Advertising on Yelp: What you should consider

by Toby

July 30, 2019

yelp ads on mobile device

The goal of this post is to provide you with unbiased objective insights into Yelp’s advertising platform before you commit advertising dollars to it. My perspective is that of an agency that has worked with hundreds of businesses nationwide in deciding where best to allocate digital advertising spend that will provide the most profitable return.

As you read through the post, don’t forget to read the comments others have left at the bottom of this post for additional insights – hundreds of people have left their comments on Yelp’s advertising programs.

Without further ado…

First, understand how Yelp charges local businesses.

What Is The Cost To Advertise On Yelp?

Yelp charges you based on CPC (cost-per-click). The CPC you pay varies widely – advertisers will pay as low as $0.30 per click (for some food establishments) to $40+ per click for more competitive niches like law. You can choose how much you want to spend monthly.

Yelp has plenty of online awareness with consumers since it is considered by many as #1 online review site (a survey we did here actually found that Google reviews were more important). Its awareness with consumers alone is enough to take notice of what ad options it provides to reach these people.

Clients often ask us, “should I advertise with Yelp?” But often I would defer to Google Ads/PPC as a better option. I have been skeptical of what Yelp can deliver in terms of leads and prospects and whether it could deliver a positive return on advertising spend.

I would tell clients if you’re getting results on Google, and there’s more inventory still available, add to your Google budget.

However, I have placed eager clients on Yelp from various industries.

In this example, one client was in Houston, the other in an affluent Southern California area.

I figured it was worth a try, minimal risk, and I thought maybe the consumers on Yelp were just as far along in the sales funnel to become a prospect as a Google Ads/PPC visitor.

Yelp Advertising Activity Metrics
Yelp Advertising Activity Metrics – Before Yelp Ads and After Yelp Ads

It doesn’t make sense to put a call tracking number anywhere in Yelp (absolutely don’t use a call tracking number in your Yelp profile if you care at all about local SEO efforts with Google).

Without call tracking, you must rely on asking consumers how they found you when they call your business (this is a horribly inaccurate and unreliable way to collect data). Yelp does, however, provide metrics, like page views, or ad clicks and other metrics in its dashboard.

As with any channel online – Yelp, Facebook, Google, YouTube – it’s pay-to-play if you want more exposure. As you can see in the above Yelp chart, impressions in yellow are showing when we started advertising on Yelp — an increase in exposure.

Now look at the below chart showing “Customer Leads” for last 6 months of the year within its ad platform – this specific business has a large Yelp ad budget.

Yelp Advertising Activity Metrics

The word “Leads” should be used very lightly when looking at these ad metrics.

Most business owners I know define a lead as someone that called their business or submitted a form from the website, purchased a product, or drove to the business (although asking for directions is often a repeat customer for many businesses, not a unique lead). This business didn’t receive 7,126 real leads from Yelp (at least not how the business owners define a lead).

Here’s how Yelp classified the 7,126 leads:

The Different Buckets Yelp Classifies Your Leads

Yelp has 8 differnt classifications for leads – out of those 8, how many would you consider a lead? Are user uploaded photos a lead? What about clicks to your website? The majority of these are not leads at all.

With any of the tests we’ve run with Yelp ads, we’ve never been able to verify how many “real” leads a business received.

Website Traffic From Yelp

When looking through the website’s analytics, Yelp ads drove very low bounce rate traffic (a bounce means someone didn’t stay long on your page and left immediately – low bounce rates are considered a good thing). The bounce rate of traffic coming from Yelp to your website is often in the 25-30% range which is very good when comparing it to other referring sources and websites.

But in general, Yelp sends very little traffic through to a website as most people stay on the site or app if they are on mobile devices. And Yelp’s ads do not send traffic to your website.

[Tweet “Consider these issues before you advertise on #Yelp”]

Geotargeting Of Yelp Ad Campaigns – It’s A Mystery

In the past, there had been no way to set your geotargeting – where will your ads show?

However, Yelp now provides a couple of options – depending on which industry your business is in.

For our client who owns a salon, the options are (related posts here, Google Ads For Beauty Salons, Facebook Ads For Beauty Salons):

  • 5-mile radius
  • 10-mile radius
  • 15-mile radius.

For our client who owns a home remodeling company, the options are:

  • 10-mile radius
  • 15-mile radius
  • 25-mile radius.

When we reached out to a Yelp representative for an explanation of how the different geotargeting options are determined, they vaguely responded that service-based businesses will have a wider radius than local brick and mortar businesses.

However, these options are still very limiting for advertisers.

If the bulk of your customers are less than 5 miles you will have wasted ad spend, or if you are a franchise with competing locations within that 5-mile radius you will have ad spend that is overlapping. There’s no way to dial that in further.

