Posts Tagged ‘Saus

02
Jun
12

Yelp Town Hall and How One Star Increase = 5% to 9% Increase in Revenue

I attended Yelp Boston Town Hall, billed as a forum for the fourth in a series of cities hosted by Yelp offering businesses best practices in how to engage online critics and exchange ideas with other local businesses trying to harness the best in Yelp.  Yelp Boston Community Manager, Damien Smith quarterbacked a panel conversation with two avid local Yelpers, Darnell Holloway, Yelp’s Manager of Local Business Outreach, and two local businesses who are faring quite well with Yelp – Renee Eliah of Saus, a Belgian waffle and pommes frites place near Government Center and Brian Poe, chef of Poe’s Kitchen at the Rattlesnake and Beacon Hill newcomer Tip Tap Room.  And though the event was held in a restaurant with two restaurants as the businesses on the panel the folks from Yelp noted that restaurants account for only 23% of the reviews on Yelp.  Note to anyone holding a social media event in a downstairs section of a venue – make sure there’s working wifi to use an event hashtag such as #yelptownhall on social media or to check in on Yelp.  Does that belong in a Yelp review of hosting an event at the Back Bay Social Club?…

Renee shared anecdotes that Yelp worked as a marketing tool for Saus to channel pre-opening anticipation of pommes frites-philes and curiosity to build buzz when the doors finally opened.  Renee also believes that the majority of their business in the beginning was attributable to Yelp and that helped keep the business going.  Yelpers actually came to Saus’ defense from online harsh reviews of growing pains common to lots of new restaurants.

Brian talked about a real-time turnaround when a guest shared the status of a bad experience on social media while it was happening and from afar he and his team were able to figure out who the patron was and made things right for that patron before he left the restaurant.

The Yelping Yentas had earnest intentions in offering frank reviews to business but it’s hard not to feel for the business owner who spoke from the crowd equating bad reviews as graffiti on one’s home or the tattoo studio entrepreneur contending that competitors might be the source of staged reviews or inflating their own reviews manufactured by friends and family.

The event did not offer a magic elixir to remove the digital stains of bad reviews on Yelp, but it did offer some key takeaways:

  • Bad reviews are nothing new.  Attention and resolution of reasonable customer complaints can turn things around.
  • Consistently good customer service and attention will pay off in the long-term.
  • Yelp reviews can be considered focus groups for feedback on your products and services.
  • Higher ratings and great reviews grow organically.  Pushing non-Yelping customers to write a review leads to less-than-raving reviews and fewer stars because people feel obliged and may not even be familiar in how to write a great review in Yelp-ese.

    Reviews, Reputation, and Revenue: The Case of Yelp.com
    Michael Luca, HBS
    Working Paper

The most delicious part of the night was a serendipitous conversation with Chantelle Karl, Yelp Senior Public Relations Manager when I asked about how much, in dollars, a good Yelp rating is worth when Michael Luca just happened to join us.

Michael is an Assistant Professor at Harvard Business School and author of  “Reviews, Reputation, and Revenue: The Case of Yelp.com”.  Mike studied the impact of Yelp reviews on Seattle area restaurants through Washington State Department of Revenue data.  His Working Paper demonstrates that a one star Yelp rating increase can lead to a 5 to 9 percent increase in revenue.  Pretty cool to meet someone who can put it into dollars and sense.

Yelp did a good job taking their own advice listening to business owners’ side of their model for feedback.  And for those business owners who obsess over tough criticism, there are many bigger priorities in running a business and plenty of customer marketing options if Yelp is not one’s choice.




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