Yelp's new data tells us about the reopening — but it’s really a window into the digital economy

Wednesday, June 16, 2021 by Robinhood Snacks | Disclosures

Fewer scented candles... more candlelit dinners. Retail sales fell 1.3% last month, but it's not a bad sign for recovery. Spending is shifting from physical goods to "revenge experiences," as Americans swap TV menus for cocktail menus:

  • Down: Spending on furniture, electronics, and appliances fell — because we've already spent enough on our biodomes.
  • Up: Restaurant spending jumped 1.8%, and clothing sales jumped 3% (for all those date night fits). But restaurants are still struggling to fill job openings (#LaborShortage).

Hold my beer garden... Yelp's latest data blows those retail numbers out of the iced tap water. Last month, Yelp seated a record 3.7M diners in the US — up 48% from May 2019. Yelp bookings surged past pre-pandemic levels in almost every US state, minus NY.

  • In Texas and Florida, where Covid restrictions have been lifted longer, Yelp diners more than doubled last month compared to two years earlier.
  • In California, which lifted its mask mandate and restrictions yesterday, diners were already back to pre-Covid levels in May.
  • It could be that restaurants added more pandemic seating areas (hence: extra booking space). But we think something else is going on...

Yelp’s data confirms the digital transformation... The 2019 numbers and the 2021 numbers are apples and digital oranges. What these comparisons really reflect: the number of restaurants and diners that moved online. During the pandemic, restaurant owners flocked to tech platforms to secure takeout orders, set up digital menus, and add contactless payments. And it appears they're staying digital. This shift bodes well for restaurant tech providers like Yelp, OpenTable, Toast, Square, and Resy.