Executive Summary for Yelp • • Yelp’s Mission Statement: to connect people to great local businesses. Yelp has been in business since 2004 & had net revenue of $102.5 Million in Q3 of 2014, a 67% increase from a year earlier. Yelp serves 3 key constituents: • • Contributors that review Consumers that read the reviews • Local businesses Key Marketing Objectives - Grow the Yelp brand globally (currently selling in 8 countries). - Better connect with local businesses and attract new small business accounts. - Continue to improve mobile technology and make it easier for consumers and business to utilize the Yelp platform. Market Demand & Growth International Reviews International Visitors 8 35 7 30 6 25 5 20 4 M 3 M 15 10 2 1 5 0 0 Q3 '13 Q3 '14 -Yelp’s international reviews grew by 97% from Q3 of 2013 to Q3 of 2014. Q3 '13 Q3 '14 -Yelp saw a 40% increase in unique international visitors over that same time- frame. Drivers of Revenue The industry is highly competitive with low barriers of entry. The industry’s revenue drivers include: Local Advertising ›85% ›Local Advertising is the main driver of revenue. Brand Advertising ›10% ›Second Largest Driver of Revenue Other ›5% ›Gift Certificates and other initiatives. Industry Attractiveness Profit Potential High Low Low Segment C Businesses that are Segment A: large geographcal seeking low-cost, easy to use, and diverse consumers who use and effective advertising ratings and reviews sites to solutions to target a large search for local businesses. number on intent-driven consumers. Segment B: Customers who are new in town or traveloriented community. Industry Attractiveness High S.W.O.T. Analysis STRENGTHS • • • Yelp is user friendly and convenient. Yelp offers a platform for users to share information. High Growth Rates and Profitability • • Global Markets • New Acquisitions • New Products & Services Considering the popularity of Yelp, the crowd of consumers will attract more consumers. OPPORTUNITIES WEAKNESSES • • • • • Too many investments in research and development. Yelp is not a global web application. Negative reviews given by customers. This effects business relationship in a negative way. • Small business units. Competitors within the social review industry such as Google. Yelp services can easily be imitated, • External Business Risks • Financial Capacity • Government Regulations • Increasing Costs THREATS Strategic Market Plans (Direction) Improve Overall Market Share. Grow Small Business Account Relationships. Geographic expansion & Increased emphasis on Mobile technology. Market Attractiveness- Huge opportunities here and abroad. Competitive Position- Yelp is one of a few firm’s stealing market share here in the US. Positioning and Pricing Strategy Area of Performance Advantage Low Cost Content Supply Enables Yelp to have a higher gross profit margin. Traffic to desktop and mobile devices. 46% Increase in brand advertising to grow revenue. • Yelp is well positioned with its food delivery services and other value added services. Additionally, Yelp can offer goods at a lower price than its competitors by packaging value-added services with other key products. • Yelp can also gain a prominent position in the market by engaging in partnerships with top companies. This will allow Yelp to continue to expand internationally. Customer Needs Retail TouchPoints (RTP): Today’s consumer are empowered by the amount of liberation and resources they have access to via the web and mobile devices. Search Media Strategy Benefits: • Create open up-to-date communication channel with audience to better understand customer needs. • • Gain more visibility and increase traffic to your website throughSEO (Search Engine Optimization) and SMO. • • Build infrastructure to react promptly and courteously. Learn tools to instantly promote and launch new products and specials, last minute and web only deals. Stay connected with customer 24 hours a day and have the tools to spread your message around the globe. Marketing & Sales Budget 2013 & 2014 Through Q 3 2013 2014 Net Revenue $162.3m $267.6m Marketing & Sales Expense $93.123m $147.470m 57% 55% Marketing & Sales Expense as % of Revenues Net Revenues grew by 65% from Q3 of 2013 through Q3 of 2014 while proportionate dollars spent on Marketing & Sales declined by 2%. Marketing Profitability Impressive Year-Over-Year Growth in Several Key Metrics Reviews 64% Unique Monthly Visitors 67% Claimed Local Businesses 97% Active Local Advertisers 118% • User generated reviews give Yelp a network overtime it should get established in many more markets; in doing this, it will be able to sell its advertising to local businesses profitably. Yelp’s Network Effect- breadth & depth of customer reviews. “Plus/Delta “ Analysis Marketing Planning Process/Outcomes: In terms of working together well, we did a good job of splitting up the work equally and communicating with each other every step of the way. 1. We also made a point to verify the differences in the marketing planning process. Some components of the marketing strategy were very similar to one another. We made a point to make sure the differences were clearly seen from the very beginning. 2. Visuals were held in a high level of importance, and I think we worked well together in choosing the appropriate graphs or charts in illustrating this. 3. Working together as a team can be difficult in an online class, but in my opinion, I believe we did a great job in compiling significant information and presenting our parts in a cohesive and well designed manner. All of this shows in the outcome in every step of our marketing plan. In terms of things that we would probably have done differently next time: 1. Chosen a different industry, in order to gather more information for our power points. 2. Give more time to review over our work before it is submitted. I only say this because even though our work submitted for every part of the project has received good feedback; as a group we would feel more confident submitting an assignment after revising it several times.