Here’s the ClickZ article with the details (quoting my former Kelsey Group colleague Charles Laughlin). Inceptor was one of the early firms offering what I used to call “simplified search” or “bucket of clicks.” Interestingly, of the recent flurry of companies that have entered the space and are offering to broker SEM and SEO (and calls) for third party aggregators — there are now about seven or eight of them — Inceptor didn’t have lots of deals with yellow pages publishers.
Expect each major yellow pages publisher to follow suit and bring this functionality and these capabilities in house. Newspapers are also starting to offer these same services to local businesses and will probably make an acquisition or two themselves. So there will definitely be more deals coming.
Here are the final two paragraphs of the ClickZ article:
Expecting search engines to reach out directly to local advertisers may be a stretch. “The question is, are they going to put hundreds and thousands of people out there?” wondered Laughlin.
Yes, search engines are reaching out directly in small ways and through proxies to local advertisers. They are trying to figure out how to do it efficiently. It’s no secret that they haven’t figured that out but they’re simultaneously pursuing a strategy of working with partners and experimenting with direct outreach more tentatively.
Google, Yahoo!, AOL and MSN all have sales forces but obviously nothing on the order of the yellow pages (or newspapers for that matter). And clearly they aren’t going to invest in the “HR headache” of building a fully developed local channel. They will thus continue leverage the efforts of others into the foreseeable future.
Laughlin also doesn’t think the vast majority of small business advertisers will want to conduct their own SEM campaigns. Just how long this coopetition will last, however, remains to be seen.
This is absolutely true, most small businesses don’t want to deal with the complexities of SEO and SEM and will gladly pay others to do it for them. That will be the dominant model (YP reselling traffic/leads) even as more businesses do experiment with self-provisioning. Search engines are working in fits and starts to make it simpler to set up and manage search campaigns directly.
(There are lots of things Google, for example, could do to open a more direct channel to the local marketplace. However, the company focuses on developing systems and processes that it can scale globally and so it won’t do something until it’s satisfied that it can scale the offering.)
I’ve made the prediction that within five to seven years about 10% of SME advertisers will be doing some sort of self-provisioned online marketing.
In terms of the “coopetition” remark, the realities of user behavior dictate into the foreseeable future that directory publishers (and newspapers) acquire traffic from search engines. They really have no choice — this is the position all traditional media are now in. Whether or not online yellow pages are able to grow their direct traffic depends in on how they evolve the user experience and whether they can build their brands and effectively leverage their offline assets.