Yelp is an American multinational corporation founded in 2004 and headquartered in San Francisco. It develops, hosts and markets Yelp.com and the Yelp mobile app, which publish crowd-sourced reviews about local businesses. Yelp’s business has expanded in recent years from its West Coast stronghold to the East Coast. With this expansion, local event professionals and disc jockey companies have been receiving phone calls from Yelp advertising reps seeking to enroll them in paid advertising programs on Yelp.
Free Yelp Advertising
Did you know that you can claim a free business listing on Yelp? I did so about four years ago at the recommendation of a DJ colleague located on the West Coast who was using Yelp to great effect in the Seattle area.
During our business’ free Yelp listing period, we on average had 30 to 40 leads per month based on Yelp users who clicked on our ad. We received about 18 reviews and booked 1 to 3 events per year including weddings and corporate events. For the price paid (zero), it was a great return on investment! The most frustrating part of our Yelp experience was that many of the reviews for our business were classified by Yelp as “not recommended” and thus did not count towards our average star rating. These ‘not recommended’ reviews were all real clients who we did real work for. I suppose that if classifying reviews by new reviewers as ‘not recommended’ protects our business from false negative reviews from competitors, then it might be a worthwhile safeguard.
Trade Up to Paid Yelp Advertising?
I have spoken to several Yelp sales reps through the years offering paid advertising. I always choked on their pricing. However, early in 2016 I spoke with a particularly well-trained and persuasive female sales rep from Yelp. In her sales presentation, she shared powerful statistics about Yelp regarding the high income demographics of Yelp users and their tendency to purchase quickly after viewing a business listing on Yelp. Of great interest was a study provided by a third party researcher showing that Yelp advertisers were on average earning a 200% return on investment (ROI) (in other words if you spend $1 on an ad, you will receive back the $1 cost of the ad, plus receive an additional $2 in profit).
The said Yelp sales representative also came prepared with a DJ case study. This California DJ advertiser is booking 8 weddings per week on Yelp! Sure, if a New Jersey DJ could book 400 weddings a year from a paid ad with Yelp, who wouldn’t sign up? I expressed my concern with the Yelp rep that her case study could be a statistical outlier on the bell shaped curve, but she assured me that this was not the case. Another controversial claim that she made was that Yelp reviews are more objective than reviews found on WeddingWire or The Knot – a point that I did not agree on.
In my mind, I was thinking, do New Jersey brides look for wedding services on Yelp? Isn’t Yelp for reviewing restaurants and hair salons? Regarding Yelp’s prevalence in the New Jersey wedding market, my friend and colleague Mike Wieder from Ultimate Sounds Entertainment in East Windsor, NJ was similarly propositioned by Yelp. Mike shared this story with me “I did an informal poll with brides past, present and future asking how they went about their entertainment search and after talking with over 50 of them not one mentioned Yelp as a resource. As a matter of fact, when I asked if they used Yelp, almost to a person they said they only use Yelp for things like restaurants.”
Against my gut (which said not to do the program), I decided to risk about $2,000 over the shortest minimum time commitment period that I was able to negotiate. My program price included the production of a free corporate video plus a budget towards pay per clicks on our featured Yelp ad. Our ad would appear at the top of the page for wedding DJ and DJ related searches in our local market area. Plus it would appear on competitors’ pages. One of the main reason that my gut was saying ‘no’ to paid advertising on Yelp is that it would become our most expensive advertising program on an annualized basis – even more expensive that our featured ad on The Knot. So, this was the type of mistake that could be quite costly if Yelp didn’t deliver.
Experience with the Program
In preparation for the upgrade, I spruced up our page with lots of professional images showcasing our wedding services. After trading up to the paid advertising program, we were projected to have approximately 148 leads a month on their pay per click system, up from 30-40 leads per month under the free program. Yes, the amount of inquiries and bookings did noticeably increase after making the upgrade.
Yelp has an information-packed portal for business advertisers to track their campaign’s results. For example, on a daily basis I can see who called our business through Yelp (they assign you a unique phone #), who messaged our business for more information, who clicked on our map, etc. Thus, it’s very transparent on how well (or not) the program is working.
Yelp also sent out a videographer to produce a professional one minute corporate video to be placed on our Yelp business profile page. The videographer assigned to our company was a pleasure to work with, and went above and beyond to create a high quality video for us. While it is possible to gain unrestricted rights to the video, these rights come at an additional fee. For the time being, the corporate video can only be viewed on our Yelp page.
During our campaign with Yelp, we booked the following events from our Yelp ad:
A wedding in our hometown (interestingly, a relative of the bride found us on Yelp)
A wedding Emcee job in a nearby adjacent town
A sorority reunion party
A kid’s birthday party for the daughter of a famous hedge fund manager in NYC
A kid’s birthday party in a nearby town that included a Photo Booth service
Financial Return and Decision
In computing our company’s return on investment, keep in mind that I am a multi-op, so that when I send out one of my DJ’s to an event, I only receive a percentage of the total revenue on a job. If I perform the job personally, then I keep the entire fee.
Based on my calculations, I spent $2,000 on Yelp and got back $2,700 and a free corporate video. While a positive return (35%), the Yelp program didn’t meet my hurdle rate of return. And I was disappointed to learn – that as suspected, New Jersey brides are not heavily using Yelp to book wedding DJs.
Accordingly, I informed Yelp that I would not be renewing my ad. They tried their best to keep me onboard, but their logic failed to resonate and they wouldn’t budge on pricing. It really came down to a financial decision. If the price were a bit lower or the bookings rate a bit higher, the program could have been a winner for us.
A Tale of Two Coasts
As previously mentioned, Yelp was founded in San Francisco and is an entrenched advertising institution on the West Coast. Adam Tiegs of Adam’s DJ Service based in the Seattle Washington area was the professional colleague who originally turned me on to Yelp years ago. Before publishing this article, and to be fair and balanced, I asked Adam about Yelp on the West Coast.
As per Adam, “Yelp is actually one of my biggest secrets. It works so well for me here, not only are brides and grooms finding me, but corporate clients find me on Yelp.” Further expanding upon his Yelp success Adam said, “I do cost per click campaigns with them seasonally, but I actually get my best return from Yelp than any other place I advertise. Personally I find some of my best clients on Yelp because usually both the bride and groom are educated and both have good incomes and care about service quite a bit.”
While the Yelp program was not a debacle for this New Jersey disc jockey, it did not live up to the average Yelp advertiser experience of a 200% Return on Investment, nor produce a feeding frenzy of wedding bookings. However, be sure to research Yelp’s place in your local market – there are definitely regional differences. Like Mike Wieder did, take a poll of your brides past, present and future to see if they use Yelp to research wedding professionals.
DJs would be wise to investigate creating a free listing on Yelp with the idea that you may be able to pick up a few high quality bookings per year at no financial cost. Having a Yelp page also provides DJs another place to collect reviews and attract future clients.
Finally, salespeople and advertising reps in particular should not present statistical outliers as the average experience just to get the sale. It leaves a sour taste in the mouth of the customer.
To view our company’s list on Yelp, visit www.yelp.com/biz/ambient-dj-service-hightstown
To learn more about Yelp’s business advertising programs, visit www.yelp.com/advertise