Local.com Announces Traffic, Results

Last week Local.com put out a release about its growing traffic:

The company reached record search traffic of 63 million monthly unique visitors (MUVs) on the Local.com site and network during the second quarter of 2009, up 5% from 60 million MUVs during the first quarter of 2009, and up 32% from 48 million MUVs during the second quarter of 2008.

Organic traffic also reached an all-time high, exceeding 29 million monthly unique visitors on the Local.com site and network during the second quarter of 2009, up 6% from 27 million during the first quarter of 2009, and up 57% from 18 million during the second quarter of 2008.

And today the company released preliminary Q2 financials:

Local.com Corporation, a leading local search site and network, today announced that based on unaudited preliminary results for the three months ended June 30, 2009, the company expects revenue to be between $13.4 and $13.7 million, exceeding the high end of its prior guidance of $13.2 million.

My understanding is that roughly half the traffic is organic and half is paid. It’s not clear what percentage the network contributes.

Never Trust ‘The Cloud’?

First the Twitter docs controversy: A hacker sent hundreds of allegedly authentic internal Twitter docs to TechCrunch. There was much sensitive information in there. Some of it TechCrunch is going to expose, some of it the site has chosen not to.

Beyond the ethical questions surrounding TechCrunch’s potential disclosure of the docs, there is the issue of the security of the cloud. Apparently the docs were downloaded from Google Apps.

What it shows is that cloud security is not ready for prime time.

Fake Reviews Purveyor Settles Suit for $300K

Thanks to Mike Blumethal for pointing me to this story of a settlement between a plastic surgeon and the NY Attorney General for the posting of false positive reviews:

Attorney General Andrew M. Cuomo today announced a settlement with cosmetic surgery outfit Lifestyle Lift over the publishing of fake consumer reviews on the Internet.

Under the settlement, Lifestyle Lift will stop publishing anonymous positive reviews about the company to Internet message boards and other Web sites, and will pay $300,000 in penalties and costs to the State of New York. The case is believed to be the first in the nation aimed at combating “astroturfing,” a growing problem on the Internet.

Lifestyle Lift employees published positive reviews and comments about the company to trick Web-browsing consumers into believing that satisfied customers were posting their own stories. These tactics constitute deceptive commercial practices, false advertising, and fraudulent and illegal conduct under New York and federal consumer protection law. The settlement marks a strike against the growing practice of “astroturfing,” in which employees pose as independent consumers to post positive reviews and commentary to Web sites and Internet message boards about their own company.

A few thoughts:

• This practice and case illustrate the high-stakes that now accompany online reviews
• Automated policing mechanisms will need to develop to combat it
• Selected sites will become more trusted (and trade on the authenticity of their reviews) if this practice becomes more widespread
• This settlement will hopefully “chill” astroturfing

____

Related: Andrew Shotland weighs in on the issue with his own irreverent yet practical take.

Compensating Content Creators: What’s Fair?

A new Columbia Journalism Review opinion piece argues persuasively (in my view) that Google “owes” something to traditional journalism and news organizations. Google, typically, is a stand-in for “the internet” in these discussions. However the notion of “responsibility” to publishers is unpopular among bloggers and Internet denizens more generally.

I tend to fault news organizations for not being faster, smarter and more creative in their online efforts. It’s also the case that the Internet as a publishing and distribution platform has disrupted traditional media models across the board. And pointing the finger at others, such as Google, tends to obscure the fault or responsibility that publishers should accept for their own missteps, failures and omissions.

Having said all that, I found this discussion in the article pretty compelling:

On Saturday afternoon, February 7, 2009, SI.com, the Web site of Sports Illustrated, broke a huge story: Alex Rodriguez, the mega-rich Yankees star, had taken performance-enhancing drugs while playing for the Texas Rangers. Sports Illustrated released the story on its Web site rather than in the magazine, according to the editors involved, in an effort to enhance SI.com’s standing as a destination for fans increasingly conditioned to getting sports news online. Within hours the story was everywhere, but if you went through Google to find it, what you likely got instead were the pickups that appeared elsewhere, summaries or even rewrites, with attribution. Most galling was that The Huffington Post’s use of an Associated Press version of SI’s report was initially tops on Google, which meant that it, and not SI.com, tended to be the place readers clicking through to get the gist of the breaking scandal would land.

