Yelp Gears Up To Take On Groupon, Starts Testing Local Deals

It looks like Yelp is looking to cash in on the local deal craze. As the folks over at deal aggregator YipIt first noticed, Yelp has recently been testing time-limited local deals in a select number of pilot cities.

The proof lies in a comment thread that began June 23, when a Yelp user noticed a deal running for $20 for $45 of services at Papillon salon. The user wrote that you can purchase the deal through Yelp with your credit card. Yelp employee Olivia L. responded to say that Yelp was “testing it out for fun to see what kind of response it generates”.

The feature would obviously compete with Groupon and a throng of other deal sites, though it isn’t clear if Yelp is testing a group-buying mechanic or if it’s simply offering deals for a limited period of time. We’ve reached out to Yelp for more details (and to confirm that the tests are still running).  Given Yelp’s established audience this makes perfect sense for the company — I’d be surprised if they don’t deploy it more widely down the line.

Update: Yelp has sent this statement:

Yes we ran a short test in Sacramento. We’re always testing new things and if our users respond positively to deals from great businesses of course we’ll deliver that.

Marketing programs that connect consumers with great businesses and awesome deals, have worked well for us in the past. Over the last couple of years we’ve hosted a number of marketing programs all across the US. (see list below) Portland is running Yelp Drinks as we speak.

Yelp Eats (week-long promotion where we spotlight restaurants and work with them to offer special pre-fixe menu specials)
Yelp Drinks (promotion to highlights local bars with drink specials)
Hawt on Yelp (week long spa specials 50% off special services)

In other Yelp-related news, earlier today Google rolled out a new Places application for Android that will be directly competing with Yelp’s directory of local reviews.