.
More challenge for the restaurant.Customers can follow the information of the restaurant they liked. Compare to the traditional restaurant rating guide, the review is much more frequently. And it is much easier for customer to find the similar restaurant. Restaurant should try their best to improve their quality of food and service because of comparison.
Reference:
Michael Zeisser, Unlocking the elusive potential of social networks, McKinsey Quarterly
Media 360 (2012, March 5). Retrieved from http://www.chinamedia360.com/newspage/102311/79068439FCB3D905.html
Enet, IT news (2008, April 11). Retrieved from http://www.enet.com.cn/article/2008/0411/A20080411220680.shtml
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