Three years after Singapore, Yelp finally enters Malaysia
By Edwin Yapp May 7, 2015
- Listings and reviews site launches with Malay and Mandarin language support
- To build community, brand and following before monetisation happens
ONLINE classifieds and review website Yelp.com has officially launched in Malaysia, three years after it entered the South-East Asian market via Singapore in 2012.
Yelp Inc vice president for new markets Miriam Warren (pic, above) said the Yelp app and website are a great fit for Malaysia’s highly connected citizens.
With the launch of Yelp.my in Malaysia, people who would like to make localised searches for anything from nasi lemak (a local delicacy) to teh tarik (pulled tea) can now do so with the touch of a button, she said.
What’s more, users can now even get reviews of these places that serve such local delicacies, she told at a media briefing in Kuala Lumpur on May 6, in conjunction with the launch of the localised website Yelp.my.
“Malaysians have over 40 million mobile devices and the vast majority of the country uses social networks regularly.
“Given that they are so digitally-savvy, we believe they are going to love using Yelp to find great local business and be guided by its recommendations,” Warren said.
San Francisco, California-based Yelp is an Internet firm that helps users find local businesses through its app, which is designed to display businesses such as shopping malls, restaurants, health, home and automotive service vendors, and hotels on a map.
Users are able to read recommendations of the places and businesses they search for based on views that are crowdsourced and collated via other users and by Yelp.com community members, using a one-to-five star rating system – one that is not without controversy (see below also).
Warren claimed that with Yelp.my going live today (May 7), there are more than thousands of local listings and reviews available for users. These numbers, she said, will increase as the site continues to grow.
According to company data, the average monthly unique visitors for the first quarter this year globally is 142 million. The average monthly mobile unique visitors and the average monthly desktop unique visitors are 79 million and 80 million respectively.
Since its inception in 2004, there have been about 77 million reviews written on Yelp globally.
Founded by former PayPal Inc executives Jeremy Stoppelman and Russel Simmons at business incubator MRL Ventures in 2004, Yelp makes money by selling ads to local businesses, listings that are clearly labelled as ‘Yelp.com Ads’ on the site.
The company went public in March 2012 at a share price of US$15, valuing it at US$898 million then, according to CNN Money.
In Asia, Yelp operates in Japan, Taiwan and Hong Kong, besides Singapore and now Malaysia. Globally, it is now present in 31 countries, including its home base of the United States, and spanning Europe, South America, Australia and New Zealand.
Asked why it took so long for Yelp to arrive in Malaysia, Warren said that it was because it “takes energy, people, time and resources to prepare,” and as such, the company has to be “selective about which markets it goes into.”
“Historically speaking, we go into two to five markets a year, and the Asian region is extremely nascent [for us],” she said.
“And when we launch in a new market, we want to make the Yelp app as useful and as localised as possible,” she added, alluding to the preparation needed to set up local business listings, local language customisation, as well as to ramp up the reviews on the site.
Pressed as to whether Yelp is going to enter other South-East Asian nations, Warren was coy, noting only that “there is no news to share about other countries in the region.”
No monetisation in Asia
One major challenge that has dogged Yelp for some time now is the slowing growth in its home market in the United States, and in parts of Europe.
As recently as a week ago, the company reported lacklustre earnings in its first-quarter, with revenue ending below average analysts’ estimates, as the company added fewer-than-expected local advertising accounts, Reuters reported.
The news agency noted that Yelp makes some 83% of its total revenue through local advertising accounts, a mechanism by which advertisers pay it a certain fee to advertise their products and services on its site.
Bloomberg reported that the company’s shares fell 23% to US$39.36 at the close on April 30 in New York, the biggest single-day decline since its March 2012 IPO (initial public offering), and its lowest value since July 2013.
The Wall Street Journal noted that this is the second consecutive quarter that the company reported slower growth, even as the site posted a narrower loss and higher revenue in the March quarter.
Analysts have noted that Yelp has been stepping up efforts to expand in markets outside the United States and it has also been diversifying into other businesses such as restaurant bookings, event management, and payments, mainly through acquisitions.
For instance, it purchased food-ordering service Eat24.com in February in a cash-and-stock deal valued at US$134 million, Bloomberg reported.
In a statement during its earnings call, founder and chief executive officer Stoppelman said the company was continuing to “seek ways to increase engagement and drive awareness” and was confident there remained a “large local advertising market opportunity.”
Asked if any of its overseas expansion, including that in Malaysia and Singapore, is a means of shoring up revenue for the company’s global business, Warren revealed that Yelp has not yet monetised anywhere in Asia, not even in markets like Japan, Taiwan and Hong Kong.
“What we first have to do right now is to make Yelp really useful in Malaysia and this process is a long road for us,” she said.
“There are no fact and figures to share as far as expectation of revenue in this region because that’s not what we’re working on.
“What we are focused on is building Yelp in Malaysia [and in Asia] and we’re actually working on content generation and building our communities up,” she said.
“Eventually, at some point in the future, we’ll be monetising [in Asia] like we do in the nine other countries. But that’s not part of the very near-term plan, just like in every new market we enter,” she added.
Besides slowing account acquisitions and revenue, businesses have alleged that Yelp uses the threat of negative reviews to convince local businesses to buy advertising, according to Bloomberg.
The business daily said Yelp has worked hard to dispel those claims, defending the way it filters fake reviews in court and in a series of long blog posts.
According to Warren, Yelp.com uses automated software to recommend the most helpful and reliable reviews for the Yelp community among the millions it gets. The software looks at dozens of different signals, including various measures of quality, reliability, and activity on Yelp.com.
The process has nothing to do with whether a business advertises on Yelp or not, she argued.
Asked if the automated software could weed out biased reviews with local colloquialism taken into account, especially in languages such as Bahasa Malaysia and Mandarin, Warren said the system has been designed to detect such variations, but she was also quick to point out that not everything might work as planned.
On Yelp’s plans for Malaysia, Warren revealed that the company is in the process of hiring a local community manager who will act as a ‘one-stop person’ to handle all aspects of promotions, marketing, and building the Yelp community.
Asked if one person would be sufficient, given the wide scope of work, she said she was confident that this could be done since this is how Yelp began in the markets it operates in.
“The community manager will be tasked with taking care of all aspects of social media, promotions, engaging journalists, marketing partnerships and promotions,” she said, adding that “it’s pretty amazing what one right person can do.”
The Yelp app is available on Apple App Store and Google Play Store. Businesses which want to register with Yelp.my can surf to biz.yelp.my to set up their Yelp business page.
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