Yelp Inc. (‘Yelp’) operates as a local resource for consumers and a partner in success for businesses of all sizes.
The company’s platform provides the type of reliable and useful review content that helps consumers make informed spending decisions and confidently transact with local businesses. The company has also developed industry-leading content moderation practices to maintain the quality and integrity of its content. For example, the company’s recommendation software and other tools, inc...
Yelp Inc. (‘Yelp’) operates as a local resource for consumers and a partner in success for businesses of all sizes.
The company’s platform provides the type of reliable and useful review content that helps consumers make informed spending decisions and confidently transact with local businesses. The company has also developed industry-leading content moderation practices to maintain the quality and integrity of its content. For example, the company’s recommendation software and other tools, including machine learning algorithms, are designed to surface the most useful and trustworthy information on its platform for consumers. This technology, together with content moderation by the company’s User Operations team and other consumer protection efforts, helps the company detect and mitigate attempts to manipulate ratings and reviews. As of December 31, 2024, approximately 76% of the reviews submitted to the company’s platform were recommended.
Consumers trust the company for the more than 280 million ratings and reviews available on its platform of businesses across a broad range of categories. This consumer trust is the foundation of the company's business, from which it is able to empower other businesses to succeed. The company’s advertising products help businesses of all sizes reach a large audience, advertise their products, and drive conversion of their services. Yelp has operations in the United States, the United Kingdom, Canada, Ireland, and Germany.
The company’s trusted content has attracted a large, high-intent consumer audience. This large audience reflects the strength of its brand as a leading resource for consumers to search for and discover great local businesses across categories, as well as the company’s availability across a wide range of platforms and devices. It also provides a compelling value proposition to advertisers.
The company’s large consumer audience supports a broad-based advertising model with products designed to meet the needs of businesses of all sizes. Its portfolio of products and attribution capabilities leverage first-party data to provide advertising solutions across categories and each stage of the consumer funnel, both on and off platform. These products are backed by a scaled and extensible advertising technology platform. To establish the price of an individual ad click, the company runs an auction for each advertising placement, which resulted in an average of nearly 18 million auctions per day in 2024. The bidding algorithms used in the company’s auction system are designed to prioritize spending advertiser budgets efficiently and maximize ad clicks to optimize the value it delivers to advertisers, while its proprietary ad delivery technology is designed to determine the most relevant ads for consumers to drive fulfillment.
Growth and Margin Strategy
In 2025, the company plans to invest in the areas set forth below, each of which represents its own long-term opportunity and which together will drive long-term sustainable and profitable growth.
Revenue Growth
Lead in Services. The company intends to create a best-in-class Services experience for consumers and service professionals in 2025. With the company’s robust network of service professionals, large dataset of trusted content and sophisticated matching algorithm incorporating a wide array of proprietary inputs, Yelp has a strategic advantage in providing an exceptional Services experience. The company plans to leverage AI to further reduce friction across the hiring experience, while improving the quality of leads and conversations for services professionals through matching and other improvements. The company’s Auto Services category — which is the company’s second largest category by revenue following the company’s acquisition of RepairPal, Inc. (‘RepairPal’) in November 2024 — also presents a significant growth opportunity. The company plans to improve Request-a-Quote for Auto Services on Yelp, as well as attract more consumers to RepairPal through the company’s search engine optimization and search engine marketing expertise. In addition, the company plans to build on its product and sales efforts for multi-location Services businesses in 2024 to capture more demand from these advertisers, including by directing more projects to these businesses that have the capacity to ingest higher lead volumes.
Drive Advertiser Value. In 2025, the company is working to further optimize advertisers’ budgets through a portfolio of product initiatives designed to prioritize the most relevant ad content for consumers searching for local businesses, which will help the company continue to attract and retain new customers. The company plans to further develop its advertising technology and ad products to match consumers and advertisers even more efficiently both on and off Yelp, including by providing advertisers with additional AI-powered controls and recommendations to help further refine ad targeting. The company also plans to continue improving the efficiency of its performance marketing spend to acquire small and medium-sized business (‘SMB’) advertisers.