The rest of this post is at SEL.

Borrell: 20% of Social Nets Ad Dollars Local

While I was gone Borrell put out an ad spending projection that contends social networks will see 20% of their ad dollars come from the local (read: SMB) market:

We just did an assessment of advertising placed on social networking sites and were surprised to find that nearly 20% of all ad spending is by local businesses. Our assumption going into this research was that commercials on social networks were almost purely national. We’re estimating that local advertisers will account for about $641 million of nearly $3.3 billion this year trying to reach consumers via these sites.

Borrell’s list of social networking sites is long but there are only three sites that matter in the big picture: Facebook, Twitter (no ads now) and MySpace (although MySpace is fading). Maybe AOL will do something with Bebo and local that is interesting in the future, given that AOL is making a renewed effort in local. There may be other isolated sites that matter here and there for specific industries or verticals.

Problems/issues/questions with this estimate:

• It’s extrapolated from a small base
• Most of the “action” on social networks among SMBs cannot be considered “advertising” (e.g., Facebook profiles, fan pages)
• What’s a “social network”? We all know the top sites but definitions get murky when one gets farther “down” the ladder.

I agree that there will continue to be lots of focus and energy among SMBs directed to social networking sites — Twitter and Facebook in particular. The challenge for these sites is how to build functionality that both benefits SMBs and can generate revenue. The various flavors of “advertising” on Facebook are not as useful as the free tools. And Twitter effectively has no ads.

There is, however, a substantial opportunity for third parties, SEM firms and directory publishers in particular to add Twitter and Facebook tools (and reach) into their product set to add value to what they’re providing to advertisers. Some are contemplating or already doing versions of this. Agendize, for example, does extends directory publisher reach with its toolset.

Source Borrell Associates (n=118)

____

Related: From MediaPost . . . Most of the 2008 revenue forecasts proved to be terribly wrong:

A survey of eight revenue forecasts issued between June 2007 and December 2008 (from Veronis Suhler Stevenson, Jupiter Research, the Kelsey Group, Lehman Bros., Magna, eMarketer, J.P. Morgan, and ZenithOptimedia) reveals that, on average, the crystal ball for Internet advertising revenue growth in 2008 was about 100% higher than the actual growth rate, with an average prediction of 20% versus actual growth of just 10%, according to the Interactive Advertising Bureau. Midway through 2009, it seems likely the forecasts will be even further off. On average the analysts predicted 17.5% growth in Internet revenues, but the first quarter actually saw negative growth with a -5% drop. True, the rest of the year could see a recovery – but to yield an annual growth rate of 17.5% Internet revenues would have to grow an average 25% in the second, third, and fourth quarters.

Local Search Summit Delayed

I was informed this past Thursday that the Local Search Summit would be delayed until the time of SES San Jose (I believe Thursday of that week). More information later as I get it.

Taking a Few Days Off

I’m going to “get outta Dodge” (as some would say) for a few days to avert what might otherwise turn into a psychotic break with reality. I’ve always liked that phrase.

No blogging for me here until sometime Tues.

Oodle Integrates Twitter Distribution (and Search)

Oodle has integrated Twitter distribution into its network. According to the Oodle Blog:

Now you can post your listing on Oodle and automatically share it with friends on Twitter (as well as your friends on Facebook and MySpace). Listings are tweeted into your Twitter stream where your followers see it immediately.

Users can also follow or search for Oodle listings on Twitter.

I spoke with Oodle CEO Craig Donato yesterday briefly. He told me the Facebook integration was going well and that traffic was growing. He said Oodle’s social media integrations, including Twitter, are about trying to “enable conversations” around listings. Donato means lots of things by that, including sharing, investigation of listings and those associated with them, among other things.

Oodle has built a pretty massive network of publishers and “powered by” sites including Wal-Mart, Facebook, MySpace, AOL and many others.

Others are using Twitter as a distribution vehicle or traffic driver as well, including MerchantCircle (for coupons and deals), Scoot in the UK and a range of others. Soon it will be mandatory to have some kind of “Twitter strategy.”

