Why Yelp Stock Crushed it on Tuesday
Key Points
As part of this, it rolled out a new service called Yelp Assistant.
This AI chatbot can help users not only find suitable businesses but also book products and services directly.
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On the back of an update to its product lineup, Yelp (NYSE: YELP) stock did well on Tuesday. Investors pushed the shares up by more than 3% during an otherwise forgettable trading session that saw the S&P 500 index dip by 0.6%.
An intelligent move
Well before market open, Yelp announced its spring product release, a refreshing of the business listing specialist's suite of offerings.
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This release centers on a new offering, Yelp Assistant, a chatbot underpinned by artificial intelligence (AI) that assists users in finding the goods and services they're looking for. It also assists in taking action, as it can book restaurant reservations, obtain quotes from service providers, reserve appointments, and the like.
According to Yelp, Assistant isn't just an expansion of its business. The company quoted chief product officer Craig Saldanha as saying that it "is our most significant AI product evolution yet as we reconceive Yelp around instant answers and seamless actions."
Yelp of the future
So, if the new offering is sufficiently attractive and appealing to Yelp's considerable user base, it could help boost the company's ambitions to move away from its present business model -- which remains heavily dependent on advertising. It's early days for this strategic shift, so for me, Yelp is a wait-and-see as to how effectively it can make that transition.
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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
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