Transform the Consumer Experience. The company’s trusted content forms the basis for its business and has made Yelp a leading resource for consumers to confidently search for and discover great local businesses across categories. In 2025, the company intends to continue leveraging AI to transform the consumer experience. For example, the company plans to experiment with extending Yelp Assistant to additional categories beyond Home Services and making it accessible through additional entry points on the company’s platform. The company also expects to make the home feed even more personalized and dynamic by using AI to help consumers discover new and relevant businesses. To help consumers find and connect with the right businesses for their needs, the company also plans to create an even more seamless and actionable search experience.
Delivering Profitable Growth: This includes delivering more value to advertisers by improving the quality of Services leads.
Products and Services
Advertising
The company offers a range of free and paid advertising products to businesses of all sizes, including the products listed below, which provide the ability to deliver targeted advertising to the company’s large and high-intent audience. The company recognizes revenue from its business listing and advertising products, including advertising sold by partners, as advertising revenue.
Advertising Products
CPC Advertising (‘Yelp Ads’)
The company allows businesses to promote themselves in sponsored search results on its platform, on the Yelp pages of businesses in the same or related categories, and other key places on the company’s platform. Yelp Ads can also be delivered through syndication on the Yelp Ads Network, a large collection of third-party sites. The company primarily sells performance-based ads, which its advertising platform matches to individual consumers through its automated auction system priced on a CPC basis. The company generates a majority of its advertising revenue from the sale of CPC advertising. The company also provides Services businesses with the ability to provide competing quotes for consumers using its Request-a-Quote feature and with a way for consumers to easily request a phone call from them through its Request-a-Call feature.
Multi-location Ad Products
The company offers a range of ad products designed for multi-location advertisers, including: Showcase Ads, which showcase and feature limited-time offers, new products, or promotions in relevant search results; Spotlight Ads, which highlight special offers and promotions related to seasonal or other special events on Yelp business pages in a prominent carousel directly on the Yelp app home screen; and Yelp Audiences, which extends campaign reach to its high-intent audience off platform. The company also offers first-party attribution solutions: Yelp Store Visits, which provides insights on how Yelp Ads drive physical store foot traffic, and a conversion API, which allows advertisers the ability to share their marketing data with Yelp to more accurately measure the effectiveness of their advertising spend.
RepairPal Network
The RepairPal marketplace and partner network promotes auto repair shops to consumers searching for auto repair services. Auto repair shops pay a monthly fee to be included in this certified shop network, as well as either a percentage of earnings from repair orders made by referred customers or a fixed fee per referred customer.
Business Page Products
Free Business Account
Businesses have the ability to create a free business account and claim a Yelp page for each of their business locations. Once a business has claimed its page, it can more easily update its listing information and has the option to purchase certain page upgrade features.
Upgrade Package
The company’s most popular product after Yelp Ads is its Upgrade Package, which includes access to features such as the removal of competitor ads from the business’s Yelp page, Business Highlights, Portfolio, Yelp Connect, and Logo, each as described below, among other features.
Branded Profile
The company’s Branded Profile is a multi-location product that provides businesses with access to premium features in connection with their Yelp business pages, such as the ability to update listing information and select photos to highlight on the page through a slideshow feature.
Enhanced Profile
In addition to providing multi-location businesses with the same premium features and support options as the company’s Branded Profile product, its Enhanced Profile product prevents ads from other businesses from appearing on the Yelp business pages of its Enhanced Profile customers.
Verified License
Verified License is a badge that appears on Yelp business pages as a paid upgrade for certain eligible licensed businesses, primarily in its Home and Local Services categories. The badge indicates that the company has verified the business’s trade license and confirmed it was in good standing as of a certain date, allowing businesses to distinguish themselves as licensed and helping consumers make confident decisions when selecting businesses for their projects.
Business Highlights
Businesses in eligible categories can pay to highlight up to six attributes that make their business unique, such as ‘Family Owned’ or ‘Pet Friendly.’
Portfolio
Portfolio allows businesses to showcase their work or services to prospective customers through a collection of projects.
Yelp Connect
Yelp Connect provides advertisers with a channel to market new offerings, such as new menu items and specials, or communicate business updates to customers. Yelp Connect posts appear in various locations on its platform, including business pages and the home feed on its mobile apps.