___

But wait there’s more: Oodle’s success will likely not hurt Craigslist. I characterized the Oodle-Facebook integration as the first bona fide Craigslist challenger. But CL is the 18th most popular site on the US Internet with somewhere around 40 million uniques. It now appears to be the “Google of classifieds” in the sense that its market position seems unassailable.

MobileBeat Is Next Week

The MobileBeat 2009 conference is next Thursday (7/16) in San Francisco at the Parc 55 Hotel. It’s 12 hours of mobile goodness. But you say mobile doesn’t apply to you?

At a time when 1 out of every 7 minutes spent with media is already on a mobile device, everyone has to take mobile seriously as a platform.

It’s going to be a terrific event with a great lineup of speakers. They include folks from Google, Palm, Yahoo Mobile, Motorola, Nokia, and Microsoft. There’s also a startup competition at the end of the event, which should be pretty interesting. In the Lo-Mo segment, I just spoke to startup Aloqa this morning. They’ll be there. The complete agenda is here.

For a discount you can sign up here and enter the code “mb09opusre.” It’s equal to the early-bird rate ($450).

Google Hosting SF ‘Celebration’ for SMBs

Matt McGee posts at SEL about an event Google organized for SMBs in San Francisco to introduce them to the local business center and AdWords.  I’m guessing it’s a trial for other, similar events around the country. It’s being held next week, on July 15.

The copy for the announcement reads:

Google will host San Francisco business owners at City Hall for an afternoon of celebration and educational opportunity . . .

Google employees will be on hand to help you learn how to make the most of Google’s free business solutions and AdWords online advertising program, and we’ll distribute coupons for free AdWords advertising.

Google has tried many such SMB instructional events, from Google U (back in 2002) to ongoing “success seminars” (AdWords training sessions) still going on at various locations. These, and other efforts, such as the Google Online Marketing Challenge, are part of Google’s outreach to the SMB market.

Matt then goes on in the rest of his post to discuss complaints from existing SMB customers and advertisers about Google’s uneven customer service. His headline is Google Pitches New Small Business Customers, Ignores Existing Ones.

Online Reviews Trusted Most After WOM

According to a global Nielsen survey (25K online users in 50 countries), people trust their friends and then user-generated reviews and consumer opinions. Here’s the hierarchy of trust:

Very strangely “brand websites” comes in third before newspaper editorial content.

‘Look and Feel’ Makes a Comeback

RH Donnelley and Innovectra announced a deal for Dexpages, a searchable, clickable “look and feel” online version of the print directory. It can be downloaded or browsed online:

Each directory maintains the look of a print directory on a computer screen, and contains all of the information found in print versions, including local business and white pages listings, community information, and more. In addition, Dex Pages enables keyword search and displays hotlinks to email and website addresses, making it easy for consumers to contact businesses directly or discover more information on the business with a single click.

Currently available in the 14 states where R.H. Donnelley publishes directories for Qwest, Dex Pages will expand by the end of the year to include areas featuring the EMBARQ(R) Yellow Pages brought to you by Dex and AT&T Real Yellow Pages published by Dex. Once this is complete all directories published by R.H. Donnelley will be available on Dex Pages. Each virtual directory will be hosted by Innovectra using its ActivDirectory software.

Other publishers such as Idearc are doing this too. Look and feel lost out to search (search style presentation) in the early part of this decade but is now apparently making a comeback. Appealing to a segment of the audience that has moved online but still likes the familiar print layout and display ads. So publishers have “diversified” with print, online print look and feel, IYP/search, mobile apps/Web as sources of traffic for their advertisers.

What do you think about look and feel. Like it? Hate it?

Google OS Makes Sense, Creates Problems

Google Apps, Google browser, Android . . . Chrome OS. As most of you know by now, Google announced a full-blown operating system for netbooks and PCs:

Google Chrome OS is an open source, lightweight operating system that will initially be targeted at netbooks. Later this year we will open-source its code, and netbooks running Google Chrome OS will be available for consumers in the second half of 2010. Because we’re already talking to partners about the project, and we’ll soon be working with the open source community, we wanted to share our vision now so everyone understands what we are trying to achieve . . .

