EveryScape has introduced another city: Austin, Texas:
EveryScape makes money when businesses buy “interior” imagery. It’s a great site but the model makes making money from local businesses tough slogging.
Hotels and selected other businesses will recognize the importance of signing up for these images but most local businesses will need to be “sold” on the idea (and some won’t care).
Here are previous posts about EveryScape.
ValleyWag posted rumors about layoffs at SpotRunner and related financial trouble. PaidContent spoke to Spot Runner and apparently got the straight story:
Company spokesperson Rosabel Tao, VP of corporate communications, told me that the layoffs constitute about 10 percent of its employees, but at the same time, it is hiring another 40 employees in various positions, so will come out about the same as before. The reason? Tao says earlier this year, the company started to reorganize itself along three business lines. The company started as a TV ad seller using online, focused on small businesses, but has grown from there and added online/search, radio and other local sales channels to its portfolio.
SpotRunner has raised a total of more than $100 million from investors. The company also purchased Weblistic (to which I had served as an early advisor) in an effort to add search marketing.
I have followed this company since before launch and have been impressed by the foresight and polish of some of their efforts and the general “smarts” of the leadership. But I’ve also seen them fail to capitalize early enough on a few trends.
Spot Runner is more like Google or Yahoo in many respects than it is like a yellow pages publisher, with a SMB sales channel. Accordingly, it’s had some of the same channel struggles in reaching the SMB market that Google and Yahoo have. Other than reading these aforementioned posts it’s not clear to me whether the company is that interested in the market anymore (I’ve asked for a comment). For some time it has been also working with its large agency investors to localize national advertising.
Spot Runner has also diversified into a range of other media (from its original emphasis on cable TV). The comany was really the first to attempt to make video affordable for SMBs and built an impressive platform to manage distribution of that video on cable. However it now has more than a dozen competitors in the online video segment.
As Rafat Ali points out in his post (PaidContent) next year may bring more economic pain (let’s hope not) and that may test Spot Runner among scores of others. However, as something of a bulwark against that potential pain, Spot Runner has sizable revenues from what I understand.
Someone sent me a longish article from the Wall Street Journal that offers a “step-by-step” guide to creating a cheap or free website and then marketing it. It attempts to be comprehensive in its sweep but it’s too facile.
The article cites a Jupiter survey saying that 36% of US SMBs (<100 employees) have a site. An online survey Local Mobile Search did last year got a number closing in on 50%. The figures go up and down in almost direct correlation to company (headcount) size.
The article is interesting because it assumes — just as many Internet insiders assume — that by simply pointing out the steps and naming a few resources, the problem of developing a website and marketing it effectively will be solved.
The problem, however, is that there are too many choices and resources in the market. While there may be some ignorance of what the options are, most SMBs may be frozen by the fact of so many options. They’re too busy to do the research and need recommendations regarding which companies to use and trust based on performance and value.
Many sites are now starting to allow businesses to respond to reviews. This arguably offers “balance” and “fairness” for the businesses, but makes for a curious user experience. Note these reviews on TripAdvisor for a Northern California hotel:
Some site owners have argued to me that allowing this sort of “exchange” between customers and business owners degenerates into defensiveness and name calling. While the responses succeed to some degree in disqualifying or blunting the criticism from the customers, they also reflect poorly on the business itself.
Yelp has created a behind the scenes method for business owners to communicate with reviewers to avoid this. And Kudzu, which does allow comments, has created a business network that allows businesses to publicly endorse one another — thus providing another input for consumers.
There may be no single best approach but, given how important online reviews are becoming, it’s important for publishers and sites to continue to experiment with ways to be fair to business owners and allow them a “say” and to “participate in the conversation” but in ways that don’t diminish the overall user experience.
There’s a longish, general piece on SMB video ads online in the WSJ. It has some pricing data in it. The most interesting bit of the article is an anecdotal case from a Jivox customer:
In April, Mirek Boruta, co-owner of the Princess Port Bed and Breakfast, a family-owned B&B in Half Moon Bay, Calif., was looking for a way to attract customers because bookings were down for the typically popular summer season.
