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Why Facebook will buy Yelp

Robert Scoble had an example at one of the SXSW panels on how the “check-ins” we were all getting from Gowalla and Foursquare (“Jim Wood has just checked in at the Blogger’s Lounge”) could be made useful, instead of annoying.

Suppose he wants a recommendation for a barbecue place in Austin. He’s going to browse among his thousands of contacts for the handful of people who have completed the Gowalla BBQ hunt, requiring them to check in at six different BBQ spots. He can assume they know more about BBQ than 99% of the rest of us, based purely on their activity stream.

Of course, we don’t know if these reviewers have good taste in barbecue, but there are  tools for that as well. It’s what is done on Amazon and Yelp, where reviewers gain authority based on how active they are and how useful their reviews are to others. Combine an authority ranking system with check-ins and you’re getting some pretty good info, all auto-generated.

The biggest user of check-ins will soon be Facebook, the 800 pound gorilla that nobody at SXSW wants to talk about even though they reccently surpassed Google as the #1 Internet destination on the Web in terms of daily visits. Facebook users are already conditioned to share their activity streams with their friends anecdotally, and Gowalla and Twitter are adding links to make those streams geographically meaningful (Gowalla through geolocation, Twitter through its newly added “location” feature). You’ll know how popular your local Starbucks is with your friends and how often your best friends can be found there.

And wouldn’t it be great to add to this a coolness factor, what the smart and savvy kids are recommending? Well, that’s what Yelp is for. How about adding a Yelp tab at the top of your Facebook page where, after you visit a place, you can Yelp it? How about assigning reward points for the frequency of Yelp reviews; wouldn’t that be at least as satisfying as feeding the animals in Farmville?

Facebook also gains a bunch of new users (plus many already on Facebook who will become much more active) and a sales force trained in micro-targeting local businesses. It’s just too good a fit not to happen.

One Comment

  1. Ed wrote:

    Facebook would do well to add their own reviews mechanism. I doubt they’d get many more users because they are so much larger than Yelp already.

    Yelp’s traffic is declining (see to check it out). I think their reputation has been damaged by a combination of the lawsuits against them and general concerns about how they filter reviews.

    I’d much rather see Facebook create their own review capabiltiy…that would be cool.

    Sunday, March 21, 2010 at 12:46 pm | Permalink

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