Yelp sees huge decline in restaurant demand, offers $25MM relief package

Yelp is seeing a sudden and massive shift in demand among consumers engaging with local businesses on its platform, according to the company’s internal data. The coronavirus represents a kind of existential threat to a substantial number of small businesses, as more cities issue “stay at home” orders.

Yelp’s relief package for bars and restaurants. Friday, Yelp CEO Jeremy Stoppelman announced a plan to help support local businesses, primarily in the restaurants and bars categories, but not exclusively. Yelp is offering the equivalent of $25 million in credits, waived fees and support, which takes the form of:

• Waived advertising fees
• Free advertising
• Free access to Yelp page upgrades
• 90 days of free access to Yelp Reservations and Waitlist  
• $100 in free search advertising to restaurants with delivery/takeout
• Support for local advertisers “in other categories that are struggling to pay their bills”

According to internal Yelp data, consumer engagement with restaurants “has fallen by 54% and for nightlife businesses by 69%,” Yelp says. However, grocery stores are up 160%. Home fitness is up as well, as are “interest in buying water and guns (up 166% and 360% respectively).”

Impact of coronavirus on local business engagement on Yelp

Additional features and communication tools for SMBs. Yelp also said that the company was working on other ways to “make it easy for Yelp users to support local businesses they love” and would share those plans soon. The company added that there would be “new free features that will help local businesses stay connected with their customers.”

Yelp will also be updating its iPhone and Android apps to offer a contact-free delivery option during the checkout process (via Grubhub). Other updates or changes include:

• New functionality to enable restaurants to indicate if they’re open for delivery and takeout
• A banner alert for business profiles with a customer message
• The ability to indicate if businesses are temporarily closed or have changed hours of operation
• The ability to communicate virtual services, online classes or consultations, “along with search functionality that will make these virtual services easy for people to find”

Updated review guidelines to protect business owners. In a move that will be cheered by business owners, Yelp said that it has updated review guidelines “to protect local businesses from reputational harm related to these extraordinary circumstances.” It will not permit, for example, claims in reviews of contracting coronavirus from a business or its employees or “negative reviews about a business being closed during what would be their regular open hours in normal circumstances.”

It added that flagged reviews will be evaluated by humans and that content violating these new guidelines “will be removed and not count toward a business’s star rating.” Lastly, the company announced a resource hub with a range of helpful information for small businesses.

Why we care. Earlier this week, Facebook announced $100 million in grants to help 30,000 small businesses in 30 countries where Facebook employees “live and work.” It’s a larger and broader program than Yelp’s but also includes advertising credits on the platform. Cynics may see Yelp’s and Facebook’s moves as self-serving — and they are to a degree — but it’s critical that local businesses get all the help they can, from whatever sources available, including marketing and advertising support.

Yelp’s efforts also highlight the rapid strategic shifts companies are undertaking to try to support and sustain their businesses and audiences during this time. Nextdoor rolled Groups out of beta and launched a Help Map this week in response to the coronavirus.