He was unimpressed with Internet banner ads and search-related listings, so he turned to Jivox, a Web-based video-ad service based in San Mateo, Calif. Jivox lets customers create commercials at no cost, but charges about $5 to $20 per 1,000 views of the video, depending on where the advertiser chooses to distribute the spot.
Mr. Boruta pinpointed users located in California, Nevada and Washington who were surfing local television and newspaper Web sites on Wednesday and Thursday nights, when he thought potential clients would be contemplating their weekend plans.
“Our Web traffic tripled instantly, from 10 hits a day to 30,” and soon “all of our rooms were booked solid,” Mr. Boruta says. The cost of running the ad for 40,000 views (measured as how many times a user watched the video through the end): $500.
Mr. Boruta says 85% of customers brought in the online coupon, so he knew the ad was working. “We’re a small bed and breakfast, so tripling the visits to our Web site and having to actually turn customers away is a big deal,” he says.
(my emphasis)
The coupon as a tracking tool is interesting, in terms of its uptake. And the pure effectiveness of the ad is also striking.
Part of its effectiveness is about novelty and the fact that not everyone has video ads (more than 90% of SMBs do not). That will change somewhat over time, as video advertising becomes more pervasive. Indeed, most static graphic ads online will be replaced by rich media and/or video.
Another interesting thing about video is that it can, to some degree, be a “replacement product” for YP publishers where the print ad spend is reduced in favor of online — notwithstanding the figures in the article excerpt above.
A version of this discussion has come up several times in posts and comments on this blog: What is a legitimate review? Miriam Ellis offers a thought provoking post in which she suggests that a site like Yelp might remove multiple positive reviews coming from a single computer or IP address as suspicious.
The scenario she paints is this: a business owner offers a “public” computer on premises or even free WiFi and enourages people to write reviews, directly or indirectly. But the review site, in this case Yelp, might see a bunch of positive reviews coming from a single IP address and regard them as illegitimate.
Clearly if I as a small business owner pretend to be another person and write a fake review lauding my own business or if I get friends and family who are not customers to do something similar that’s “verboten.”
But what about a situation in which I provide an incentive of some kind to write a review while in my shop/shore? How about a “free cup of coffee to anyone who writes a review on Yelp?” This type of incentive was being used — as in free Starbucks cards — by a number of the early review sites (InsiderPages, Tribe, etc.) to get people to write reviews.
In my hypothetical no one is being asked to write a “positive” review, just to write “a review.” Say my program is extremely successful and suddenly (the week I start it) 30 or 40 mostly positive reviews show up. How would Yelp or another, similar site respond? If the reviews are written on-site using free WiFi Miriam’s post suggests they might raise suspicion coming from the same IP address and be removed. But should they be removed because of the incentive alone or would they if they appeared en masse in a relatively compressed time frame?
Let’s put aside the IP address issue for a second. How would my incentive program be treated? In my example these are all real people. I as the business owner haven’t asked them to say anything in particular, especially anything positive. I might even go out of my way to say “tell us what you really think, good or bad.” Yelp does explicitly address this situation and doesn’t like it either way. It asks users to disclose incentives and discourages them from writing reviews in response to such a program:
What if the business I’m reviewing gave me something for free or at a discount?
You should never accept freebies or discounts in exchange for reviews. For example, if a bar owner offers you a free drink in exchange for a 5-star review, you should not accept his or her offer.
Of course it’s ok if you were given something for free or at a discount independent of your review, but you should always disclose any special treatment, gifts, or discounts in your reivew. For example, if the restaurant manager gave you free appetizers on opening night, you should include that information in your review. Yelping is about real, honest reviews, so while we’re happy you had an extra special experience, we ask you to tell us (your readers) the whole story.
I’m in the midst of another survey of small business advertiser attitudes. To the question (also asked last year), “What do you think of online reviews?” the top response so far is “online reviews are a good thing and are helping us improve our business.” That was the winner last year as well:
As you can see we’re in a gray area ethically and philosophically with some of this behavior. But the stakes are high for local businesses, as consumers increasingly look at reviews as part of their decision-making process. In a city like San Francisco, Yelp arguably has more influence than any other single site.