Yelp Ads Geo Targeting Options For A Salon Business
Yelp Ads Geo Targeting Options For A Salon Business

yelp advertising geo targeting radius options
Yelp Advertising Geo Targeting Radius Options

If you use Yelp ads, you need to absolutely understand your geotargeting to know if you are wasting ad spend outside of your target area.

What Keywords or Topics Is Yelp Showing Your Ads For?

Like the geo-targeting issue, there’s minimal transparency in what keywords or topics your business is showing for. Unlike Google Ads where you have complete control over the keywords and topics, you have a limited idea in the Yelp ad platform.

That’s the scary part – how much ad money are you wasting on keywords or topics that are not relevant to our business?

Yelp does let you choose the categories you show in, however. Some of these categories may be very wasteful for your business to show in.

For example, we have a plumber client that specializes in water leak detection and water damage restoration. For this client, paying to show ads for general plumbing related searches is a huge waste of ad spend.

What Does Yelp Do Well?

Yelp does a good job with SEO and ranking its pages in Google search which means potentially more exposure for you as a Yelp advertiser.

Many queries in Google will show Yelp pages appearing at the top of the organic listings below the Google local 3-pack (see screenshot below).

Here’s an example – this was for a plumbing related query. The first 3 organic listings below the Google Local Pack are all Yelp.

Yelp search page ranking in Google organic results
Yelp search page ranking in Google organic results

But hold on…

Don’t expect your business’ Yelp page to rank in Google – most of Yelp’s pages ranking in Google are its category or search pages not individual business pages. The key point is that if you’re advertising on Yelp, you do have the opportunity to capture more traffic than just Yelp’s own internal traffic – in this case, the organic traffic that’s coming from Google as well.

Diminishing Returns For Yelp Advertisers

The SEO benefit of increased traffic inside Yelp coming from Google is not that great to Yelp advertisers.

Because Google is dominating the top part of its search pages so well with its own properties (Google Ads, Google Local Packs of 3 listings, Featured Snippets ranking in position 0, etc), it’s increasingly difficult for Yelp to continue to acquire non-paid traffic from Google organic searches and thus deliver more traffic to Yelp advertisers.

This trend with Yelp’s pages ranking in Google is most evident with service-based businesses where Google shows the following properties ahead of Yelp pages:

  • Google Home Services at the top
  • Followed by Google Ads/PPC
  • Then followed by a local 3-pack of organic listings

Google pushes the Yelp organic listings way below the fold and below its own properties.

In Summary

Overall Positives

  1. Yelp ads will increase your exposure inside Yelp
  2. Yelp advertising options have become more flexible for advertisers removing contracts (pay-as-you-go options are available with no long-term contracts)
  3. There’s plenty of awareness with consumers that Yelp is a reliable source for reviews (that’s subjective of course) so Yelp is likely to maintain its own traffic for some time
  4. Yelp ranks its own pages well within Google although this is diminishing possible returns to Yelp advertisers
  5. Low bounce rate traffic is sent through to your website (although overall not much traffic is sent to your site from your Yelp page)

Overall Negatives

  1. No transparency on what keywords or topics you’re spending your ad dollars on (you can choose categories where your ads show, however)
  2. The Yelp app skews to a younger demographic which may not align to your target audience if you’re advertising (the younger demographic was uncovered in our survey)
  3. Difficult to verify the true economic value of leads coming from Yelp ads (compared to other paid channels like Google and Facebook)

Why We Pulled the Plug on Yelp Advertising

Nonetheless, at the end of the day for the original business owner at the top of this article that I mentioned, we calculated a much higher cost per call and far lower ROI than with the Google PPC campaign we were running. So we decided to put Yelp ads on hold and put the budget into other more productive tactics, primarily Google Ads (a related post here compares Yelp to Google Ads).

I have numerous clients on Yelp, and none have received strong, promising results. I have seen exceptions, of course, particularly in some legal fields where the Google Ads CPC (cost-per-click) has gotten so expensive that the return on ad spend becomes questionable and they have found success using Yelp ads.

In summary, I’m not advocating you not use Yelp, but I would minimize your budget exposure to Yelp until it proves itself.

In Yelp’s defense, they’ve always stated the best results occur after you’ve been advertising with them for an extended period…take that for what it’s worth (kind of like the fox that guards the henhouse).

Most businesses with a finite ad budget are better off utilizing a comprehensive Google PPC campaign integrated with remarketing, and Facebook ads, and Facebook remarketing — after all just about everyone on desktop or mobile visits either Google or Facebook every single day, if not multiple times per day, but not everyone is on Yelp with anywhere near that frequency.

Have you advertised on Yelp? What are your thoughts?

Related post: How to get rid of negative Yelp reviews.

And, How To Respond To Negative Online Reviews

Survey Results of Which Reviews Sites Consumers Prefer: Top Review Sites For Consumers – Survey Results

About the author 


Toby is the co-founder of 39 Celsius. He has over 20 years of digital marketing experience and has started several different companies throughout his career.

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