Yelp Company`s Strategy

YelpCompany’s Strategy

YelpCompany’s Strategy

YelpInc. is a business platform located in California and founded in theyear 2004. It connects ventures with different markets in the UnitedStates of America. The platform deals with an array of businessesincluding beauty services, restaurants, entertainment, fitness, artamong others. The company majors in local advertising that includeboth free and paid listings to businesses of various sizes (Sussmanet al., 2014). The idea helps the businesses to find their requiredtarget audience and complete their mission. Many businesses haveexpanded their market segment in the country courtesy of Yelp. Thecompany has customers from various parts of the world, and it is aleading advertising and marketing platform in the country.

Likeall business ventures, Yelp has a management structure that aims atmaking the objectives of the company a reality through the setting ofvarious strategic plans. The generic approach use by the company is acomprehensive set of goals that represents its actual purpose in theindustry (Yelp Inc., 2015). The nature of its operation bringstogether manufacturers and customers. In the process of giving them aplatform to meet, the company earns profits for the services itoffers. For this reason, the strategic plans f the company revolvesaround customer satisfaction, financial sustainability, operationalenhancement and learning facilitation.

TheCompany’s Strong Strategy

Oneof the most imperative strategies that the company instituted andtheta has successfully led to its expansion is creating a reputation.The marketing and advertising industry is one of the mostconcentrated in the world. Customers tend to use the platforms thatthey can trusts and those with proven results. After its inception in2004, the pioneers identified the need to become and remain relevantin the market by marinating a high profile that would be the choiceof many manufacturers and customers. One way of creating such aprofile was through the provision of customized mean of accessing theproducts and customers for customers in the different regions (Moyer,2010).

Thefounders developed social platforms where yelpers could meet andshare ideas. In this platform, a business owner or group can create afree account and post photos of the products or the services theyoffer and give a message to their intended customers. When customersopen the website, they can find a list f all the advertised goods andservices and contact the producers of their choice depending on theirtastes and preferences. The platform includes both paying andnon-paying users (Yelp Inc., 2015).Paying users can change theinformation regarding their products anytime they wish so that it canreflect the intended image. The idea makes Yelp a very popular sitefor many businesses and customers. They can give or deriveinformation about their preferred services and products instead ofrelying on second-hand information from opinion makes (Moyer, 2010).

Anotherimportant aspect that helps the company to have a great reputation isthe use of automated software for data collection. It collects theopinions of people`s and ranks the service providers on the basis ofthe reviews given by the customers. When customers purchase goods,they comment on the website about the quality of the services orproducts (Michael, 2011).Companies with many positive reviews rankhigh, and customers find it easy when looking for reliable places toshop.

Thisstrategy has resulted in the company leading as one of the mostpopular in the country and other overseas countries. It boasts anaverage of 142 million visitors every month and the team has writtenabout 77 million reviews about various products and services offeredin the country. Only a few companies enjoy such a high traffic ofonline users (Michael, 2011).The strategy has been very imperative inincreasing the company’s profits because ventures will alwaystarget the sites with many users and present their products.

Strategythat May have Adverse Effects in Future

Yelp’smanagement goal is to reach as many users as possible. For thisreason, they targeted all the businesses in all the walks of life.However, their main emphasis was on small businesses that could bringin ready users. These ventures mainly deal beauty products andservices, health, nightlife, restaurants among others. The restaurantindustry is also highly concentrated with many small venturesoffering the same services. Out of all the businesses thatparticipate in the platform, 21% are restaurants and 24% major inbeauty services. Although these businesses have many customers, theydo not have a big budget to spend on advertising. Most of them arefree members who post their information without incurring costs(Michael, 2011).

Thestrategy has adverse effects on the competitive advantage of thecompany over others in the industry like Facebook and Google. Thesecompanies target blue chip companies who spend heavily onadvertising. Although Yelp enjoys many hits per minute that translateto hundreds of millions per month, the amount of revenue earned isnot equivalent to the number of visitors. Companies with seriousadvertising campaigns always look for platforms that have value andwhere their major competitors make camp (Witcher &amp Chau, 2010).The company, therefore, loses big companies who opt for other paidplatforms where others of the same caliber advertise their productsand services.

