The report finds new restaurant and food
businesses are opening at pre-pandemic levels; more than 210,000
businesses reopen across the country
Yelp Inc. (NYSE: YELP), the company that connects people with
great local businesses, today released third quarter data for the
Yelp Economic Average (YEA) report, a benchmark of local economic
strength in the U.S. The report has been adapted to reveal the
dramatic impact COVID-19 has had on local economies, uncovering the
resilience of local businesses across the country. While our
September Economic Impact Report and the latest unemployment
figures show continued economic uncertainty, our data finds that
certain areas of the local economy show promising signs of
adaptability.
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the full release here:
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Yelp Economic Average finds that new
restaurant and food businesses are opening at pre-pandemic levels,
with the number of new openings increasingly more in line with 2018
and 2019 volumes. (Graphic: Business Wire)
YEA finds that new restaurant and food businesses are opening at
pre-pandemic levels, with the number of new openings increasingly
more in line with 2018 and 2019 volumes. In addition, 210,000
businesses have reopened that were once temporarily closed, with a
large increase of reopenings in September 2020. The report also
details consumer trends, surfacing outdoor dining as the breakout
hit of the summer, along with outdoor-related services businesses
and leisure activities. In its third quarter report, YEA reflects
data from millions of local businesses and tens of millions of
users on Yelp’s platform, measuring U.S. business openings and
reopenings, as well as consumer interest trends via search data,
page views, reviews and photos.
“Business owners have proven their resilience throughout the
course of this pandemic. Many have been able to successfully reopen
and keep their doors open by quickly innovating and adapting new
operating models to serve their customers,” said Justin Norman,
Yelp’s vice president of data science. “Restaurants in particular
have been tested in the last six months, but we’re now seeing new
restaurant and food business openings align with opening rates from
previous years. In what at times seems like a never-ending stream
of challenges for business owners, it’s encouraging to uncover
these bright spots in the local economy.”
New Restaurant and Food Businesses Continue to Open Amid a
Challenging Economy
In April, restaurants endured a large drop in new openings,
however in May a rebound had already begun, with a 29% average
monthly increase of new restaurant openings from May to July. New
restaurant openings have stayed relatively flat in August and
September, with approximately 6,600 new restaurants opening each
month. There were only 100 fewer new restaurant openings in
September of this year, compared to September 2019. New restaurant
openings in Q3 2020 are only down 10% compared to Q3 2019.
Compared to Q3 2019, Yelp observed an increase in brand new
openings in Q3 2020, nationally, for open air food services
including: farmers markets (211 openings) and food trucks (1,734
openings). In addition, pop-up restaurants (100 openings) and
seafood markets (84 openings) experienced an increase in openings
compared to the same period in 2019, catering to consumers'
interests in novel ways to dine and shop for food outside of
traditional restaurant experiences. Yelp data also indicates that
openings increased for food businesses specializing in celebratory
treats that are often enjoyed at home or purchased as gifts,
including cupcakes (494 openings), custom cakes (512 openings), and
desserts (1,615 openings).
Yelp measures community resilience by comparing the rate of
change of new openings in Q3 relative to Q2, removing seasonal
impact. Community resilience determines how well states have
rallied to open new businesses in Q3 compared to Q2 during the
pandemic. States that showed the most resilient third quarter for
restaurant and food-related business openings include North Dakota
(39 openings), Washington D.C. (108 openings), Rhode Island (69
openings), New Hampshire (103 openings), and Wyoming (34 openings)
— all with at least 2X the openings in Q3 compared to the previous
quarter. States with the largest total number of new openings in Q3
tend to be larger and heavily populated, including California
(3,279 openings), Texas (2,002 openings), Florida (1,542 openings),
New York (1,420 openings), and Washington (561 openings).
Business Reopenings Rise Across the Country in Q3
Amid a year of unprecedented challenges for U.S. small
businesses, more than 210,000 have reopened after temporary closing
(between March 1 and September 30). Yelp analyzed the reopening
trends in each state by comparing the change in reopenings
month-over-month.
After the initial outbreak of the pandemic, business reopenings
began in April when many states began to lift their stay-at-home
orders in exchange for more lenient regulations. Nationally, Yelp
data shows a sharp spike in business reopenings, month-over-month,
of temporarily closed businesses in April and May followed by a
decline in business reopenings in June and July – when cases
climbed again across the nation.
Case containment responses as a result of the early summer
spikes drove renewed momentum of reopenings in August and
September. States that experienced a 30% or more increase in
reopenings from July to August include: Louisiana (90% increase),
Montana (86% increase), South Dakota (55% increase), North Dakota
(50% increase), Iowa (34% increase), Indiana (35% increase), and
Wisconsin (30% increase). These reopenings continued into
September, when North Dakota, Alabama, Idaho, Wyoming, and Oregon
experienced more than 3X the number of reopenings in September than
in August.
While the average rate of reopenings have slowed overall since
April and May, Yelp data shows businesses are continuing to reopen,
particularly in September, as business owners adapt to changing
local regulations and fluctuating COVID-19 infection rates.
Reopenings Increase Across Financial Services, Education,
Active and Beauty Categories in the Third Quarter
Yelp’s September Local Economic Impact Report found that
businesses in home, local, professional, and automotive services
showed a lower closure rate than restaurant and retail businesses.
