Google buys consumer review service Zagat

Faith Merino · September 8, 2011 · Short URL:

Google proves its commitment to rev up its social and local offerings

Google is showing the world that it’s not pulling any punches.  It’s clearly on a mission to reinvent several of its flagging businesses, and it’s pulling out the big guns.  Mere weeks after the company shelled out no less than $12.5 billion to acquire Motorola, it has now just announced that it is acquiring consumer review pioneer Zagat.

Google’s own Marissa Mayer (who is apparently now VP of local, maps, and location services) made the announcement via the Google blog, claiming that Zagat will be a “cornerstone of our local offering.”

The terms of the deal were not disclosed.

Founded in 1979 by Tim and Nina Zagat, the consumer review platform is best known for its physical guidebooks, which rate and review the hottest restaurants, shopping, nightlife, lodging, and more.  But Zagat has proven that it’s not stuck in the paper-age.  Earlier this year, the company revealed a revamped website with much more free content, easier search capabilities, lists, a compilation of the top-rated restaurants in a given area, and more.  

And to spiff up its mobile offerings, Zagat sealed partnerships with Foursquare and Foodspotting, and even released a mobile app of its own for iOS (with mixed reviews—due in part to the expense.  The app is $9.99).  Zagat also has apps for Android and BlackBerry.

As more user-generated consumer review sites like Yelp crop up on the Web, Zagat has to stay on its toes—especially considering the fact that so many of its competitors are offering free services.  Zagat previously charged users for access to its content, but its new website offers up some freebies.  For example, you can see a list of Zagat-rated restaurants and cafés, which will show you how many people liked the restaurant, but in order to unlock the ratings and reviews, you have to sign up for a premium membership, which costs $24.95 a year, or $4.95 a month.

Back in 2008, Zagat was rumored to be looking for a buyer.  Its business was valued at some $200 million.  But nothing came of the rumor.

Meanwhile, Google was in talks with Yelp over a $550 million acquisition offer, but the deal fell through and Yelp went on to raise $100 million in financing from Elevation Partners a month later.

“By combining their content, resources, and platforms, this dynamic duo plans to optimize the potential of the Zagat brand while offering new ways for consumers to express their opinions and make informed decisions,” Zagat said of the deal, of course, with more quotation marks.

“With Zagat, we gain a world-class team that has more experience in consumer based-surveys, recommendations and reviews than anyone else in the industry,” wrote Marissa Mayer.  “Their iconic pocket-sized guides with paragraphs summarizing and ‘snippeting’ sentiment were ‘mobile’ before ‘mobile’ involved electronics.”

Mayer says that Google will be collaborating with Zagat to bring Google Search and Google Maps to Zagat’s platform. 


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