Growth Matters: Qype finds the best local services
Filed under: Technology
With all the gloom in the global economy, I got to wondering whether there is anything else going on in the world of business. I'm looking for growth because I think that's what will ultimately bring the economy out of the doldrums. Not surprisingly, that growth is coming from technology companies. In Growth Matters, I look at consumer technology companies that point the way to growth trends -- and in the process introduce services and products you may want to explore.
If you're new to a city or town, how do you find out where the best dry cleaners and restaurants are? If you've used Qype then you've got your answer. I interviewed, Andrew Hunter, General Manager Qype.co.uk, who said, "Qype is your local community online. It's a great way for people to discover the best places in their local area -- from restaurants and bars to libraries and book stores. Qype is also a great way for local businesses to connect with their existing audience and attract new customers."
Qype has grown substantially. According to Hunter, "Qype was founded in November of 2005, and since then has become the largest user-generated local review site in Europe. [Qype is] present in 9 markets with 250,000 active users and 1 million user-generated reviews. The site attracts over 7.5 million unique visitors every month and is growing fast."
Qype makes money in two ways: fees from service providers and advertising. According to Hunter, Qype generates three kinds of fees from service providers: "Referrals, affiliation, and our own premium listing product. [Qype is] particularly proud of the premium listing service since it allows businesses to showcase themselves on Qype. It also generates revenues from traditional display ads."
If Qype can help local businesses build their revenues in an economic downturn, it will be a valuable service to the economies in which it operates. If you've used Qype, what do you think?
Peter Cohan is president of Peter S. Cohan & Associates. He also teaches management at Babson College. His eighth book is You Can't Order Change: Lessons from Jim McNerney's Turnaround at Boeing. He has no financial interest in the securities mentioned.
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Reader Comments (Page 1 of 1)
3-09-2009 @ 10:27AM
Jones said...
Thanks for this - a question though. How do you view Qype as something different than either an online yellow pages / Superpages, or other recommendation "social-local" sites like Yelp, trustedplaces, welovelocal, etc? Or for that matter, other incumbents like Google or Yahoo! local which provides information, reviews and advertising on various platforms?
What is it about either Qype or any of the other social-local players that has led you to believe that there is a unique and differentiated (proven) value creation model at play that will ultimately accrue to the businesses involved, that is currently not available?
It would be great to hear your response.
Many thanks
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3-11-2009 @ 6:40AM
Ian Hendry said...
I see a flaw in the reviews model that sites like Qype, TrustedPlaces and other use and it's this: the value of recommendations from strangers, who you can't authenticate.
Social networks are well established and connect everyone up to everyone else they know. People would rather take the word of a trusted contact than listen to the advice of strangers, especially where you can't authenticate them or understand the context in which it is given -- one person's "perfect restaurant" may be another's living Hell.
The biggest rivals the best established sites in this space have is people just going online and asking their Twitter followers or Facebook friends for personal recommendations.
Ian Hendry
CEO, WeCanDo.BIZ
http://www.wecando.biz
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