What Yelp! Is Doing Right – Building a Successful Online Community

Ok, I never really got into Myspace. Sure, I signed up (because all my friends were on there) and was an active member for a couple months, but I felt something missing. It was useful for keeping in contact with friends and people I had not talked to since college and some of the videos and clips were pretty funny. Unfortunately, it just didn’t add much to my life (in terms of meeting interesting people, or learning valuable information – other than of course Jean Claude Van-Damme dance moves from the 80s). When it comes down to it, between all the social networking sites and blogs, you can find an endless amount of information. But at the end of the day, have you really done anything more than entertain your brain and spend a lot of time that could be used towards fulfilling your goals?

So, about a month ago (granted a short period of time to accurately review), I discovered the social community of Yelp! While MySpace is geared towards the legions of baby busters who were raised and live on the internet, Yelp! is more of a hybrid; an online community built on creating and reviewing experiences in the real world. Now, we’re getting somewhere. In addition to the site having a great layout, look, and feel, the community is full of people who want to do things, rather than have life pass them by. The question is will it be able to scale on the level of Myspace of Friendster -- probably not as their average demographic is 25 – 40, a group that had considerably less free time to waste than MySpacers. Also, the community requires more of a commitment from its users than a Myspace or similar site.

In terms of popularity, the 2 year old company faces some competition from CitySearch, Judy’s Book, and Google. But, Yelp! leads the game in site sophistication and local marketing; with community managers hosting regular parties for the regular (elite) contributors. The site started in San Francisco, and has proved successful in other cities like Los Angeles and New York, and is expanding nationwide. Now the most important question, can it make money? Well, Silicon Valley seems to think so. Yelp! is well financed and former Paypal co-founder Max Levchin is an original backer. What is for certain is that your local Yellow Pages are a dying dinosaur. Nobody uses the Yellow Pages anymore, and they will be obsolete within the next decade. If companies decide to shift that targeted advertising money to sites like Yelp, the company will be well positioned to profit.