The Art of Local Marketing: Becoming Selfie-Aware

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yelp-stickerIn the continued examination of local media, a handful of consumer-facing companies have reached legitimate success beyond vanity metrics and shiny new things. One of those companies is arguably Yelp.

Sort of like when your name reaches verb status, one mark of startup success is when people insert the word “killer” after your name to characterize a competitive entrant. This is also incidentally a mark of true hacksmanship within the tech press and analyst corps.

Though lazy, the “killer” designation follows a longstanding tenet of journalism (cue that damned inverted pyramid): “If it bleeds it leads.” Either way, “Yelp Killer” is the go-to reference for any new app remotely resembling local discovery.

The most recent example is the revamped Foursquare. The jury is still out on its scalability and I’ve grown to like it. But it’s no Yelp killer. For one thing, Yelp has 1000+ local ad sales reps — one of its biggest and most underrated assets.

I’ve long been bullish on Yelp for that and other reasons. And in the past month, a few things have shed more light on Yelp’s potential direction. This follows our deconstruction of its business model. Consider this part II of that writeup.

First were Q2 earnings, including $89 million in revenues (61% YoY growth), and $2.7 million net income (profitability for the first time). 40 percent of reviews from mobile also builds a defensible and investor-easing position amidst today’s mobile migration.

But more notable to me was Yelp’s underplayed launch of Vine-like functionality. This will give users the ability to capture and share short videos in and around local businesses. I won’t just dwell on this because I totally called it last year.

Rather, it fits into several macro trends. For one we’re in the age of social sharing a la Instagram, where capturing and sharing multimedia is a common use case. And Moore’s law-fueled growth in hardware, optics, and connectivity enable it.

This collides with the SMB opportunity in venues where social sharing is conducive. It shines particularly well in restaurants for example. And that’s where the selfie meets the road for Yelp. Remember, 40 percent of Yelp reviews already have a phone out.

We’re talking food pics or video of social antics. It’s already prevalent with Instagram: iPhone-toting hipster foodies, capturing that perfect Pliny the Elder pint, clad in Sutro filter. Characterize it how you like but it’s happening. And the key is in the tagging.

“We’re definitely seeing an uptick in consumers tagging photos to SMB locations via Instagram this year,” Perch CEO Perry Evans told me. “[They] communicate the most positive aspects of ambiance and products, so it’s a real opportunity to leverage in SMB marketing.”

The idea is that user activity is happening either way. So it’s a matter of harnessing it, which most SMBs won’t do on their own. But companies like Perch are glad to help them along, including dashboards to manage social activity. And Instagram itself is going there.

One big question is if Instagram (or Facebook) will be users’ tool of choice. Or will Yelp’s local-specific use case position it to take over what I’ll call the SMB selfie — or I guess it would be a “youie” (selfies of other things)? Evans’ bet is on the social incumbents for now.

“I think Instagram, and to a lesser extent Twitter/Vine, are where consumers will capture the moment,” he said. “Yelp will need to get creative to teach users why they should learn/use a different tool; especially when Instagram users’ networks are already in place.”

If Yelp can pull that off, multimedia happens to fit right in with its revenue model. At the paid tier, one of Yelp’s top offerings is the to create slideshows. Video will be the next step to let SMBs to capture their ambiance with greater dimension.

That could include SMBs selecting certain user-shot videos, giving them top billing or amplifying them. Either way, it’s going to be an important step for Yelp to maintain revenue growth, and of course to differentiate against so many homicidal startups.

speaker_MichaelBolandMichael Boland is chief analyst and VP of content at BIA/Kelsey. Previously, he was a tech journalist for Forbes, Red Herring, Business 2.0, and other outlets.

Mike Boland has been a tech & media analyst for the past two decades, specifically covering mobile, local, and emerging technologies. He has written for Street Fight since 2011. More can be seen at