What is needed is additional clarity regarding what’s permissible and what’s not (e.g., “reviews coming from the same computer will potentially be disallowed”). Most businesses will be ethical — just like most people are ethical — but they’re trying to figure all this out. I certainly don’t blame them for being creative.
Here are the persistent questions from institutional fund managers about the future of yellow pages:
The third point is the subject of this post.
This ClickZ article about Localeze, SEO and a small business owner is a case-in-point. The guy was doing everything himself (online) and then decided later than he needed professional help and so is using Localeze to handle his SEO.
People frequently debate the issue of whether SMBs will set up online ad campaigns themselves. The conventional wisdom is no because this is a “push” rather than a “pull” market. The focus is almost entirely on the SMB new to online marketing. But there’s another opportunity with a segment that many publishers and others perhaps count as “lost”: the SMB who has been doing self-service advertising online and is losing ground or simply tired.
That person is an overlooked prospect in many cases for YP publishers and others who can take over the SEO/SEM work on their behalf. This more sophisticated SMB is a better prospect in some ways that the uninitiated mass precisely because of the experience they’ve had in trying to “do it themselves.”
MerchantCircle has introduced what it’s calling an “instant website” product. In order to take advantage of it local businesses need to be registered with MerchantCircle.
The company told me yesterday that 75% of its registered businesses/members (now at 550K) don’t have websites. This number is not the same as all SMBs because MerchantCircle “over-indexes” in smaller markets. (My survey research has shown a figure in the 55% to 60% range for no websites among SMBs.) But it represents a significant market opportunity for the company to grow its advertiser base (now at a reported 7,500).
The websites are similar to blogs in that their format is templated but can be changed at will. The content is drawn from the MerchantCircle profile pages. Richer pages equal better website content. The website populates with a single click at the end of the process.
To begin, local businesses register domains through MerchantCircle. Hosting and monthly fees are $14.99 per address per month. Costs go down for multiple addresses. Here’s a video showing the entire process, most of which is spent on registering domains.
Yahoo!, Microsoft, Google and SmallTown offer stand-alone simple website building tools. Blogs can also be used as sites (as I do). However the MerchantCircle tool may be the quickest and easiest yet. It represents an entry point for most of these businesses, which later will probably want more elaborate sites as they become more sophisticated. (That implies another product for MerchantCircle to meet that potential demand.)
However it’s a smart way for MerchantCircle to generate additional revenue and create a foot-in-the-door for an advertising upsell, as well as to provide a service to these businesses. Those that create websites are going to be more likely to advertise. It also creates SMB loyalty because most people don’t know how to transfer domains and will likely remain with MerchantCircle, accordingly, as their web host.
A related, previous post, “The End of SMB Websites,” generated lots of discussion and debate about the relationship between websites and landing pages, as well as the need for websites in a world of rich profiles and landing pages.
Yelp is now in the national spotlight. Most of the publicity the site has received to date has been positive. However, a local CBS affiliate did a critical piece on the site and its policies toward advertisers. (Urban Mapping called it to my attention.)
The controversy at the heart of the report concerns representations or promises allegedly being made to potential advertisers regarding treatment of negative reviews (that they would be de-emphasized or pushed down). Yelp denied that they agree to do anything like this. Citysearch has been accused of similar things in the past.
The link above shows the full segment on the news, together with interviews of the business owners who contend that they were wronged.
There’s also the parallel issue of removing positive reviews that were allegedly written by business owners or their friends. (This is a gray area: what if my relative or friend is really also a customer?) Yelp previously shut down trading of positive reviews among business owners.
All this reflects that the stakes are very high for local businesses and they’re trying to do something to influence how they’re perceived and represented online. There are also numerous challenges that Yelp now faces in holding such a powerful position in certain markets.
