San Francisco-based reviews platform Yelp has never been a favorite for restaurant owners, as they say its calls from ad salespeople disrupt their daily business, and that inaccurate or uncharitable reviews written by presumed patrons threaten their ongoing success. With the food business now under unprecedented pressure as the coronavirus crisis prompts the closure of restaurant dining rooms and a pivot to takeout and delivery, some restaurants are hoping diners drop the platform completely.
According to Yelp, U.S. consumer interest for Yelp’s restaurant listings has fallen by 54 percent in the past week. When it comes to bars, traffic is even lower: According to a blog post from Yelp CEO Jeremy Stoppelman, U.S. interest in nightlife spots has dropped across the platform by 69 percent.
Neither figure bodes anything nice for the platform, as it’s reliant on its users to generate content for it to survive. If businesses are closed, there are no customers to write Yelp reviews. No reviews means no reason to visit Yelp, and no visitors means no one will see its ads — Yelp’s primary revenue stream as of late last year, a model that’s been in place since the company’s creation.
To combat that, Yelp says, it’s offering “$25 million in relief,” for small and independent bars and restaurants, but that $25 million is “in the form of waived advertising fees, and free advertising, products, and services,” not cash, it admits. As part of the package, restaurants and bars will get “free access to Yelp page upgrades, including Business Highlights and Call To Action,” the company says, offering all through April 30, 2020.
Leave nice Yelp reviews to counteract the Karens who are negging restaurants for “short staff”— Michael (@wongisrite) March 23, 2020
The actual efficacy of Yelp ads is open for discussion, and as long ago as November of 2018, restaurateurs have said that they have been shifting their paid local advertising to platforms that seemed to promise clearer return on investment. Now, in a message to shareholders, Stoppelman says that the revenue the company had projected for the first quarter of 2019 is unlikely to come through. According to the SF Business Times, Yelp had expected its first quarter revenue to increase by 8-10 percent, with a 10-12 percent jump expected for all of 2020.
While last year, Yelp’s revenue hit $1 billion, this year Stoppelman just doesn’t know. “With the rapid spread of COVID-19 across the United States, we have witnessed a growing number of state and local governments restrict public life,” Stoppelman told shareholders. “Even as Yelp remains well positioned with a broad customer base and strong balance sheet, we believe it is appropriate to withdraw our first quarter and full-year 2020 guidance. While we cannot determine the full extent of COVID-19’s impact on our business at this time, we are monitoring this rapidly evolving situation closely.”
If we get a Yelp review about our take-away service I’m gonna lose it.— Pim Techamuanvivit (@chezpim) March 22, 2020
The other day someone was furious that we couldn’t just find some squid to add to his pork jowl order because that’s how he likes them. We were like, oy, did you know that’s a bloody apocalypse on! ♀️
While restrictions on public life will surely snarl some of Yelp’s profitability, it seems like a dead stop on reviews might thwart it completely. That’s what some restaurant owners, like San Francisco’s Pim Techamuanvivit, are suggesting. Techamuanvivit owns Michelin-starred Union Square restaurant Kin Khao, and vaunted Japantown spot Nari, both of which have made recent headlines for their menus’ deliberate absence from online food delivery platforms. In the current crisis, Techamuanvivit has pivoted to a limited takeout model, but worries that demanding diners might lampoon her restaurants on Yelp. “If we get a Yelp review about our take-away service I’m gonna lose it,” she tweeted Sunday. “The other day someone was furious that we couldn’t just find some squid to add to his pork jowl order because that’s how he likes them. We were like, oy, did you know that’s a bloody apocalypse on!”
Other restaurants, like New York’s acclaimed Prince Street Pizza, are taking a harder line against the San Francisco company. Via Instagram, it asked, “Why are you still writing Yelp reviews at a time like this” as places are “risking their lives to serve the communities food...I am so sorry you didn’t the magical experience you hoped for Karen.”
“Just know if you’re Yelping during a time like this,” the square pie purveyors said, “there is a special place in hell for you.” As of publication time, the most recent review on Prince Street’s Yelp page gave it only one star. In the review, which was posted on March 23, the disappointed diner concluded with the note that “before anyone else feels the need to bash me with my experience this absolutely has nothing to do with the pandemic. It was an experience that I had and am just now getting to review.”