Logo
Logo provides businesses with the ability to display their logos in high-visibility locations, including prominently at the top of Yelp business pages and in search results.
Nearby Jobs
Nearby Jobs provides businesses with the ability to see a dynamic feed of job quote requests in their area of business.
Yelp Guaranteed
Yelp Guaranteed is a satisfaction guarantee program that provides limited coverage to consumers who hire a Yelp Guaranteed business through Request-a-Quote in the event something goes wrong with their projects. It is available for eligible businesses in select Services categories that have Request-a-Quote enabled and are using Yelp Ads.
Other
The company generates other revenue through subscription services, licensing payments for access to Yelp data, transactions, and other non-advertising arrangements.
Yelp Guest Manager
Yelp Guest Manager is a subscription-based suite of front-of-house management tools for restaurants, nightlife, and certain other venues. These tools include online reservations, a waitlist management solution that allows consumers to check wait times and join waitlists remotely, as well as through hostless kiosks, and seating and server rotation management tools.
Yelp Fusion Insights (formerly Yelp Knowledge)
Through partnerships with companies, such as Sprinklr and Chatmeter, the company’s Yelp Fusion Insights program offers business owners local analytics and insights through access to its historical data and other proprietary content. The company’s Yelp Fusion Insights partners pay it license fees for access to Yelp Fusion Insights content.
Yelp Fusion
The company’s Yelp Fusion program enables developers to build products that include its high-quality content and data. The company partners with industry leaders like Apple, which makes its content available through Apple Maps and its virtual assistant Siri, as well as several auto manufacturers, including Audi AG and BMW, to make its content available in their in-dash experiences. The company offers free trial access to certain basic information through its publicly available APIs, as well as paid access to broader sets of content and data for consumer-facing enterprise use. The company typically enters into multi-year license agreements with paying Yelp Fusion customers, with rates determined based on the type and volume of usage.
Transactions
The company offers features and consumer-interactive tools to facilitate transactions between consumers and the local businesses they find on Yelp. These features are primarily available through partner integrations, the largest of which — by both transaction volume and revenue — is its partnership with Grubhub, which allows consumers to place food orders for pickup and delivery through Yelp. The company recognized revenue from these sources on a net basis as transactions revenue prior to 2024.
Other Partnerships
Other non-advertising partner arrangements include content licensing and allowing third-party data providers to update and manage business listing information on behalf of businesses.
Sales
The company sells its advertising products directly through its sales force, as well as online through its website and its Yelp for Business app, and indirectly through partners.
Sales Teams
Local Sales
The company’s Local sales team is responsible for selling its advertising products to any businesses with fewer than 10 locations. This includes smaller mid-market businesses and franchise businesses that follow a sales process closer to that of Local than that of multi-location businesses. Local sales representatives are primarily focused on adding new customers by generating qualified sales leads through direct engagement, direct marketing campaigns, and e-mails to local businesses.
Revenue from direct Local sales has historically consisted of the largest share of advertising revenue and was driven by growth in Local sales headcount. While it still represents nearly half of its advertising revenue, the company has become less reliant on Local sales headcount to drive growth as a result of its investments in its more margin-accretive Self-serve and Multi-location channels in recent years. This has allowed the company to optimize the size and compensation structure of the Local sales team accordingly.
Multi-location Sales
The company’s Multi-location sales team sells to any businesses with 10 or more locations, which consist of larger mid-market businesses, national businesses, and non-location-based brand advertisers. The company plans to continue expanding its suite of full-funnel ad products tailored to these advertisers and attribution solutions to drive revenue growth in its Multi-location sales channel in 2025.
Customer Success
The company’s customer success teams support existing advertisers through account management and retention initiatives, as well as engage advertisers with the goal of increasing their overall spend. For example, the company’s Local customer success team helps educate local business owners about how using Yelp can benefit their businesses, including by helping them create, update, and familiarize themselves with their Yelp business pages. The company’s customer success teams are also responsible for managing campaign performance by suggesting ad content and helping optimize to improve campaign performance.