One of the interesting things that restaurant reviews aggregator BooRah is doing is enabling communication between restaurants and customers through its loyalty program, which I previously blogged about. As part of that program, businesses may collect comments from customers (favorable or critical) and may selectively publish them. BooRah then syndicates those comments to its partners. In this way local restaurants can publish positive reviews and choose not to publish negative remarks.
While there are several “reputation monitoring” programs in the works, this is the first such program that actually generates positive reviews or gives businesses this level of control. To be clear, these are comments that diners are making to business owners not reviews being written publicly on the BooRah site (as I understand the program). The business then has control over whether to make the comments public. It’s thus different than “de-publishing” a negative review.
Previous online research conducted by Opus Research (owner of Local Mobile Search) and AllBusiness.com last year we found that most SMB respondents had a favorable view toward online reviews. But this is a complex area that is still evolving.
The Kudzu program I blogged about this morning is another effort to give businesses more control or influence with consumers.
Cox’s Kudzu has introduced “business networking” on the site. This becomes another source of references/referrals for consumers and allows businesses to more directly “participate in the conversation” going on between consumers using Kudzu.
Kudzu was the first site to allow local businesses to respond to reviews. However, this is a more interesting and powerful tool for them and for consumers.
Many people “in the real world” ask trusted local vendors or contractors whom they would recommend to perform this or that job or service. It’s another source of “word of mouth” in addition to friends and family referrals. This is what Kudzu is trying to capture and duplicate online. If I trust business X I should be able to trust another business that business X has endorsed.
Conceptually it’s similar to LinkedIn endorsements. MerchantCircle offers a much more limited version of this through reciprocal linking among businesses.
Kudzu is trying to make it clear that by including businesses on the list they are being endorsed and so, hopefully, businesses will be careful and selective rather than simply linking to one another.
A version of this emerged organically on Yelp, with businesses trading favorable reviews. But that was shut down by Yelp as gaming. The Yelp example indicates that a program like the one Kudzu is introducing would potentially be more widely in demand.
Hopefully I didn’t blow the embargo, but last week I wrote about Zvents’ integration into MSN Cityguides. Today the relationship was formally announced:
Microsoft selected Zvents to power the Events, Venues and Performers platforms for MSN City Guides, because the Zvents Media Platform infuses MSN City Guides with new character and capabilities for identifying and delivering information about local things to do. Zvents partners with hundreds of media channels to distinguish the local search experience with verve and detail what’s currently happening in any locale. The broad scope of the Zvents Media Platform is enriched with highly targeted advertising that relates specifically to an individual’s search for things to do. Local advertisers can deliver specific information to audiences looking for promotions, event, and business listings that relate to unique interests and searches.
I’m not sure whether this is smart or its opposite. According to this release, Citysearch is giving away online video (produced by TurnHere) to new advertisers through the end of August.
This will probably work to get attention and generate some new advertiser accounts. The release doesn’t discuss a minimum ad spend, which is what was previously required to get a video ad on Citysearch. So this may be a clever retooling of that proposition.
I wonder, however, whether it’s a reaction to a bad economy.
The WSJ is covering the recent Borrell report with a newspaper slant:
Over the past two years, the number of local salespeople peddling online ads for newspapers has ballooned to 15,500 from 5,900, according to estimates from media-research firm Borrell Associates. Traditional media companies have believed strongly that they have an edge over Internet companies because they are based in the communities they serve.
But whatever edge may have existed appears to have evaporated. Newspapers now control only 27.4% of the local online ad market, down from a 35.9% share in 2006, according to Borrell.
There are several reasons why newspapers so far have failed to crack this market. Because online ads are far less expensive than print ads and thus offer lower commissions, it’s difficult to get salespeople to focus on selling the digital products.
The piece discusses increasing competition from all sides and how newspapers are losing print revenues to more nimble competitors who aren’t protecting traditional revenue streams (except YP). The overall report isn’t quite as dire for YP, notwithstanding the sensational title “end of yellow pages.”
There’s a great deal more to discuss here but I’m out the door to the airport.
___
Backfence co-founder Mark Potts has some reflections on the local online ad sales issue and newspapers.
