Dive Brief:

• Yelp reported sales of $235 million in second-quarter earnings reported Thursday, a figure higher than Wall Street analysts' $232 million projections, according to CNBC. The company attributed the better-than-expected outlook to its strong advertising business. 
• The company's ad revenue increased 21% in Q2 to $226 million. Paying advertising accounts rose by 17,000 to 194,000, outpacing industry forecasts that pegged growth at 8,000 new accounts, according to The Wall Street Journal.
• Yelp also reported that the number of active devices using its app grew 15% year-over-year to more than 32 million. 

Dive Insight:

Yelp's growing ad sales demonstrate how marketers are potentially starting to look beyond the digital advertising duopoly of Google and Facebook. Because it is a leading destination for consumers looking for information about restaurants, bars, hotels and home services, Yelp provides a way for marketers to reach consumers who are already engaged and looking for specific goods and services.

Yelp was able to grow its sales business by increasing the size of its sales force and eliminating a requirement for marketers to commit to a fixed time period for their ad spend, the Journal said. The company began testing the "nonterm contract model" a couple of years ago to assess its impact on ad buying on the platform. Analysts expect the model to attract new advertisers who may be more interested in smaller buys or shorter campaigns. 

Strong ad revenue performance also signals that some of Yelp's newer marketing innovations are paying off. Earlier this year, the company launched Collections, a tool that uses machine learning, computerized sorting and consumer-created curation to provide personalized recommendations for restaurants, hotels and other local services. Offering tailored recommendations will likely lead to further growth for the platform, as consumers demonstrate loyalty to brands that listen and respond to their individual needs. 

Yelp's growth can also be attributed to consumers' increasing reliance on customer reviews to inform their purchasing decisions. A Merkle and Levo study released in March found that 84% of millennial women say their purchases are influenced by comments, customer ratings and reviews. Additionally, consumers are often more trusting of online reviews than personal recommendations from friends and family.