Now, Yelp’s reopening data supports a resurgence in demand for
categories that were previously pushed to temporarily close.
With school back in session, Yelp’s data indicates that
preschools, childcare and kids activities experienced high
proportions of their reopenings in Q3 relative to their total
category openings since March 1, with 55%, 53% and 48%,
respectively. People are returning to exercise classes with
kickboxing and martial arts experiencing 68% and 46% of their
reopenings in Q3. Beauty salons are also making a comeback with 44%
of reopenings for sugaring businesses and 43% of reopenings for
eyebrow services happening in Q3. Similarly, leisure activities
began to reopen at higher rates, including movie theaters, arcades
and amusement parks, all with 54% to 53% of their reopenings in the
third quarter.
A handful of home and local services businesses experienced a
large percentage of their openings in Q3, including locksmiths,
home appliance repair and bike maintenance with 60%, 53%, and 47%
of total category reopenings in the quarter, respectively. As
consumers navigate the effects of the pandemic on their personal
finances, many financial service providers experienced a majority
of their reopenings in Q3. Banks, financial advisors, tax services,
insurance companies and investing firms led the way, all with 68%
to 56% of their category reopenings in Q3.
Consumer Interest is Up for Outdoor-based Professional,
Local, Auto and Home Services
Throughout the summer, Yelp data showed an increase in customer
interest for all things outdoors. In Q3 2020, share of consumer
interest surged for businesses that repair and service bicycles
(104% increase from a year earlier), boats (75% increase), and RVs
(32% increase), while consumers’ general interest in RV parks (59%
increase) ramped up throughout the summer for both leisure and
socially distanced travel.
As the months heated up, consumers invested in making their
outdoor spaces usable. Share of interest in home services for pool
and hot tub services, and for landscape architecture, increased by
41% and 35%, respectively.
Outdoor Dining Spikes as Consumers are Eager to Head Back to
Restaurants
Outdoor dining was one of the biggest trends of the summer as
diners looked for ways to eat out while staying safe. In Q3 2020,
the share of U.S. restaurant reviews mentioning ‘outdoor dining’
was more than double the share in Q3 2019. And the share of U.S.
restaurant searches using the ‘outdoor seating’ filter on Yelp was
up more than 5X compared to the same time last year. Similarly,
review mentions for ‘street dining’ increased 5X between Q3 and Q2
2020. To meet this unprecedented consumer demand, restaurant and
food-related businesses moved their existing operations to
sidewalks and streets, and launched new ventures catering to the
demand.
Find Q3 YEA assets and images here, and all of our previous Yelp
Economic Average reports and other resources at
yelpeconomicaverage.com. For more information and Yelp’s latest
company metrics, visit:
https://www.yelp-press.com/company/fast-facts/default.aspx
Methodology
Business Openings Openings are determined by counting new
businesses listed on Yelp, which are added by either business
owners or Yelp users. New openings in this report are specifically
for restaurant and food categories. Openings are adjusted
year-over-year, meaning openings in 2020 are relative to the same
period of time in 2019 for the same category and geographic
location. This adjustment corrects for both seasonality and the
baseline level of Yelp coverage in any given category and
geography.
Business Reopenings On each date, starting with March 1, we
count U.S. businesses that were temporarily closed and reopened
through September 30. A reopening is of a temporary closure,
whether by using Yelp’s temporary closure feature or by editing
hours, excluding closures due to holidays. Each reopened business
is counted at most once, on the date of its most recent
reopening.
Openings and reopenings are based on when they're indicated on
Yelp, as such, the data may lag slightly from the true opening or
reopening date due to a delay in reporting from consumers and
business owners.
Resilience Community resilience compares the rate of business
openings per state from Q2 to Q3 in 2020 and adjusts for the
natural rate of openings in 2019 to determine how well states have
rallied to foster new business during the pandemic.
Mathematically, resilience is calculated as Q3 YoY adjusted
openings less Q2 YoY adjusted openings divided by Q2 YoY adjusted
openings. YoY adjusted openings are openings this year divided by
openings last year (for any given month/quarter etc.).
Consumer Interest By Business Category We measure consumer
interest, in terms of U.S. counts of a few of the many actions
people take to connect with businesses on Yelp: viewing business
pages or posting photos or reviews. Consumer interest for each
category is based on the Q3 year-over-year change in the category’s
share of all consumer actions in its root category.
Review Mentions and Search Filters For the data regarding
outdoor dining, we measured the share of total words in U.S.
restaurant reviews containing phrases related to outdoor dining.
Similarly, for search filters we measure the share of U.S.
restaurant searches using filters for takeout, delivery, or outdoor
seating.
About Yelp Inc.
Yelp Inc. (www.yelp.com) connects people with great local
businesses. With unmatched local business information, photos and
review content, Yelp provides a one-stop local platform for
consumers to discover, connect and transact with local businesses
of all sizes by making it easy to request a quote, join a waitlist,
and make a reservation, appointment or purchase. Yelp was founded
in San Francisco in July 2004. Since then, Yelp has taken root in
major metros in more than 30 countries.
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version on businesswire.com: https://www.businesswire.com/news/home/20201022005382/en/
Yelp Inc. Julianne Rowe press@yelp.com
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