The Alley Effect

Yelp And The Decentralization Of Business

I had a really great meal today at a new restaurant called Denden Café Asiana in Providence. It's kind of out of the way – on a historical residential street that doesn't get a lot of drive-by traffic. It's not near any stores. It's kind of hidden away. I found out about it because it had amazing reviews on Yelp. I got a parking spot right out front. The food was amazing and it wasn't particularly expensive. I had a great meal in a nice little restaurant.

There's a quiet revolution going on that might be easy to miss. Our discovery and recommendations of the things around us is changing. No longer does a great restaurant need to be located on a major street with a lot of foot traffic in order to be successful. Thanks to tools such as Yelp and Google, a great restaurant located in an alley is now just as discoverable as a crappy chain restaurant on the main strip. In fact by lowering their overhead, these restaurants can focus on quality and customer experience without needing to charge outrageous prices.

Okay. This guy discovered Yelp. Big deal. Why should I care?

This trend isn't just affecting restaurants. It's affecting all types of business. There are now discovery and recommendation services for lawyers, doctors, contractors, and lawn service companies. It seems like every hair salon has a Facebook page. While there may still be a certain prestige to certain streets in any given city, it is becoming less and less of a necessity for any small business to depend on foot or car traffic for discovery and success.

Find a good space in a nice alley. Spend the money you saved on a nice website and a great quality product. I know this because I've been making a living from online discovery and word of mouth since 2006. Lullabot does not have an office on a major thoroughfare. Our team is entirely distributed. We don't actually have an office at all. Yet we're not difficult to find.

It certainly helps that we're a web-oriented design and development company and people kind of expect to find companies like ours on the web. But as more people get in the habit of using services like Yelp, FourSquare, Google, Facebook, and Angie's List to discover a wider variety of businesses, there will be less and less reason to be centrally located. There might not even be a reason for many businesses to have an office at all. It's certainly worked out that way for us.

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