TheCompany’s Competitive Advantage

Currently,the company enjoys popularity and more than 140 million visitorsevery year. Although there s an intense completion in the market, thecompany has put measures to counter them through customizing theservices it renders to the users. The visitors can either use theirpersonal computers or use mobile downloadable applications that arecompatible with the various mobile operating services in the market(Kamerer, 2014).

Thecompany’s reputation has been very critical in helping it developthe customer base. There is an opportunity for the growing use ofonline advertising, but the company has to make efforts to target thebig companies that spend heavily on advertising. The main strategythat gives the company a competitive edge is the reputation it has inthe country due to its ability to automate reviews of differentcompanies. However, it needs a holistic approach to remain relevantin the industry.


Thesuccess of any business organizations rests with the efficiency ofthe management. The management handles driving the goal of theorganization and set the tone for the employees. The direction theygive has a direct impact on whether the company will fail or besuccessful in the implementation of the different strategies. Yelphas a management structure that reflects a diverse pool ofprofessional who had various departments according to their area ofprofession. The founder of the company, Jeremy Stoppleman heads thecompany, and this may explain the objective nature of the management.He has the vision of the company in mind and the outcome f making thecompany a leading platform in the world is one f his creations. Forthis reason, he leads a focused team that gives direction to morethan 3,000 employees who work for the company (Cyr, 2015).

Theteam comprises of the executive director, a senior vice president,and other vice presidents who head various departments and section.These include human resource, infrastructure, marketing, publicrelations, customers’ satisfaction, legal and compliance. The teamsupports the strategies of the activities in a mutual platform. Theymonitor and manage the huge number of employees who work to maximizethe results. The team has been very instrumental in building thereputation of the company by coming up with customer oriented methodsthat target total customer satisfaction (Cyr, 2015).

YelpCompany’s Policies and Practices

Themanagement of every company has a set of ethical practices andpolicies that govern its operations. All the employees working forthe company must fulfill these policies to avoid giving the company adetrimental reputation to the various stakeholders (Hill &amp Jones,2012). First, being an online company, the information that thecompany releases to the public should not compromise the individualcompanies’ security. The company only gives information meant forthe public domain. Customers cannot access confidential informationregarding the various companies in the platform. When opening anaccount, the advertisers access the privacy policies and thecommunication procedures. By signing up, they accept to allow thecompany to use the information to feed the customer base (Yelp Inc.,2015).

Secondly,the company only allows information that is for the generalpopulation. They filter out any information that may not be suitablefor children under the age of 13 years. The advertisers are aware ofthis provision, and they have a responsibility of adhering to thesocial responsibility (Yelp Inc., 2015).

Also,the company may use third party advertisers who provide the requiredservices. The third parties may access information about thecompanies through the platform. As part of their security measures,the company encrypts personal information regarding the companiesparticipating to prevent others from using the personal informationto their disadvantage. The information used in the automated reviewsis strictly from the customers, and the company does not in any wayinfluence the outcomes of the reviews. Due to the high number ofqueries and conflicts, the company has an efficient department tosettle the conflicts (Yelp Inc., 2015).

Thesepolicies and ethical standards have been the primary source of a goodreputation for the company. They form the basis for all theactivities of the company, and they guide a large number ofemployees. The privacy policy for an online company is a key elementin this business since companies do not want others to get criticalinformation about them since it can put them at a disadvantaged edge.People also prefer the company because they have the assurance thatthe information they get will be helpful and relevant.

Inconclusion, the strategy used by the company puts in a higher notchthan most online platforms in the company. The wide customer baseresults in millions of visits every month and the increasing trend inthe number of people who use it may translate into a bright futurefor the company. However, the management should come up with acomprehensive approach that attracts large companies that sendheavily in advertising. It will enable the company to withstandcompetition from big advertising platforms.


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Michael,L. (2011). Reviews, Reputation, and Revenue: The Case of Yelp.Harvard Business School NOM Unit Working Paper No. 12-016

Moyer,M. (2010). Manipulation of the crowd. ScientificAmerican,303(1),26-28.

Sussman,S., Garcia, R., Cruz, T. B., Baezconde-Garbanati, L., Pentz, M. A., &ampUnger, J. B. (2014). Consumers’ perceptions of vape shops inSouthern California: an analysis of online Yelp. Springer: New York.

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