Is Advertising on Yelp Worth it For a Small Business?

Over the last six months several of my clients have been approached by Yelp representatives. As one of my clients told me, “they are very aggressive.” At this point, the only way Yelp can make money is through advertising. Their advertising technique is to place business ads in their Yelp results. These ads show up above the actual results when Yelp users are looking for a business. Yelp also allows advertisers to place ads on their competitors Yelp listings. You can create your own opinion as to how you feel about this particular technique.

To determine if Yelp ads are worth it for your small business it is important to come up with an advertising budget. There is no point even taking a phone call from Yelp, Facebook or Google if you do not have a monthly advertising or marketing budget. If you are a very small business that does not spend much on advertising there is a good chance you are going to find Internet advertising to be quite expensive.

Google Adwords can charge as much as $75 to $100 per click for highly competitive┬áterms. Yes, one click! Yelp has two options for advertisers – cost per impression or cost per click. Cost per impression is paying every single time your ad shows up when people are looking for a business. They may or may not click the ad. They may or may not even see the ad. Cost per click is exactly what it says. As an advertiser you will pay each time someone clicks the link to go to your Yelp profile.

If you have a monthly advertising budget and you find that Yelp is much cheaper or more affordable than Facebook or Google it might be worth it to look into purchasing Yelp ads. Remember that many Yelp search queries show up on the front page of Google search. This means that Google searchers will likely click the result and your advertisement will be on the top of their page. If Google is charging $65 for this click and Yelp is only charging $12 it might be well worth it to advertise with Yelp rather than with Google.

yelp-advertising-vs-google

Notice the front page search results for “Raleigh Steakhouse”. The Yelp result is #2 and will likely be clicked on quite a bit. In fact, if I were searching for a Raleigh Steakhouse I would click the Yelp search results first simply because I know Yelp is respected in terms of dining options. I wouldn’t click any of the organic search results until I looked at the Yelp results first.

UPDATE: Yelp has seen a drastic drop in Google search rankings with a few of the latest Google Algorithm updates. If Yelp does not rank well in search their business model is going to struggle; hence the reason for the stock price being down over 50% in the last year.

I would strongly encourage you to know and understand what keywords are your “money” keywords. If Yelp does not rank on the front page of Google search for these specific keywords then I would say you could spend your advertising dollars somewhere better. If you do find that Yelp ranks on the front page of Google for your “money” keywords then it might be more affordable to advertise with Yelp and, in essence, have ads on the front page of Google.