Yelp has bought European competitor Qype for $50 million. Qype was founded in roughly 2006 in Germany but the UK is probably its strongest market. In the past the site has sometimes been described by North Americans as the “European Yelp.”
As Yelp entered Europe and developed greater brand strength Qype began to stall. Yelp CEO Jeremy Stoppelman said in a blog post, announcing the acquisition, that Qype has “more than two million reviews of local businesses” and 15 million monthly uniques. But that number is down from 2010, when the site reported 17 million uniques.
Yelp wants to accelerate in Europe; Qype’s growth story is probably over. Therein lies the logic behind the acquisition. (Yelp will be speaking at the upcoming Local Social Summit in London; a small number of tickets are left.)
Foursquare has over the past year moved away from being a “social networking” site to becoming a local search utility. Over time, if it doesn’t get acquired, Foursquare may have the brand strength and reach to be an effective challenger to Yelp. Right now, however, it has become a global-local game of Google vs. Yelp among consumers (putting aside important verticals such as TripAdvisor or OpenTable).
Online yellow pages traffic is basically flat with some exceptions in individual markets. Bing sees lots of traffic as a search engine but the company now has a content deal with Yelp. Apple’s maps and local search deal with Yelp has also given the company a big boost and more visibility.
As we just learned this week Yahoo says it’s not going to invest in local (though it wants to compete in mobile search). And although what actually happens with Yahoo and local remains to be seen, absent some new deal or source of vitality the site will continue to fade as an important local search destination and traffic source for marketers.
Facebook has yet to really make any kind of credible move in local for consumers or advertisers. Twitter will do more with SMBs (and by extension local) over time but right now not much is going on there.
Of course Google unsuccessfully tried to buy Yelp before the latter went public, resulting in Google’s later acquisition of Zagat. Yelp has had its share of troubles with SMB advertisers (see: class action lawsuits) but overall the site continues to grow and be a major local search staple for consumers — resulting in gaming efforts by frustrated SMBs.
In the confusing and complex “local search ecosystem,” local marketers and business owners want to focus on fewer rather than more sites and channels. Unless the direction of the market changes, for more and more of them it will be: Google, Yelp and Facebook. Where local is concerned everybody else becomes part of “other.”
Do you disagree? If so, why?