Self-serve Sales
The company’s Self-serve platform allows businesses to purchase and manage their advertising products directly from its website or the Yelp for Business app. Businesses can purchase Yelp Ads and business page upgrades directly through its Self-serve platform. The convenience of the company’s Self-serve platform has helped it reduce its reliance on sales and customer support headcount. In 2024, the company’s performance marketing and continued improvements to the business owner experience drove another year of record Self-serve customer acquisition.
Sales Partnerships
The company also generates revenue through the resale of its advertising products by certain agencies and partners, such as Thryv, as well as monetization of remnant advertising inventory through third-party ad networks. The company’s Yelp Advertising Partner Program allows partner agencies to independently sell and manage ad campaigns on behalf of their SMB clients, providing increased centralization and flexibility. The products covered by these arrangements include Yelp Ads, as well as all of its business profile products.
Technology
The company relies on a set of core technologies that enable it to be a trusted local resource for consumers and a partner in success to businesses of all sizes. The company provides scalable services across platforms and devices using a combination of proprietary, open source, and third-party technology solutions and products:
Anticipating Consumer Needs: The company analyzes the large volumes of data collected from its platform and applies its proprietary indexing and ranking techniques to provide its users with contextual, relevant, and up-to-date information. The company’s sophisticated search platform delivers search results faster and at a lower cost than the industry-standard solution for some use cases, allowing better search matching and ad targeting. The company also applies machine learning algorithms to predict user needs and preferences based on factors, such as the user’s recent activity, location, time of day, and season, then tailors the user’s experience on Yelp accordingly. In the company’s Services categories, for example, if a user recently searched for movers, the company might suggest searches for businesses offering self-storage or junk removal. Similarly, if the company’s data suggests that a user is a homeowner, the company might promote collections of businesses that offer spring cleaning or other seasonally appropriate services.
Recommendation Software: The company’s recommendation software refers to the proprietary automated trust and safety software systems that it has developed to analyze the relevance, reliability, and utility of each review submitted to its platform. ‘Recommended’ reviews — those that the software deems to be the most useful and reliable — appear directly on Yelp business pages, while less trustworthy and unreliable content appears on secondary pages and does not factor into a business’s overall star rating. The company’s recommendation software analyzes all reviews, reviewers, and businesses, using hundreds of signals and billions of data points, and applies the same objective standards to each review, regardless of whether the business being reviewed advertises on Yelp. These signals include those related to the reviewer’s type and level of activity with Yelp (which might correspond to the reviewer’s reliability or suggest reviewer biases) and whether certain reviews originate from related Internet Protocol (‘IP’) addresses (which might mean the reviews were submitted by the same person). The software regularly evaluates each review, and as a result, its analysis can change over time as new data becomes available; reviews that were previously recommended may become not recommended, and reviews that were previously not recommended may be restored to recommended status.
AI, Machine Learning, and Large Language Models: The company uses AI, including machine learning, to power and enhance features across its platform. Deep learning neural networks model user behavior to select the most relevant ads to display and predict which photo shown in an ad will generate the most clicks. The company uses large language models (‘LLMs’) to better understand user intent in search queries and enhance its search capabilities, including by determining the most relevant information from reviews to display in the business highlights that appear in search results. LLMs also play an important role in analyzing user-generated content to protect consumers and business owners from malicious or harmful content.
Mobile Solutions: With the company’s most engaged users on its mobile app, it has invested significant resources into developing a comprehensive mobile platform for consumers that supports both major smartphone operating systems available today, iOS and Android. Similarly, the company designed its Yelp for Business app to make it easier for businesses to engage with their customers and manage their presence on Yelp. Currently available for iOS and Android, this app provides businesses with daily metrics reports, page view analytics, and leads data, as well as the ability to manage quote requests and opportunities in Nearby Jobs. Businesses can also purchase, customize, and manage Yelp Ads through the Yelp for Business app.
Ad Delivery: The company uses proprietary ad targeting and delivery technologies that are designed to quickly target and display hyper-relevant advertisements to users of its platform. When a consumer enters a search on its app, these technologies determine the most relevant ads to show and serve those ads alongside the organic search results, typically in less than half a second. The company’s targeting software leverages neural networks that evaluate more than 4,000 signals about the user, business, and search context to make sure consumers see the right ad at the right time and drive ad clicks.
