Google & Zagat: Batman & Robin

Google just announced it is acquiring Zagat Survey (Zagat), a historic and significant player in the restaurant review space.  The purchase is another component of Google’s growing travel-related arsenal and also supports its focus-local efforts.  Zagat notes that its “commitment to accuracy and fairness” is consistent with Google’s and that together Zagat and Google will make a “dynamic duo.[1]”  Compete reviewed recent results for with context to inform what the deal might serve up.

[1] Both from comments on on September 9, 2011

How Big is the Kitchen?

Compete’s Restaurant & Dining behavioral category has shown steady growth over the past 12 months, approaching 40 million unique people per month in July 2011.  Behavioral categories represent the net number of unique people across a collection of related sites, with no double-counting of people that visited more than one site in the set in a given month (i.e., no false positives).  The growth across the period means more than just seasonal growth—volume was up 19% y-o-y.  Note that the category contains a wealth of sites, so at this aggregate level would not show, for example, any recession-driven shift from premium restaurants to mid-grade ones.

Zagat’s Slice of the Online Pie

Zagat’s stature is driven in part by its tenure: it was started in 1979.  That stature has amounted to an average of 385,000 unique visitors (UVs) per month over the past 13 months (“unique” meaning consumers that visited the site more than once in a given month counted only once in that month).  Results are based on domain-level travel, so do not represent Zagat content used elsewhere.

Zagat has missed the category’s growth, however, as UV volume has trended down over the period as has share of the category.  Its July share was 0.9% vs. period-high 1.5% in August 2010.  The year-over-year results suggest that results are not driven by seasonal patterns.  Results do not necessarily reflect the economy either as Zagat also offers insights on the full spectrum, including fast food restaurants (the most recent was released in September 2011).

Naturally domain traffic is only part of the story.  Zagat offers Premium Membership for $24.95 a year that includes additional information and access to discounts.  And of course Zagat also sells hardcopy information.

As data shown are through July 2011, they do not reflect August site enhancements, including a new compare feature, and a reservation process integrated with OpenTable.  (For context, OpenTable had 2 million UVs in July, about 5.5X  The small lift in March volume and the larger lift in May volume and share shown above may represent the impacts of February 2011 site enhancements.

Just Desserts

With its established brand and expansion of services and segments, Zagat in many ways has a competitive advantage.  And being part of the Google family will surely enhance exposure of content and available resources.  The success of the dynamic duo can be measured in several ways including:

  • Gains in share for relative to the category and to new rivals (and within the context of the category’s growth vs. OTA and travel supplier site growth)
  • An upward trend in the total number of UVs across the internet viewing Zagat’s content (which Compete quantifies by determining unique UVs across all specific URLs know to contain Zagat’s content)
  • Lifts in traffic from future site enhancements and links (starting with comparing the change in traffic associated with each of the major site revisions including August 2011—and related ad support for those)
  • Greater Zagat’s brand awareness (measured through surveys and presence of the Zagat’s name across leading search engines)
  • Greater use of Zagat’s content in the consumer research process (which is assessed using path-to-bookings studies)
  • Greater site content use (baselined by assessing use of the new content on the site over time vs. like content for rivals)
  • Increased presence of Zagat in other social media venues (for example, Zagat promoted its early 2011 “SmartBox” campaign on Facebook but generated few “likes”)


About Lincoln Merrihew:
Lincoln Merrihew is the Senior Vice President of Transportation at Millward Brown Digital. At Millward Brown Digital, Lincoln is responsible for steering the Transportation Team, which encompasses the automotive and travel practices. Before Lincoln joined the Millward Brown Digital team, he worked at TNS Custom leading the Automotive team, and then continued on there to lead business development for 10 different industry verticals. Lincoln's career aspiration is to create game-changing solutions and insights. Connect with Lincoln on LinkedIn.