UCL School of Management is delighted to welcome Lan Luo, University of Southern California to host a research seminar discussing, ‘Can User Generated Content Predict Restaurant Survival? Deep Learning of Yelp Photos and Reviews’.
With widespread use of smartphones, approximately three billion photos are shared on the Internet daily. Nevertheless, very few papers have examined whether and how the prosperity of a business may be affected by consumer posted photos. We use deep learning methods to analyze 795,175 photos and 1,015,825 reviews of 17,796 restaurants that were posted on Yelp from Oct. 2004 to Dec. 2015. Tracking the survival of these restaurants during this time period, we find that both the volume and the valence of photos are strong predictors of restaurant survival. Nevertheless, when it comes to reviews, only the valence (not the volume) matters. Interestingly, even after controlling for content, star rating, and length of reviews, consumer sentiment extracted from the review text is still strongly associated with restaurant survival. We also find that chain and mainstream restaurants have a greater chance of survival than independent and niche restaurants. Ceteris paribus, price levels do not appear to impact restaurant survival. Our research is among the earliest attempts to introduce both photo and character-based deep learning in marketing. We are also the first to compare and contrast the managerial impact of consumer-posted photos versus reviews. To our knowledge, this is also the first large-scale empirical research on restaurant survival.