The GeoMarketing Top 5 Countdown

Yelp is rumored to be shopping itself around. Reviewers think Yahoo would be the most natural fit.

Yelp loveFive years after it rejected an acquisition offer from Google, local guide platform Yelp is being shopped around to bankers, the WSJ reported this past week. What’s changed for the decade-old company? (Well, before we consider that, it should be noted that Yelp has made no comment on the report.)

For one thing, the company has achieved social media status as the primary local online reviews provider. But at the same time, its business model remains challenged. The main hurdle holding back profits and revenues has to do with a wider shift of people from desktop usage to mobile. Although mobile is finally regarded as essential for brands of all stripes, spending on smartphone ads continues to lag what’s spent on PC.

Beyond that, Peter Stabler, a Wells Fargo analyst, has seen Yelp manage the trials of local digital ad spending as well as could be expected. At the same time, investors are not known for their patience these days, especially in the tech stocks sector.

Reviews small businesses can use.
Reviews small businesses can use.

In essence, Stabler contends that “the packaged impression advertising model” — i.e., the traditional publishing sales method of charging advertisers based on how many eyeballs a placement can attract —  is far too expensive for local businesses. Therefore, Yelp “must transition to a CPC (cost per click) model to meet growth expectations,” Stabler said in a client note shortly after the WSJ story came out. “With that pivot underway, we believe Yelp is on a path toward building a more sustainable ad model. That said, we view the transition as a disruptive one that could reduce revenue visibility.”

While Yahoo, with CEO Marissa Mayer’s call for the aging portal to continue to double down on mobile products, is so far viewed as the most likely suitor for Yelp, though Google’s name is still mentioned among the list of potential acquirers. But the consensus on a Google offer is that the search giant has enough regulatory headaches at the moment. Plus, the changes to its own map and local business outreach has been ramping up without much need for Yelp’s vast local information system. Other big names being bruited about as giving Yelp a look include Facebook, Twitter, Apple, Priceline, Amazon, and Japanese marketing and commerce platform Rakutan.

“We believe the addition of Yelp would likely yield significant selling and traffic synergies and offer Yahoo an opportunity to expand its domestic and international footprint into the local market,” Stabler says. “On the technology side, we believe Yelp’s ad offering could be integrated into Yahoo’s Gemini platform that currently handles in-stream native and mobile search sales.”

And now, our favorite links from around the web:

Finally, onto our top stories from this week!

5. Target Aims Omnichannel Video Pitch To Consumers

Once viewed as a late adopter, the department store chain now notes that digitally-focused in-store shoppers are its most valuable customers.

4. Dos Toros Promotes New Opening With Social, Cinco de Mayo Specials


A $1 burrito offering has customers running for the Dos Toros door.

3. 4Info And Catalina Expand Measurement Pact On Mobile-To-Mortar Sales Lift

In-store traffic metrics are fine, but physical retailers just want to know if a smartphone impression actually made the cash register ring.

2. Opt-Intelligence Lifts Restaurant’s Direct Mail Relationships With Geo-Targeting

A display campaign for Granite Springs, NY’s Traditions 118 led to more than 18% of new subscribers redeeming their first coupon.

1. Thinknear: Mobile, Geo-Targeting Are Changing In-Store Shopper Marketing Strategies

Before mobile, shopper marketing started when a customer entered the store. But location advertising has expanded the connections beyond the physical environment, David Kaplan writes.

About The Author
Lauryn Chamberlain Lauryn Chamberlain @laurynchamberla

Lauryn Chamberlain is the Associate Editor of A New York City based journalist, she specializes in stories related to retail, dining, hospitality, and travel.