1. MANAGEMENT INFORMATION SYSTEMS
GROUP 7 | INÊS OLIVA | JOÃO LAMARÃO | NUNO LOURISELA | RICARDO CANAS

2. AGENDA
Industry Analysis
Market Trends
Porter 5 Forces
Yelp
Business Model
Competition
Competitive Advantage
Value Chain
Revenue Model
The Future

3. INDUSTRY
A N A LY S I S

4. INDUSTRY
A N A LYS I S
ONLINE LOCAL BUSINESS RATINGS AND REVIEWS PLATFORMS
These days, you’re dealing
Every business wins and With so many businesses to with an educated customer
loses new customers every choose from, being number who does their research
day before the potential one on Google is almost and does not care what you
customer even sets foot out never the only deciding have to say about your
the door. credibility or trust factor. business: they care what
others have to say.
Welcome to the word-of-mouth marketing

5. INDUSTRY
A N A LYS I S
52% said that positive 16% of consumers said
72% of consumers trust
online reviews make them they used the Internet
online reviews as much as
more likely to use the local every week to find local
personal recommendations
business businesses (vs. 9% in 2010)
27% of consumers There’s a decline in the The continued growth of
regularly use online number of reviews being mobile internet usage
reviews to determine read by consumers – they suggests that more and
whether a local business is are forming opinions more consumers will be
a good business (vs. 22% in faster and trusting reviews searching and finding local
2010) more. businesses online

6. INDUSTRY
A N A LYS I S

7. YELP

8. YELP
an online platform with ratings
and reviews of local businesses

9. YELP
Connecting people with
great local businesses
Businesses, both small and large, use our
platform to engage with consumers at the
critical moment when they are deciding where
to spend their money.

10. YELP
Founded in 2004 to help find great local businesses like dentists and mechanics, and
can be used to find events, lists and to talk with other yelpers
Every business
As of January owner (or
2013, Yelp In 2012, the Yelpers have manager) can
reached 100 mobile app was written over 36 setup a free
million unique used by 9.2 million local account to post
visitors on its million people reviews photos, video
website and message
his customers
Yelp makes money by
You can access Yelp via Yelp is traded on the
selling ads to local
iOS, Android, Blackberry New York Stock Exchange
businesses and brand
and other mobile OS’s
advertising

11. YELP

12. YELP
Net loss for the
full year of
Total net 2012 was $19.1
revenue of million, or $0.3 Active local Average Cumulative
2012 was $137. 5 per business monthly unique reviews grew
6 million, an share, compare accounts grew visitors grew 45% year over
increase of 65% d to a net loss 68% year over 31% year over year
compared of $16.9 year year
to $83.3 million, or $1.1
million in 2011 0 per share, for
the comparable
period in 2011

13. YELP
TECHNOLOGY
Search and Ranking Technology Review Filter Mobile Solutions
Network Security Internal Management Systems

14. YELP
ARCHITECTURE
EAI – Enterprise Application Integration
ERP CRM SCM

15. YELP

16. YELP
SELLING ADS TO
80% 15% 5%
Local businesses Brands Others

17. YELP

18. YELP
TARGETED LOCAL ADVERTISING
Advertise on Yelp Advertise on related Removal of
search businesses competitor ads

19. YELP
Integrated
Mobile Ad
2012 Q4 Total Yelp Searches
9.2M Mobile devices

20. YELP

21. YELP

22. YELP

23. YELP
Key Partnerships Key Activities Value Propositions Customer Relationships Customer Segments
Screening
Reviews
Software Costumers Local Business
Development Profiles
Giving the
Microsoft’s opportunity for
Bing Local Business to
IT
Infrastructure Advertise
Key Resources Channels
Companies
IT Internet
Infrastructure
Facebook Advertising for
companies
Software
Cost Structure Revenue Streams
Staff Selling adds to
Local business
IT infrastructure Brand
Advertisement

24. YELP
Human Resource Management
Firm Infrastructure High qualified workers
Human Resource Management Technology
Research & Development – most
important function to be always
Technology
improving
Procurement Operations
Using the activities developed at the
stages of support activities will
Outbound Logistics
Marketing & Sales
Inbound Logistics
Service
promote the final service
Operations
Service
activities that maintain and enhance
the product's value including
customer support (feedback
and advice)

25. YELP

26. YELP
Coverage
Review Trust
Search rating system
Community style
Easy to use/design
Connection with other platforms

27. YELP
VALUABLE Free handy guide for local businesses.
Not many platforms have so many user-generated
RARE reviews.
Yelpers experience – not a mobile-only experience
INIMITABLE (content provides website engagement)
NON-SUBSTITUTABLE Industry/Sector coverage

28. YELP
STRENGTHS WEAKNESSES
 100 million monthly users (network effect)  Potentially legitimate reviews caught in
 Users generate the content Yelp’s review filter
 Low costs (operational)  Revenue model
 Local reviews aligned with social network  Their customers (small businesses) have
 Peer feedback mechanisms limited budgets to spend on advertisement
 Placement of the popular reviews  Low switching costs (small businesses can
 Integration with mobile devices change easily to Google or Facebook ads)
 Augmented reality
 Mobile monetization
OPPORTUNITIES T H R E AT S
 Entering new markets  Lawsuits
 Developing their social network platform  Privacy issues
 Gamification through augmented reality  Facebook and Google competition

29. THE FUTURE

30. THE FUTURE
Europe - Portugal, Greece, Czech Republic, Hungary, Luxembourg and Russia
South America – Brazil, Ecuador, Colombia, Chile and Peru
Asia – China, Japan and Macau

31. THE FUTURE
1. From review provider to a social platform
2. Brand Advertising
3. Platform Expansion
4. E-Commerce
5. Mobile Monetization

32. THE FUTURE
1. From review provider to a social platform
More
Intensified user More interaction
contribution to
engagement between them
the site
Incremental reviews, photos, etc.
 Increased user traffic in the platform
 Gain momentum
 Create network effect

33. THE FUTURE
2. Brand Advertising
It is a big revenue potential
Increased number of users engaged in the social Yelp platform will create the network effect
It will attract brand advertisers with big budgets
MORE MONEY

34. THE FUTURE
3. Platform Expansion – Key Platform Improvements
Social/User  Service offerings
Generated  More integrated check-in capabilities (checked in, bought X,
Content with friend Y, for event Z)
 Professionally written content
Editorial Content  Travel guides
 Visual and video content – Yelp Channel/Magazine
Expanded  Open up their website for 3rd party apps – let the users
Platform choose what they want to adopt

35. THE FUTURE
3. Platform Expansion – Key Platform Improvements
Social New
Check-in
network Review
capabilities
platforms Filter
Higher
conversion
rate
Increased
revenues

36. THE FUTURE
?. Scenario Analysis
% Values ($M)
Local Business to Advertising Conversion Rate 4%
Local Business Revenues 80% 110,08
Brand Advertising Revenues 15% 20,64
Other Revenues 5% 6,88
Total Revenues 100% 137,6

37. THE FUTURE
?. Scenario Analysis
Pessimistic Most Likely Optimistic
Local Business to Advertising Conversion Rate 4,5% 6% 10%
Local Business Revenues 123,84 165,12 275,2
Revenues Increase 12,5% 50,0% 150,0%

38. THE FUTURE
4. E-Commerce
 Gift cards, ticketing for events, create their own
Deeper integration payment and loyalty solution
with merchants
and more creative
offers  They need to enter into the part of the transaction,
not just at the endpoints (discovery and review)

39. THE FUTURE
5. Mobile Monetization
Gamification
Mobile
through
Advertising
augmented reality

40. THANK YOU