Google Chrome OS is a new project, separate from Android. Android was designed from the beginning to work across a variety of devices from phones to set-top boxes to netbooks. Google Chrome OS is being created for people who spend most of their time on the web, and is being designed to power computers ranging from small netbooks to full-size desktop systems. While there are areas where Google Chrome OS and Android overlap, we believe choice will drive innovation for the benefit of everyone, including Google.

Quick thoughts:

• Until people see and evaluate the OS no real assessments can be made of its prospects but Android suggests it will be solid and viable
• Accordingly this potentially gives MSFT a real run for its money (literally) in the netbook segment — the only healthy segment of the PC market. Could also eventually go “upstream” and challenge on laptops/PCs but that’s farther off and much more speculative.
• Google now is almost a complete alternative to MSFT (OS, apps, mobile, browser)
• Open source code (like Android) means that netbook OEMs will probably use Chrome to boost margins (if only a very little)
• The move is logical because Chrome (the browser) was a kind of OS or platform for developers and apps development. Android is an OS but perhaps not technically “robust” enough for netbooks and certainly not full PCs
• Chrome the OS will be deeply integrated with the browser experience and try to create a more seamless online-PC experience. Google made much of HTML 5 in the browser and what it could do — not quite enough it would seem, however.
• Apple and Google are now true competitors across a broader range of fronts. Google is very much like Microsoft now in many respects. It’s only a matter of time before Google CEO Eric Schmidt will be compelled by investors or regulators to depart the Apple board (the DOJ is looking into the two common Apple, Google directors)
• Even though there’s nothing explicitly anti-competitive here — in fact it makes the OS market more competitive — Google makes its position potentially more difficult with regulators simply because the company spans several key market segments and is using their integration to maintain leadership (though not illegally) in search online and extend it to mobile

You can read the scores of posts on Techmeme.

____

Agree with Henry Blodget’s remark about Chrome:

If Google wants to succeed in its boldest product launch to date, the Chrome OS, the company needs to focus on its success with the same intensity it once dedicated to search.

If it doesn’t, Chrome OS will end up just like Chrome: yet another irrelevant skunkworks project used by a handful of digerati and Microsoft-haters and ignored by everyone else.

Not sure that the criticism of Chrome the browser is fair yet. But Google’s “if we build it they will come” attitude more often than not has lead to products falling short of their potential. But Android success suggests that if Chrome the OS is good OEMs will use it.

Google Offers B2C Directions Widget

Google has announced a widget that easily integrates driving directions on websites:

This simple gadget allows webmasters to add customized Google Maps directions to their business locations. With the directions gadget, you no longer need to type and update multiple sets of text directions. Let’s face it: customers are only looking for directions from their specific location.

The gadget allows you to pre-fill the “To” field with one or multiple addresses. Customers are then able to print their directions with a single click. And if they would prefer not to drive, the gadget also provides walking and public transit directions.

Here’s Stanford University’s integration:

In the B2B store locator world, Where2GetIt, MapQuest and Microsoft (Virtual Earth) are the significant competitors. This is Google’s entry, which should prove popular.

Bing vs. Google Round 5

From Citigroup’s Mark Mahaney this morning:

We Conducted Our Own Proprietary Study of Comparative Search Results – We three-screen tested 200 of the most popular current Search queries using Google, Yahoo!, and Bing.

1. We found Google with either the most relevant results or tied for top relevancy 71% (142 Searches) of the time.
2. We found Bing with either the most relevant results or tied for top relevancy 46% (92 Searches) of the time.
3. And we found Yahoo! with either the most relevant results or tied for top relevancy 30% (59 Searches) of the time.

(emphasis added)

We view our study as generally validating the positive Bing reviews . . . but also demonstrating Google’s very strong position.

In Terms Of Stock Takeaways… – We find these datapoints incrementally positive for MSFT, incrementally negative for YHOO (although strategic options provide a bit of a hedge here and Street estimates appear to already assume Search market share erosion for YHOO), and generally neutral for GOOG.

