As our community
has grown and our product offerings have expanded, we have seen significant
growth in reviews, traffic, claimed local business locations and active local
- Our users have contributed a total of
approximately 36.0 million cumulative reviews to our platform as of December
31, 2012, up 45% from the prior year. Of these reviews, approximately 25.1
million were available on business profile pages, approximately 8.1 million
were being filtered and approximately 2.7 million had been removed from our
platform, as of December 31, 2012. Although they do not factor into a
businesss overall star rating, we provide access to filtered reviews because
they provide additional perspectives and information on reviewed businesses,
as well as transparency of the efficacy of the filtering process.
- We had approximately 86.3 million
unique visitors on a monthly average basis for the quarter ended December 31,
2012, up 31% from the same period in the prior year.
- We had approximately 994,000 claimed
business locations as of December 31, 2012, up 64% from the prior year.
- We recognized revenue from
approximately 40,000 active local business accounts for the quarter ended
December 31, 2012, up 68% from the same quarter in the prior year.
The approximately 36.0 million cumulative reviews our users contributed through December 31, 2012 cover a wide set of local business categories, including restaurants, shopping, beauty and fitness, arts, entertainment and events, home and local services, health, nightlife, travel and hotel, auto and other categories. We believe this breadth of content across business categories provides consumers with a wide-ranging selection of reviewed businesses as they search across many categories. We highlight below the breakdown by industry of local businesses that have received reviews on our platform and the breakdown by industry of reviews contributed to our platform through December 31, 2012. The charts below include information based upon all contributed reviews and include some businesses that have only received reviews that are being filtered or have been removed.
generate revenue primarily from the sale of advertising on our website and
mobile app to local businesses and on our website to national brands that seek
to reach our growing audience of consumers. During the year ended December 31,
2012, we generated net revenue of $137.6 million, representing 65% growth over
2011, a net loss of $19.1 million and an adjusted EBITDA of $4.6 million. For
information on how we define and calculate number of contributed reviews, unique
visitors, claimed local business locations, active local business accounts and
adjusted EBITDA, and a reconciliation of adjusted EBITDA to net loss, see
Data in this Annual Report. The top five industry categories accounted for an aggregate of approximately 76% of our local advertising revenue for the quarter ended December 31, 2012, broken down as follows: Home & Local Services, 22%; Restaurants, 17%; Beauty & Fitness, 15%; Health, 11%; Shopping, 11%.
Our Growth Strategy
We intend to grow
our platform and our business by focusing on the following key growth
Growth in Existing
- Increase the Number of
Reviews. We will continue to
explore ways to enable contributors to share their local experiences through
detailed reviews, photos, tips and other forms of content contribution across
our platform. As we continue to grow our contributor and consumer footprint
within our existing markets, we expect to benefit from accelerating network
effect dynamics, further driving the growth of reviews, consumers and local
- Attract More Users.
We believe that we can increase
the number of consumers that use our platform. In December 2012, less than 16% of the total U.S. online audience visited our website or mobile app, as reported by comScore,
Inc., a company providing digital marketing intelligence. We believe that as
our brand recognition increases and the number of reviews on our platform
grows, our platform will become more widely known and relevant to broader
audiences, thus attracting new consumers to use our service.
- Increase Usage of Current Users.
By continuing to expand the
number of reviews across diverse categories, driving more claimed business
pages and providing a more feature-rich experience, we can increase the
number of visits and searches per user. Many consumers begin using Yelp to
search for restaurants and boutiques, but more than half of reviewed
businesses are in categories outside of restaurants and shopping. We believe
that there is a substantial opportunity for a larger percentage of our user
base to use Yelp to search in more categories.
- Attract More Businesses.
As of December 31, 2012, only
approximately 994,000 local business locations out of the approximately 47 million local
businesses on our platform had claimed their Yelp pages. We believe the
continued increase in the size of our audience of consumers, as well as our
efforts to provide additional tools to measure the effectiveness of our
products, will encourage local businesses to advertise on our