How Yelp Used A Freemium Model & Layered On Sales

covered categories a little bit there. But as far as when it comes to like go-to-market and expansion strategy, how does kind of sales align with that? In some ways, you can almost think about Yelp as the largest freemium model for SMBs of all time. And so all of the SMBs are on Yelp, right, whether they want to be or not. Now their, their customers want them to be there. So they're there. And so what ends up happening now is you have all the businesses that are on there, And they're getting business from people finding them on Yelp. They're getting phone calls, they're getting map directions, so on and so forth. So again, you can think about it like a freemium type go-to-market strategy. Then the sales team comes in and they start contacting businesses and say, hey, looks like you've got great reviews. Looks like you're getting a lot of leads from Yelp, which you can see all that on the backend, which is a great thing about, you know, working at the team there. And then you say, we have an ad product that you're already getting some business, we can 5x it or whatever that number is through the ad product. And so that was really the go-to-market strategy around that. So when we were looking at, okay, who do we contact? You could have a restaurant that has 1,000 page views and you can have an auto repair shop that has 50. That auto repair shop that has 50 page views actually might be more interested in advertising because the average customer value is higher and because they can track the leads more clearly. So they know that they're actually getting business from Yelp because they ask everyone, whereas the restaurant with 1,000 page views doesn't know that. And so when you think about, okay, how do you optimize with this freemium strategy and start selling advertising, you can see where, hey, let's start to optimize around that business owner who both understands that they're already getting business And then it's going to be able to track the ROI from the advertising perspective. So it was really a mix of both, but I think you can almost think about it like a freemium type strategy on the supply side for acquiring the businesses and then layering a sales strategy on top of that targeted to the businesses that are most likely to convert to the paid product. And, you know, the secret is when you're cold calling into local businesses, when you call the plumber, you're getting their cell phone. they pick up versus, you know, someone at the restaurant who is going to hang up on you. I mean, I think curation on the supply side for marketplaces is such an important topic, right? And so you think about if you're building out the supply side, you know, there's some marketplaces that I work with now that are building out the supply side. And, you know, you may have a bunch of businesses who want to join that marketplace, they want to be on the supply side. And so you think the product market fit is really strong there. because they're converting, right? And they're interested and they're joining, but really the quality and the curation around the supply side is maybe not those businesses you want to join. It's the businesses that deliver more value to the demand side of the marketplace, right? And you think about the early days of OpenTable and their goal was to get some of the top restaurants in the category, and they were a lot harder to acquire on the supply side, but they drove a lot more value on the demand side. And I've seen that play out again and again with a lot of marketplaces. And when you apply a sales function to acquire supply, sometimes the reason you do that is because curation is really important and acquiring the right supply drives more value on the demand side. So therefore, having a sales team driving that is more effective than just having it be sort of an open self-serve marketing type driven strategy.