inovation process
yenomrah
AD741Researchreport.pptx
Spring 2019 - 04/09/2019
Background Research
Founded in July 2004 by Jeremy Stoppelmanand Russel Simmons
It developed from the idea of bringing in person recommendations online
Over the years it has established itself as a leader in the area of community coverage.
It is now worth more than five billion dollars with over 130 million visitors each month.
Its tremendous growth is attributed to its evolving services
Market Research
•Yelps target are the business managers and owners
•These business owners use Yelp to access a market segment
•This is because it helps people find businesses that provide the best services such as dentists, restaurants.
•The company has a large market segment whereby by the fourth quarter of 2017, Yelp had 77 million users via desktop and 64 million users via mobile website per month.
•By the end of the year, it had 148 million reviews. Businesses use it to get consumers for their products and this makes it unique.
Yelp’s Business Model Analysis
The network effects
Customer Experience
Value proposition
Users
who read the reviews
Active reviewers
Local businesses
Content creators
The advertising revenue model
Yelp’s financial report in 2017
Advertising (89%)
Transaction (~9%)
Other (~2%)
Advertising
Increase revenue
Engage with a large audience
Online transactions
Business data
Delivery service
Discovery a local business
Informative tool
Promotions and rewards
Yelp Nowait
Space for people who enjoy social exchange and like to share their experience
Yelp’s obstacle and solution
Fake reviews
How Yelp fights back
2. Unfairly target businesses that don’t buy ads / Positive reviews were hidden if they didn’t pay
In 2013, a number of businesses got caught
Automatically uncover providers of fake reviews and investigate suspicious cases
Users can report an inappropriate review on Yelp’s website
Remove its users’ account if they engaged in misleading customers
How Yelp fights back
“Automated recommendation software weeds out reviews that might be biased or fake because a lack of information”
“There is no money that businesses can pay Yelp to manipulate their reviews”
Yelp said
SWOT Analysis
| Strengths: | Weaknesses: |
| *Strong network effects | *The marketing ability of users and customers is insufficient |
| *Innovative business models | *Business and product innovation capabilities are inadequate |
| Opportunities: | Threats: |
| *Advertising shifts from offline to online | *Fierce competition |
| *Online reviews are much more and more credible | *Business growth slowed down |
| *Mobile devices and applications are growing rapidly | *The profit outlook is uncertain |
Competitors
Trip advisor:
The world's leading travel website and providing reviews and recommendations from travellers around the world. Covering hotels, attractions, restaurants, airlines, travel planning and hotel, attractions, and restaurant reservations.
China development strategy.
Identify and block false reviews, identifying and preventing false reviews.
Revenue model: -Click-based advertising (CPC) & transaction revenues: 63%
- Display-based advertising (CPM) & subscription: $282m / $1.2b = 23.7%
- Other hotel revenues: $158m / $1.2b = 13.3%
.
competitors
Dianping :
One of the largest city living consumption guide websites in China. The three-party review mode is mainly for the review of food and beverage entertainment, sharing information platform.
6 promotion methods tailored: Group purchasing , coupon, keywords, sign in, City link.
Revenue model: commision revenue, E-commerce, offline services, wireless
value added, online advertising
Little red book:
Is a lifestyle platform and consumer decision entry, allows users to post and share product reviews, travel blogs and lifestyle stories through short videos and photos
Improve user experience by accurately matching big data and artificial
intelligence content to users interested in it.
Revenue model: Advertising + e-commerce + value-added services
How can yelp be improved
Deep market research either using a big Data Studies or Market Surveys
Rank results based on qualitative attributes that users care about
Image search
An image search feature that enables users to search for providers based on a photo of the household item that needs fixing
Internal controls
Addressing fake review
Make more narrow rankings possible
ambiance, service, and food.
Reference
“Yelp: Re-Accelerating Growth.” Digital Innovation and Transformation, digit.hbs.org/submission/yelp-re-accelerating-growth/.
Porat, Alon. “How Does Yelp Make Money?” Hacking Revenue, Hacking Revenue, 30 May 2016, hackingrevenue.com/revenue/how-does-yelp-make-money/.
“Yelp Business Model | How Does Yelp Make Money?” Business Strategy Hub, 14 Mar. 2019, bstrategyhub.com/yelp-business-model-how-does-yelp-make-money/.
https://www.innovationtactics.com/tripadvisor-business-model-canvas/#revenue-models
