Yelp advertising is a rip-off for small advertisers
February 13, 2012 | Online Marketing
Yelp’s business model is closer to that of yellow pages companies: sell a questionable value proposition to many who don’t understand what they’re buying. While it may work in the short term, it’s not a long term proposition.
At a time when much online advertising is being sold for 60 cents per thousand impressions (CPMs), Yelp is charging some local advertisers $600 per 1,000 impressions.
That’s not a typo. Yelp is charging small businesses 1,000-times the standard online CPM rates for local ads that appear on Yelp. Even when compared to its own ads for national advertisers, the company is charging a 100x premium.
To make matters worse, Yelp requires a 12-month commitment for these rates. Even if Yelp doesn’t deliver your business a single customer, you’re on the hook for $3,600.
For comparison, Facebook only requires that you set your budget to $1 a day and does not have a commitment. A business could try it for a week, see if it performs and then decide.
Get the full story at Venture Beat
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