Yelp has launched in Australia and could shake up our restaurant reviewing scene. Image: allthingsd.com
US review website, Yelp, has hit Australian shores, and if people's response to it is anything like what has been seen in its hometown, the restaurant industry could be in for a surprise.Yelp, which operates in a similar fashion to our own
Eatability but for a number of industries including accommodation, foodservice beauty and books, was launched in Australia yesterday after cementing a partnership with Sensis' Yellow Pages.
What makes Yelp different to a number of the review sites already existing in Australia, is how it filters through reviews and comments and only publishes top quality consumer feedback.
According to
SMH, Yelp uses something similar to Google's search algorithm to comb through comments, scoring their validity, accepting good quality responses and disregarding the rest. The website also uses interfaces with Facebook Connect to ensure businesses can't get their friends to post favourable reviews.
A study by
Harvard Business School assistant professor Michael Luca titled 'Reviews, Reputation and Revenue: The Case of Yelp.com' used data from Yelp and Seattle restaurants between 2003 and 2009 and found that the review website can have a significant affect on the foodservice industry, particularly the restaurant industry.
Three key points emerged from Luca's study:- A one star increase in Yelp rating leads to a five to nine percent increase in revenue
- This effect is driven by independent restaurants; ratings do not affect restaurants with chain affiliation, and
- Chain restaurants have declined in market share as Yelp penetration has increased.
So it seems that people are taking Yelp's reviews seriously, even following their advice. This could have something to do with the fact that Yelp doesn't allow its users to post anonomyously while at the same time promoting posts as an opportunity to share descriptive and useful information about a business, not as a forum for venting anger.
Having only launched yesterday, we will have to wait to see if Yelp takes off in Australia like it has in the US, and if our own restaurants will reap the benefits (or the losses) of the website's more respectable reviews.
What do you think about sites like Yelp? Do you think it will be seen as a more trustworthy, respectable review site in Australia, or should we simply be leaving the reviews to the Matt Prestons and Terry Duracks of the world?Yelp can also be downloaded as an app for smartphones. Watch this video to learn about other Yelp features.
