‘Bits’ Praises Yelp

The typically skeptical and cynical journalist-cum-analyst Saul Hansell at the NY Times praises and expounds on the virtues of Yelp:

One reason for Yelp’s success is that it focused on San Francisco in its first year. The new generation of Web workers took Yelp to be their entertainment bible, and that helped generate enough critical mass that others joined in. Now the Bay Area represents only 30 percent of Yelp activity, Mr. Stoppelman said. Los Angeles is second, followed by Chicago and New York.

The site is also popular, Mr. Stoppelman said, because Yelp has been slow to add advertising, and there still isn’t that much of it. There are no banner ads. Instead, Yelp uses some relatively subtle advertising formats: Businesses can pay to have their companies listed first on search pages (identified as a sponsored listing). And they can pay to add photos and a little other information to the page about their business. But revenue from these sources isn’t enough to make Yelp profitable, Mr. Stoppelman said.

Responding to criticism from business owners that some user reviews are unfair, Yelp also recently introduced a way for the business owner to send a message back to a reviewer. If the reviewer doesn’t choose to write back, the business owner can’t send a second message.

But Mr. Stoppelman said that the site deliberately tilts its rules to support the reviewers. “We put the community first, the consumer second and businesses third,” he said.

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