Archive for June, 2009

Off to Nova Scotia

nova-scotia

Off for a 2 week family vacation in Nova Scotia — posting will resume after the break.

Cheers,
Eric

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The Evolution of Pay for Placement

As factors such as reviews become increasingly important in the filtering and ranking of local information, the way local advertising is presented changes.  Traditional pay for placement schemes are replaced by relevant sponsorship.

Pay for placement finds its origins in the Yellow Page book where advertisers pay to be more visible by purchasing larger ads and colour.  This works well in a printed book because the normal mode of usage is to flip through several pages in a category of interest.  Larger ads tend to catch one’s attention and allow the advertiser to communicate more information to a potential buyer.

Ads for Movers in the Yellow Page Book

Ads for Movers in the Yellow Page Book

As yellow page publishers moved online, they replicated this pay for placement approach but replaced the idea of a larger advertisement with being placed higher in the list.  In a pure pay for placement scheme the results are primarily ranked on the basis of payment by advertisers.

Search results for movers from Yellowpages.ca

Search results for movers from Yellowpages.ca

When reviews are added to the equation, a purely commercial ranking of results becomes problematic since the user is expecting results that are ranked on the basis of the reviews and any suggestion of commercial interference in these rankings undermines the credibility of the site.  Yelp, a site focused on community generated reviews for local products and services, adopts the elegant approach of allowing sponsored listings at the top of the search results.  This sponsored result is still relevant to the user’s inquiry and also has it’s own reviews.  The sponsor get’s to choose a review to highlight in their listing.

Search results for movers in San Francisco on Yelp

Search results for movers in San Francisco on Yelp

Of course, Google has always enforced a clear separation between what they call ‘organic’ search results and sponsored search results.  This is the very basis of AdWords.  And in practice, the net effect of the Google approach looks very similar to the Yelp appoach.  The difference is that in the Google approach the sponsored advertising could potentially be anything whereas in the Yelp approach the sponsored result is one selected from the ‘organic’ results and elevated to the top of the list.

Google results for a search for movers in Edmonton.

Google results for a search for movers in Edmonton.

As users expect searches for local products and services to be ranked on the basis of reviews or other factors that are personally or contextually relevant to them we are likely to see approaches such as Yelp’s becoming the ‘norm’ for local advertising.

In Mobile: More Menus Less Search

Mobile Applications on the iPhone are increasingly emphasizing the use of menus over (or in addition to) search boxes providing quick access to frequently needed items.  This has implications for how we need to think about advertising in the mobile, local environment.  I’ll present a few examples of the ‘menu trend’ and then discuss the advertising implications.

Exhibit Number One: Mapquest 4 Mobile

The new Mapquest application for the iPhone features a menu of items you are likely to need while out and about.  You can turn them on or off.  This is a simple, slick and effective approach — the best one I’ve seen so far.

The Mapquest 4 Mobile menu bar

The Mapquest 4 Mobile menu bar

Exhibit Number Two: Where

Where was one of the first local search applications on the iPhone and has always emphasized a menu based approach with an eclectic collection of applications — though one of the options is search.

Where iPhone App Showing Service Stations

Where iPhone App Showing Service Stations

The thing I like better about the MapQuest approach is that I can turn multiple layers on or off — though it’s easy enough to change selections within Where.

Aside: I selected the Bing ad and it took me to a screen showing the weather for Toronto.  I’m in Edmonton.  And every Canadian already resents Toronto centric things.  Fail.

Yelp: A Bit More Old School

The Yelp home screen also utilize a menu based approach.  It’s a bit boring and feels like a return to some of those awful early generation mobile apps.  It’s effective, but something like the MapQuest approach where I could actually see what nearby means would probably be better.  In fairness, Yelp’s emphasis is on presenting you with the review content.

Yelp Home Screen

Yelp Home Screen

An Advertising Perspective

This menu based emphasis presents new advertising opportunities.   One potential approach, is to ‘sell’ featured or sponsored locations.  Looking at the configuration screen of Mapquest’s app, I’d say they are already well down the path on this — notice the branded entities — and lots of space for more of them!

Brand advertising in MapQuest 4 Mobile?

Brand advertising in MapQuest 4 Mobile?

Epicurious: Another Menu Based Approach to Advertising

Epicurious recently launched a very interesting application for the iPhone.  It let’s you browse recipes and then create shopping lists for your trip to the grocery store.  Nice!

They’ve integrated brand advertising in a very nice way:

Brand advertising in the Epicurious iPhone app

Brand advertising in the Epicurious iPhone app

The bottom item in the menu has branded recipes from Stella Artois.  Local advertising – in the form of places where you can actually pick up those ingredients or perhaps coupons seems like a logical extension.

