Friday, September 9, 2011
Google buys restaurant review service Zagat
This "iconic" publisher of restaurant reviews is "trusted" and "well-loved" by foodies. Customers love its "ability to innovate" and gush over its "tremendous insight."
Google said Thursday that it is buying Zagat, maker of the slender guidebooks that offer one-paragraph reviews and numerical ratings of eateries, peppered with partial quotes from the people who love and hate them.
Google plans to integrate Zagat's online reviews into its Google Maps service and its basic search results. Google said Zagat's style, drawing on snippet-sized customer reviews, was mobile before mobile was cool.
"Zagat has established a trusted and well-loved brand the world over, operating in 13 categories and more than 100 cities," Google said. "The Zagats have demonstrated their ability to innovate and to do so with tremendous insight."
The founders, husband and wife team Nina and Tim Zagat, said they will remain co-chairs of the 32-year-old company and will use Google's resources and expertise to expand.
In a blog post Thursday announcing the purchase, Marissa Mayer, Google's vice president of local, maps and location services, said Zagat "will be a cornerstone of our local offering."
Google and other companies are trying to improve their local offerings as a way to sell more ads to local merchants.
BGC Partners analyst Colin Gillis said the purchase was smart. He said Zagat is like the little brother of Yelp, the leading online review site and a pioneer in a space that was founded in 2004. Google had attempted to buy Yelp in 2009, at one point offering about $500 million for the San Francisco-based company, according to numerous published reports.
Terms of the acquisition were not disclosed. It is likely a windfall for Zagat's founders, who tried to sell the company in 2008.
Google's stock rose 74 cents to close Thursday at $534.77.
The purchase may have rattled investors in OpenTable Inc., which provides ways to make reservations at restaurants along with diners' reviews. That company's stock fell $5.22, or 8.3 percent, to $57.51.