Tag: Yelp


Google’s Acquisition of Zagat Should Scare Yelp

From the perspective of a tech blogger I can safely tell you that there have been countless times where companies have made decisions that I have had no choice but to question.  Sometimes my crucial outlook on business moves has been proven wrong, and I’m not shameful in the least to admit that I, like every other human being, am frequently incorrect.  But there are some moves that I question that have the exact opposite effect.  These moves don’t prove themselves to be well thought-out or well orchestrated.  Not by a long shot.  Rather, there are simply some business decisions that I’ve seen in the tech industry that continuously prove to be worse and worse for a given company.

Perhaps a great example of this concept is this week’s decision by online restaurant and rating site Yelp.com to trim up its deals team in the midst of constantly growing competition from sites like LivingSocial, Groupon, and Google’s “Google Deals” service that the company has been working to improve.  I mean, I can understand cutting back on a service that had little potential, but when it boils down to it I truly do believe that a daily deals service from Yelp is going to be something that the company is going to wish they had vested more effort into down the road.  After all, the sheer fact that there are so many other entities trying to absorb as much of the deals market as they can right now should speak pretty well for the fact that Yelp has shifted focus away from a very promising market.  And with Yelp’s standing, reputation, and loyal user-base, there isn’t a part of me that doesn’t believe that Yelp could have easily dominated the deals market had they chosen to allocate more staff into the project to give it the attention that it honestly deserves.

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A Pivot Perhaps? Yelp Trims Daily Deals Team.

When Google wants to copy or mimic your idea you take it as a sign that your company and venture is taking a step in the right direction.  When Google puts an offer on the table and wants to buy your company and idea, though, you know that you’ve hit a home run.  So imagine how it felt for the folks behind Groupon to turn down Google’s acquisition offer – estimated to be at around six billion U.S. dollars – late last year.  Pretty liberating, right?  And better yet, such a substantial offering for what in reality is a very young startup company means that Google saw a huge potential in what Groupon was building.  And with Google’s history, I think it’s safe to say that the company is more than qualified at sensing killer business ventures.

Maybe it’s just me and perhaps it’s just the fact that deal-based services had caught my eye after the Google/Groupon deal caught media attention, but it really seems to me as if services offering “daily deals” have become more and more popular in the last nine months of so.  I mean, look at how far deal site Living Social has gotten in the past couple of years, utilizing the poor state of the economy and the tighter budgets of just about everyone to push their service; even to the point of placing an ad during the February 2011 Super Bowl.

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Foursquare, Gowalla, Yelp, Booyah Should Be Cautious of Facebook

Last week, Facebook announced Facebook Places, I’m going to spare you the details of what Places actually is because I’m sure you have read about it elsewhere.  Instead I’m going to discuss how bad of an idea it was for these companies to have partnered with Facebook for their Places product.  Who exactly partnered with Facebook for Places?  Foursquare, Gowalla, Yelp, and Booyah (so far, I’m sure there will be more).  This is a bad idea.

Since when has Facebook ever played nicely with their partners?  Since when have any Facebook acquisitions lived past acquisition and if they have (I can only think of one – Friendfeed) when have they succeeded?  The answer is they haven’t.  Look at their most recent acquisition of Hot Potato – they shut that down, too.  Same with Divvy Shot, Parakey, and Nextstop.  I’m sure there are others that I missed, but you get the idea.  Facebook acquires these companies not for the product, but for the talent.  They are called talent buys and there is absolutely a method to the Facebook acquisition madness.  Facebook wants to completely dominate everything in the social/mobile market.

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