On the “local-mobile search landscape” panel at SMX Local-Mobile, Palore’s Hanan Lifshitz presented the following slide:
Source: Palore, July 2008
The information was drawn from Palore’s crawling methodology across various directories and local sites.
Compare the data above with the estimates provided to me last year by 25 local search executives when I asked them the same question:
Source: SMI, November 2007, n=25
I provided too broad a dollar range it now appears. Note also the number found to be buying PPC advertising according to Palore (I’m less clear on the methodology for determining that number).
Assuming the accuracy of the Palore figures, it means there are lots of SMBs probably spending in the $600 to $1200 per year range. If categories like doctors and lawyers had been included the numbers might have been slightly larger.
ReachLocal has hired a CFO and general counsel:
ReachLocal, Inc. ReachLocal Inc., a leading provider of local Internet marketing solutions for small- to medium-sized businesses, announced today that it has built out its management team with the hiring of Ross Landsbaum as Chief Financial Officer and Adam Wergeles as General Counsel.
Landsbaum joins ReachLocal with more than 20 years of experience in finance and operations at both multi-location customer service-oriented businesses and diversified media companies. Most recently, he was at MacAndrews & Forbes’ Panavision, a leading service provider to the global motion picture and television industries, where he was Chief Financial Officer and, subsequently, Chief Operating Officer. . .
Hiring a CFO is suggestive of an aim at the public markets.
The word “local” appears to be a problem.
It has turned out to be somewhat confusing to many advertisers and has obscured rather than elucidated the opportunity. The opportunity is to lead shoppers and searchers to an offline point of sale or vendor for fulfillment of their need. That opportunity extends to businesses large and small, to national brands and independent local stores.
Online influencing offline sales.
But national brands and marketers often don’t see the opportunity because they associate the word “local” with someone or something other than what they do. They may understand, by contrast, the crude geotargeting of the ad networks. But overall they don’t fully grasp the opportunity and that “local” or “geotargeting” is really about reaching particular people in particular places — who will typically buy something or do something in a physical location.
I’m not ready to abandon the word “local” but it has become as problematic as it is descriptive. What do others think?
I saw this piece from a blog written by the SF Chronicle’s food critic Michael Bauer about restaurant goers threatening bad reviews unless they’re “comped” for items:
Recently I got an email from Marsha McBride of Cafe Rouge in Berkeley, alerting me to a problem I’ve also heard from other restaurateurs. Here’s the relevant part of her email:
“Customers have begun threatening to ‘Yelp’ the restaurant if their demands are not met. Cafe Rouge experienced this phenomenon twice within the past month when comps were demanded with the threat that a harsh review would follow on the Yelp website if we didn’t comply. The expectation of how much to comp is also at issue, where a glass of wine, an appetizer or dessert no longer suffices. People do follow through on their threats as we have witnessed. When most restaurants are struggling to pay the bills in a recession economy, bad publicity is the last thing we want to see. On the other hand, comping lavishly in response to overt threats affects the bottom line.”
This really does put restaurants in a tough position. No legitimate reviewer asks for free food or special treatment. To me, this is extortion.
This is a function of a growing sense of empowerment among diners as well as a byproduct of a bad economy.
It’s bad behavior and illustrates the need for a system to prevent sites like Yelp from being used this way to manipulate small businesses. Who knows if such people are actually writing reviews beyond simply using the threat to get a free meal. But it’s the “dark side” of consumer empowerment.
As I previously said I spent a day with Localeze a few weeks ago and was impressed by the company’s vision for the future. Here’s the official announcement:
To close the gap between local search engines, businesses and ready-to-buy consumers, Localeze is redefining the foundation of local search and creating a new market — online content management. Accurate and enriched local business content coupled with broad, local search engine distribution is critical to solidifying the still-fragmented local search engine market and bringing meaningful local business results to consumers.
Localeze provides the deepest, richest and most accurate multi-sourced local business content, including content verified and enhanced by businesses themselves. This premium business content is distributed by Localeze to the largest network of local search engine partners in the U.S. (85 + sites), which captures 90 percent of U.S. consumer searches for products and services.
