Is It A Good Idea To Pay Yelp For An Enhanced Listing?


Objective Tests

We’ve run quite a lot of paid advertising campaigns for clients on Yelp, Houzz, and others over the last 2-3 years. We did them mostly as tests to see if we could identify significant ROI-orientated results from the investment.

The bottom line is that if we saw our clients get more back in business profit than they spent, we would recommend doing them.

The results, however, did not produce any significant upswing in business on any of the test campaigns we ran. Therefore, in most cases, doing paid advertising campaigns for ROI purposes on platforms like Yelp is generally not something we recommend.

That is not to say that it never pays to advertise on any of these platforms. The trick is to test their efficacy very carefully. Most people, unfortunately, do not take the time to measure a campaign’s results, so they just keep spending, hoping it is doing something for them.

 

The Bigger Picture

Nowadays a pretty standard business model on the web is to offer a free service, such as the ability to list your business on a platform like Yelp, Houzz, Angie’s List, and many others. Then as the platform builds a bigger and bigger list and their listing platform gains general visibility, they monetize the platform by trying to upsell the people using their free service into paying for some kind of enhanced listing.

When you think about it, this model applies to not just the companies mentioned above but to Google itself. Google index and list your site in Google Search for free, but what they really want is for you to pay for an enhanced listing, namely AdWords. Google is simply the most successful with the model.

 

How To Win The Game

There is no question that utilizing these free services, i.e., listing and optimizing a business’s visibility on all of these platforms produces big benefits for any business. The trick is to use and leverage their free service as much as possible without getting sucked into paying for their upsell service. When played that way, the listing business wins the maximum. If the listing business, however, pays for an enhanced listing, the listing business incurs a cost, and the listing platform makes money from them. Google makes billions of dollars every year from JUST this model. 90% of Google’s revenue comes from AdWords.

In my mind, it’s a bit like the way credit cards work. Banks give people credit cards for free. It’s a free service. All the time the credit card owner has the discipline to pay off their credit card in full every month, they win the maximum benefit with zero cost. However, as soon as they leave a balance, the bank charges interest, the user incurs a cost, and the bank makes money from them.

 

When It Makes Sense Fund The Up-sell

  • Periodic and very specific tests.
    • Sometimes for very specific keyphrases, where there is no current organic visibility, AdWords can be a useful test to see if people who search on a particular phrase will actually buy. If they do, then it is a no-brainer to invest in organic visibility. Organic visibility will typically return a 5 to 6 times result over AdWords.  However, it is a LOT more work and takes time. AdWords can be a great tool in this way as the results are instant.
  • Brand awareness
    • There’s no question that participating in enhanced listings will help with general brand awareness. When your company name or brand shows upfront and center everywhere, people will better recognize your brand.

 

Turning the Tables – Really Winning – Winning Big

To really win, the trick is to leverage the platform to its fullest extent and to do it better than your competition. Doing this is usually a combination of adding content and getting reviews.

  • Content
    • This means generating and posting a continuous flow of good, highly optimized content.
  • Reviews
    • Most platforms, Google, Yelp, Houzz, and others allow your customers to post reviews about you and or your products. Look at it this way, a continuous flow of good reviews on Yelp will outperform tens of thousands of dollars in paid advertising with Yelp.

Continuously adding great content and causing your customers to leave reviews is, however, a lot of work. In the long run, though, it is our experience that doing these two things will reap benefits orders of magnitude higher than participating in paid advertising campaigns on those platforms.

 

Related

When to Advertise on Yelp and Make a Killing