- Yelp announced a record-setting Valentine’s Day week that included 5.6 million diners placing reservations on its waitlist platform, according to a company press release.
- The platform also managed 22 million diners in December. Driving much of this growth is Yelp’s mobile app, which has tripled its growth in the fourth quarter compared to the previous year's quarter.
- Last year, the company also added restaurants to Yelp Reservations and Yelp Waitlist, introduced Yelp Kiosks and integrated Grubhub's restaurant network onto its platform (this partnership alone increased food orders and takeout orders on yelp by 27% in Q4 2018 compared to the previous year).
Yelp may have relinquished its restaurant reviews throne to Google in 2015, but the company nimbly pivoted to reservations, which has proven to be a good move. With the company managing 22 million diners in December alone, it is chipping at market share leader OpenTable. Still, by comparison, OpenTable seats 124 million diners a month month at more than 48,000 restaurants globally, according to the Chicago Tribune.
"Product innovation in 2018 has paved the way for us to build even stronger relationships with current restaurant partners and to attract thousands of new ones," Devon Wright, general manager of Yelp Restaurants Marketplaces, said in the release. "This momentum is the early result of Yelp's long-term strategy to acquire and integrate leading restaurant technologies into Yelp and offer a seamless dining experience for both restaurants and consumers."
In a fast-changing, technology-dominated environment, Yelp smartly diversified its offerings through acquisitions, including SeatMe in 2013 and Nowait in 2017. The latter partnership facilitated the rollout of kiosks last year to trim restaurant wait times, which Yelp claims has helped increase foot traffic — a big deal in a saturated environment in which every concept is intensely fighting for new customers.
Tony’s Pizza Napoletana, which has been named "The Best Pizzeria in America," claims it has increased its sales by up to 30% with the help of Yelp's more accurate wait time estimates. First Watch touts similar benefits in the press release. Shorter, more manageable wait times are going to appeal to customers and provide a strong reason for operators to leverage Yelp's growing services.
More customers are also likely to leverage Yelp's Grubhub partnership, as it offers a bigger selection of restaurants from which they can order.
Despite Yelp's diversification, online reviews remain a critical space for restaurants. More than 80% of diners eat at restaurants that respond to online reviews, according to a recent survey. Despite increased competition from sites such as Resy and Allset, Yelp should remain competitive in the space, charging less overall than OpenTable and, after last year, offering more.
Still, it hasn't been all smooth sailing at the company. One of Yelp's top shareholders called for new board members and a management overhaul in December, citing a slow pace of innovation and a lack of strategic direction. The shareholder argued that competitors such as Google, Facebook and Uber have amassed $26 billion in market capitalization, versus Yelp's $2.9 billion. Yelp has fallen short of earnings expectations for the past 12 of the last 19 quarters. Its stock prices were flirting with $100 in 2014 and are about $38 today. But its Q4 results show its strategic diversification may be paying off — net revenue was up 11% year over year.