B2B social network Alignable ranked Yelp at or near the bottom of its Trust Index as measured by NPS ratings. There’s also anecdotal evidence that many business owners hold negative views of Yelp or harbor conspiracy theories about review manipulation for ad-sales purposes.
There are also critics in the industry who argue Yelp ads deliver a poor ROI. But yesterday Yelp reported Q1 earnings that were better than expected. The company said it had 121,000 local advertiser accounts, representing 34 percent annual growth. It also cited a 76% percent year over year advertiser repeat/retention rate.
It presented the chart above in its earnings slides, showing an average advertiser ROI of 269%. That’s based on average monthly spend of $267 and $983 in revenue from Yelp leads. How the company determined revenue per advertiser wasn’t disclosed.
Yelp also said that it had roughly 2.8 million claimed Yelp profiles/accounts. This means that Yelp’s existing advertiser base is about 4% the number of claimed accounts. That represents a significant growth opportunity, putting aside the larger SMB marketplace.
There’s an interesting disconnect between Yelp’s retention and ROI data and its critics’ claims, as well as the NPS scores reported by Alignable. I’m interested to hear what you think about:
- The ROI figures cited
- The 76% “repeat rate”
- How Yelp can be having this sort of success with SMBs, given all the skepticism (and poor perceptions) that are out there