10-18 Do you think Zagat’s decision to use a pay wall for its Web site was a mistake? Why or why not? Founded by Tim and Nina Zagat, the Zagat Survey has collected and published ratings of restaurants by diners since 1979. Zagat publishes surveys for restaurants, hotels, and nightlife in 70 major cities. Zagat has come a long way from its roots in the early 1980s, when the foodloving Zagats started compiling lists of their favorite restaurants for personal use and to share with their closest friends. But with the rise of the Internet, e-commerce, and mobile technology, Zagat has struggled to find a business model that stayed true to the company’s origins.

To generate their first survey, the Zagats polled 200 people, and increased that number over time.

Executives, tourists, and New York foodies alike found the list to be indispensable. Spurred by this success, the Zagats decided to publish their survey themselves. The few booksellers that took a risk in stocking the book were rewarded with sales so robust that the Zagat Surveys became best sellers.

The pair also published similar lists for other major cities, including Chicago, San Francisco, and Washington, D.C. In addition to print books, Zagat opened a unit that creates custom guides for corporate clients, like the ones at Citibank. For a long time, this business model was sufficient to ensure that Zagat Survey was successful and profitable.