There’s a new services directory called LocalTop, which I spoke with about two weeks ago. The site right now is unremarkable and the company is in a beta phase in the SF Bay Area only. However, the innovation is in the pricing model.
Though not unique (HelpHive uses a similar model) LocalTop is one of only a small number of directories taking a commission on a completed project: cost per job, in other words. This is enabling the company with a single sales person on the phone to enjoy an impressive close rate. That’s because there’s literally no risk to the local business.
Several years ago I organized a panel at SMX Local-Mobile dedicated to the idea that local “advertising” online would move from CPM/CPC to CPA. The consensus on the panel was a diversity of business models would co-exist in the market. True enough, but we may see more pressure on market leaders if smaller sites gain traction with the CPJ/CPA model.
The technology and platform behind LocalTop comes out of BackWeb. Rather than reviews, the site is relying on third party certifications, badges and other mechanisms to ensure that only ethical businesses in good standing are included in the database.
The profile also provides lots of detailed information to help consumers make decisions about service providers:
Co-founder Bill Heye told me that businesses that receive complaints could/will be dropped. LocalTop follows up with customers to evaluate their experience.
The central challenge here will be getting traffic and routing leads through their site. With its “no risk” model the company has addressed the typically biggest problem that local startups face: getting attention and interest from advertisers. However, delivering projects to those SMBs requires traffic and consumer usage.
What do you think of the cost-per-job model and whether that will start to take greater hold in the local space?