In my initial discussion of Bing and Google on SEL the day Bing launched I said:

Some may look at the screens above and shrug. Indeed, some people have argued to me that Bing “has to be at least 50 percent better” than Google to start peeling away users loyal to Google (or Yahoo). Bing isn’t 50 percent better than Google. However, Bing does offer results that are, across the searches I conducted, highly competitive with Google and in some cases it offers features that are more user-friendly.

Given the strength of Google’s brand and its “ownership” of search Bing may struggle to make market share gains. However I predict that it will gain share. Those potential gains may come not at Google’s expense but rather from Ask, AOL or even Yahoo.

Consolidation in the Place-Based Media Segment

Digital out of home has been a growing media segment. It’s interesting to me also because it’s “place-based,” meaning the screens where you see the media and advertising are in particular locations, although in most instances the ads and content are only nominally local. Yesterday two of the more visible players in the category, Danoo and IdeaCast, announced they were combining:

Danoo, a leading digital location-based media network with interactive video screens in popular retail locations, has acquired IdeaCast, the leading provider of advertising in the rapidly expanding captive television category. This combination creates one of the largest and most advanced media platforms in the location-based media space. As part of the transaction, National CineMedia, LLC (NCM), operator of the largest digital cinema network in North America for cinema advertising, alternative entertainment and events, and Kleiner Perkins Caufield & Byers (KPCB), a leading venture capital firm with a rich history of building entrepreneurial investments into successful enterprises, will each hold a minority interest in the new company. The assets acquired by Danoo had been previously acquired by NCM from the original IdeaCast entity. The new Danoo corporate entity will continue to operate and sell advertising across its digital media networks under the Danoo and IdeaCast brands.

Danoo and IdeaCast have exclusive contracts to present content and advertising in thousands of high traffic and extended dwell time venues, including top-tier health clubs, airport newsstands, seatback TVs on JetBlue, Frontier and Continental Airlines, and a dense concentration of coffeehouses, upscale delis and cafes in the top U.S. media markets. The arrangement unites the best location-based media opportunities with leading technology, such as transparent ad insertion, IP-based geo-targeting, mobile interactivity, digital content distribution and dynamic content localization. The new entity provides advertisers and marketers an unprecedented platform to reach the elusive upscale mobile professional underserved by traditional media such as television.

This combination will give the new company much more leverage and clout with advertisers, as well as reach with consumers (it’s all about reach). Existing local sales channels haven’t really tapped into Digital OOH as a distribution medium to date. RippleTV offered (I don’t know if it still does) a unique self-service ad capability.

One of the more recent developments in the space, Danoo (in its earlier incarnation) added mobile marketing as an extension of what it was doing. This mobile-traditional media (although Digital OOH isn’t really traditional) combination is going to be more and more prevalent.

Google ‘Real Estate’ Not New

There was a great deal of coverage yesterday about Google adding new capabilities to enable users to search for properties on Google Maps. Matt McGee wrote it up on SEL and Om Malik offers something of a cautionary note on GigaOM.

This was triggered by the launch of real-estate search on Maps in Australia. While the capability may be new in OZ, real-estate search on Google Maps (or Google.com itself) and the use of Google Base to upload listings have been around for at least a couple of years — at least. See, for example:

• Google Promoting Real Estate Search, Base
• Google Adds RE Search Option to Maps

Matt correctly points out: “What you’re seeing is an updated and more comprehensive version of the real estate listings that Google Maps has shown before, along with a new search tool.” Google’s LatLong Blog explains:

Previously, you had to specify “real estate” from the search options menu, but now we’re making it easier to find available listings

You’ll notice that we’ve made some other enhancements that will improve your real estate searching experience. We’ve added lots of markers that will show not only the ten most relevant listings with pins on the map, but also show a small circle on every other listing in that area using the search results layer, so you can get a really good idea of the distribution of properties for sale. You can click on each marker and each small circle to get more detailed information about the property.

This feature means you can now conduct a real estate search around a specific neighborhood, or see at a glance all the properties close to a BART stop. You can also pan the map to another area entirely to see listings there if you decide that another part of town is more your speed.

This is a set of refinements of existing capabilities that have been present for at least two years. Nobody should be surprised or not expect Google to try and refine its user experience. (Street View has always been a great real estate search tool and is incorporated into Trulia for that reason.)