As Localeze’s core capabilities increase the likelihood of local businesses being found by consumers looking for specific products or services online, over 200 national brands rely on Localeze to enhance, optimize, manage and distribute their business content online. This year alone, the company saw a 95 percent increase in national brands signed.
Acxiom recently announced a deal with Moon Valley software to deepen and enhance its database. But what Localeze is doing is something of a shot across the bow of the industry. It’s no longer enough to simply provide “17 million points of interest” just as it’s no longer enough for local destination sites to simply reflect “name, address and phone number.”
Moon Valley’s Pete Ryan believes that we’re in the midst of a dramatic change in data aggregation, processing and distribution and that “user-generated content” (from consumers or businesses) is going to revolutionize the entire segment. That’s partly what Localeze is talking about and what Google’s recent “two-way” deal with TeleAtlas also represents.
I received some new data from Yahoo! about how consumers are using the Internet specifically to select agents (4/08, n=500). Here are top-level findings provided by Yahoo!:
These data offer more confirmation of the Internet’s influence on consumer decision making. There’s no comparison with word of mouth, which probably accounts for the highest percentage of leads to realtors.
SpotMixer is one of several self-service video ad creation platforms (my original post here). Mixpo and Jivox are competitors. But so are Spot Runner, Spotzer and TurnHere (among others), which offer professionally created video ad content.
In online video (like other segments) there are the proverbial “three legs of the stool”: ad sales, ad creation and distribution. Sales and ad creation are connected, because most ad sales in the SMB sector are “push” sales. As with other self-service platforms the question with video is: how much of the SMB market will step up and participate? I believe the rough figure is about 10% to 15% in the medium term. If I’m correct and this plays out, those numbers are potentially significant, up to two or so million businesses. And there are potentially billions of ad dollars here (more than PPC products).
But then distribution is another issue, and especially important if we’re talking about performance-based video ads (streams, clicks, etc.). Several of the companies mentioned have or are building out distribution of varying levels of quality. For example, is it meaningful to have your video ad on YouTube? Sure there’s lots of traffic but probably not the right audience and behavior. (However see this suggestion about “Video Pages” on YouTube.)
SpotMixer, for its part, has just added Google AdWords and TV distribution to its platform’s capabilities. Here’s a screenshot provided by the company:
The integration into AdWords is significant — others will probably follow suit — because of the targeted nature of the views there (as opposed to YouTube). But the integration with Google TV Ads is also significant because it extends the value of online video ads into cable TV (putting some heat on Spot Runner). And, as previously discussed, there’s considerable potential SEO value to video in a blended search universe.
Still, the challenge is awareness and education: getting SMBs to take notice and understand the implications and potential.
Here’s more from the press release that went out this morning:
SpotMixer provides businesses a solution to create and distribute their TV and video ads. They can either go directly to SpotMixer.com to create a new ad, or, if they prefer, they can submit a bid request from Google’s TV Ad Creation Marketplace for additional assistance. Then they log on to their Google AdWords account and select Google TV Ads (http://www.google.com/adwords/tvads/) and determine when and where they want their ad distributed.
To stretch their ad budgets further, customers can use SpotMixer to re-purpose components from radio or online video ads they’ve already created to use in their television spots. For example, they can incorporate the audio from a radio ad they previously created, and simply add video, photos and text. Of the SpotMixer customers who have created television ads, all of them have used existing assets from other ads, and a majority have used previously created radio ads as the voice-over component. SpotMixer’s easy-to-use tools guide users through the entire process, eliminating the need to re-do creative they already own and like. The average television ad takes less than 30 minutes to create from start to finish. And, businesses can “try before they buy,” since SpotMixer offers them unlimited free ad creation on the SpotMixer site.
Click Icon to Subscribe | searchia on Centro Acquires RealCities, Ki… |
 | Peilin on Looking for ‘Plan B… |
 | Tremolo Harm on Spot Runner Reorganizing |
 | Chris Warth on Unplugging for a Week |
 | va mortgages on Kosmix Gets More Money, Local… |