Auction System: The company uses an auction system to determine the price it charges advertisers for ad clicks. The company’s auction system uses advanced algorithms to bid on ad placements on behalf of advertisers, taking into account their budgets, current and predicted levels of relevant consumer traffic, changes in user behavior, and competition from other advertisers, among other things. These bidding algorithms are also designed to prioritize spending advertiser budgets efficiently and maximize ad clicks, with the goal of delivering as much value to advertisers as possible. For example, if the company’s models predict that relevant consumer traffic will meaningfully decrease for a period of time during an ad campaign, its bidding algorithms will dynamically allocate advertiser budget around that period to avoid spending a disproportionate amount of the budget while supply is constrained. To conduct an average of nearly 18 million auctions per day, the company predicts demand for 16 million ad categories and distinct time intervals to set bid pricing and pacing, then optimizes bids 96 times per day per advertiser.
Infrastructure: The vast majority of the company’s platform is hosted by Amazon Web Services (‘AWS’) from multiple locations, which allows it to scale its infrastructure dynamically according to demand, as well as optimize the cost and performance of its infrastructure. The company’s platform is designed to have high availability, from the Internet connectivity providers it chooses, to the servers, databases, and networking hardware that it deploys. The company designs its systems such that the failure of any individual component is not expected to affect the overall availability of its platform. The company also leverages other third-party cloud-based services, such as content delivery networks, rich-content storage, map-related services, ad serving, and bulk processing.
Network Security: Computer viruses, malware, phishing attacks, denial-of-service, and other attacks and similar disruptions from unauthorized use of computer systems have become more prevalent in the company’s industry, have occurred on its systems in the past and the company expects them to occur periodically on its systems in the future.
Intellectual Property
The company pursues the registration of its copyrights, trademarks, service marks, and domain names in the United States and in certain locations internationally. The company’s trademark registration efforts have focused on gaining protection for the word mark ‘Yelp’ and the Yelp burst logo, among others. The company also has only limited patent protection for its core business.
Competition
The company’s competitors consist of companies that help businesses — particularly businesses in its strategically important Services categories, and to a lesser extent, restaurants category — connect and engage with consumers, including:
Online search engines and directories, including those incorporating AI technologies, such as Google and OpenAI, as well as traditional, offline business guides and directories;
Online and offline providers of consumer ratings, reviews, and referrals, such as TripAdvisor, as well as social media platforms and features where consumers are increasingly searching for and posting information about local businesses, such as TikTok and Reddit;
Providers of online marketing and tools for managing and optimizing advertising campaigns, such as Google, Instagram, and increasingly, food ordering and delivery services that also offer online advertising, such as DoorDash;
Providers of various forms of traditional offline advertising, including radio, direct marketing campaigns, yellow pages, and newspapers;
Restaurant reservation and seating tools, such as OpenTable and Resy, as well as food ordering and delivery services; and
Home and/or local services-related platforms and offerings, such as Angi and Thumbtack.
Government Regulation
The company relies on laws limiting the liability of providers of online services for activities of their users and other third parties, such as Section 230 of the Communications Decency Act (‘CDA 230’) in the United States.
Seasonality
Based on historical trends, the company’s revenue in a particular year is typically lowest in the first quarter of that year and increases sequentially through the third quarter. Fourth quarter revenue is typically similar to the third quarter, as well as to the first quarter of the subsequent year. Ad budgets for its multi-location customers typically increase throughout the year, generally starting the year at their lowest and peaking in the fourth quarter, while SMB ad budgets tend to decrease in the fourth quarter. With regard to expenses, the company generally decreases its marketing expenditures in the fourth quarter before increasing them again in the first quarter of the following year. The company’s personnel expenses tend to increase from the fourth quarter to the first quarter due to the timing of payroll taxes and benefits, as well as its annual compensation cycle. The company’s traffic is also typically weakest in the fourth quarter of the year (year ended December 31, 2024).
Research and Development
The company’s research and development costs were $310.5 million for the year ended December 31, 2024.
History
The company was founded in 2004. It was incorporated in Delaware in 2004. The company was formerly known as Yelp! Inc. and changed its name to Yelp Inc. in August 2012.
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