Just as with behavior in the Travel category, people are going to rely on more than a single site for information about real estate. Google’s refinements and improvements may help move it up the list and improve its “curb appeal,” but it’s not going to dominate online real estate. And Google is never going to devote the attention to a single vertical that a dedicated site like Trulia or Zillow would. With a couple of possible exceptions Google always looks for scalable “horizontal-vertical” approaches.

Here’s Hitwise data on the traffic hierarchy in the real estate category:

The Local Copy Made Me Click

I was reading a story on Yahoo! about the “Codex Sinaiticus,” the oldest version of the Christian Bible and how that’s being brought online. At the top of the page was a geo-targeted display ad for the Alameda County Fair. I live in Alameda County and was probably targeted by IP address in this case.

I was otherwise unaware that it was going on and wasn’t looking for things to do. In other words I very definitely wasn’t in “search mode.” This was pure awareness building.

However the fact that this was a local event by itself made me click on the ad. On the site there are a bunch of social media (Facebook, Twitter, YouTube) tools that they’re using to promote the event and build email lists. And while I won’t follow the fair on Twitter, if I were somebody else (who didn’t cover this stuff for a living) I might.

Beyond the interesting fact that the county fair is using all the requisite online social tools to promote itself, the initial display ad was effective in getting me to the site.

The Online Publishers’ Association recently produced research that shows the value of display advertising for brands and other awareness marketers is not in the click but in subsequent user behavior. However the purely local nature of this ad caught my eye and got me to take action.

While there has been considerable use of (IP-based) geotargeting in online display, the fact that this had locally relevant ad copy and messaging was a critical piece of this ad in capturing my attention. Geotargeting without local messaging is not going to be as effective.

PR, Coverage and Unintended PR

This is pretty interesting: Spinning the Web: P.R. in Silicon Valley from the NY Times. Its focus is on the PR strategy surrounding a startup Wordnik and the people and investors behind that PR strategy. As an aside it’s also partly a story about the collapse of the prestige hierarchy of traditional media and publishers:

This is the new world of promoting start-ups in Silicon Valley, where the lines between journalists and everyone else are blurring and the number of followers a pundit has on Twitter is sometimes viewed as more important than old metrics like the circulation of a newspaper.

Gone are the days when snaring attention for start-ups in the Valley meant mentions in print and on television, or even spotlights on technology Web sites and blogs. Now P.R. gurus court influential voices on the social Web to endorse new companies, Web sites or gadgets — a transformation that analysts and practitioners say is likely to permanently change the role of P.R. in the business world, and particularly in Silicon Valley.

In this particular case widely read tech blogs were snubbed by the launch too, including TechCrunch. And Michael Arrington responds:

Forget the tech blogs, said investor Roger McNamee. Brew PR head Brooke Hammerling instantly acquiesced, and decided to go with a sort of guerrilla approach instead by “whispering” into the ears of prominent Twitter users like Kevin Rose, Jay Adelson and Jason Calacanis. CNET was also given the story, but it managed to eek out only a single comment . . .

The result? Not much. Wordnik is flatlining at an abysmal amount of traffic. Comscore and Quantcast don’t even register the site as a blip.

Compare Wordnik to Topsy, another recently launch service. Topsy launched on TechCrunch exclusively. The domain now has 577,000 results on Google, compared to 56,000 for Wordnik. And the traffic difference is stunning . . .

Most people, including people in the tech industry, haven’t heard of Wordnik. As Arrington suggests, the original PR strategy failed.

But the irony is that this (traditional media) NY Times article and the related, secondary coverage it gains (e.g., TechCruch) about the PR strategy behind Wordnik will do more for Wordnik’s exposure than the original launch PR described in the article.

Time to rethink assumptions again?

Collapse of the US Newspaper Industry

Business Insider captures the decline in 2009 (and before), citing statics that approach shocking:

• 105 newspapers have been shuttered.
• 10,000 newspaper jobs have been lost.
• Print ad sales fell 30% in Q1 ‘09.
• 23 of the top 25 newspapers reported circulation declines between 7% and 20%.