Augmented Reality as a Form of Menu

The evolution of Augmented Reality that I wrote about in my previous post can also be seen as a very clever way of overlaying menus.

Local Advertising in Augmented Reality

As if local advertisers didn’t have enough on their hands trying to figure out how to make themselves visible on the web and in mobile — soon they’ll need to figure out how they should look in augmented reality.

Augmented Reality is where graphics or information are overlaid onto real world objects.  This can include information about stores, restaurants or points of interest:

Wikitude - 500x396 - real

Wikitude is a Wikipedia layer for Android intended for use as a travel layer (as seen in the screen-shot above).  And Dutch software firm Layar will soon release an application for Android.  It looks interesting:

What it Means for Local

Another place where local businesses want to make information about themselves available.  In Layar you’ll apparently be able to turn different layers on and off.  So, I can imagine a ‘dining’ layer with restaurants – one that you can apply filters to for different choices.  It seems like there will be aggregators — so again this is probably an opportunity for intermediaries like Yellow Page Publishers.

Now I can’t wait until someone makes an Augmented Reality available for my iPhone!

(via Read Write Web)

The Impact of Free in Local

Techcruch reports:

Wired editor-in chief-Chris Anderson kicked off his magazine’s Disruptive By Design conference today in New York City with a speech about how the Internet makes everything free, which is the topic of his latest book, Free: The Future of A Radical Price He articulated something that is now increasingly becoming obvious: As products go digital, their marginal cost goes to zero.

and:

In one slide, Anderson comes up with the following rules for media companies trying to figure out how to make money online:

  1. The best model is a mix of free and paid
  2. You can’t charge for an exclusive that will be repeated elsewhere,
  3. Don’t charge for the most popular content on your site,
  4. Content behind a pay wall should appeal to niches, the narrower the niche the better

Applied to Local Search and Advertising

Local search and advertising have seen the ‘free effect’ in action:

  1. In the Yellow Pages, merchants pay for Enhanced Listings.  But on Google listings are free.
  2. GOOG411 (and similar services) provide free directory assistance (albeit without human intervention).
  3. Maps are freely available online (we used to purchase printed maps).
  4. User’s freely contribute reviews.

So, what’s the equivalent of ‘paid niche content’?  Well, I suppose, editorial reviews of things like restaurants might still fall in to this category.  Are there other examples?  But at the consumer end, it seems likely that the vast majority of services provided to consumers will be free.

So I wonder if local ‘advertising’ is really going to morph in to a services business as I suggested in my previous blog post – The Biggest Opportunity in Local Advertising?

The Biggest Opportunity in Local Advertising

Ok.  A bit of a think piece for you.  I have a ‘hypothesis’ on where a lot of local advertising dollars are going to be spent.

The big missing link in local advertising is that a large number of local businesses still don’t have a properly designed and optimized website.  By ‘proper’ I mean one that has decent design, follows basic (local) search engine optimization principles and has at least some level of monitoring and optimization happening on it.  For bonus points, they might have dynamic content like blogs or twitter feeds and do some online (search engine marketing) as well (again, with proper optimization principles in place).

Right now, many people are trying to sell SMB’s lots of other products (clicks from a Google Adwords campaign for example) that are usually pretty useless to them because they don’t have a website that can ‘receive’ them.  And the problem just gets further confounded when you take in to account that these SMB’s really need to be thinking about how these websites appear on mobile devices as well.

This market is ‘sort of’ being served today, but very poorly.  The various services (graphic design, web design, seo, sem, etc.) tend to be purchased a la carte or they are too complicated and expensive for smaller businesses.  Most small business owners don’t know what SEO means or they are intimidated by it.  They fear (rightly so in some cases) being ‘ripped off’.  At the other end of the market are various ‘packaged’ websites that are too ‘toy’ and don’t go far enough in offering a real ‘digital presence’.

So, eventually, some people are going to make a boatload of money by getting the right ‘recipe’ for creating, managing and optimizing the ‘digital presence’ of small and medium businesses.  I like to call this Digital Presence Optimization.  And this management will extend in to things like ‘reputation management’ where you monitor and respond to reviews at various sites — this will become increasingly critical.  SMB’s will need help and guidance on how to participate in the social conversations.

This could be a service offering provided by existing market players like Yellow Page publishers.  It could be done by one of the many new entrants — though I believe most of the current ones are too narrowly focused.  In the absence of a catalyst, it’s likely that this market will be served by lots of boutique, regional providers – existing providers of web services, SEO and SEM who figure out how to package and deliver their offerings in more ‘SMB’ friendly packages.

Call Tracking is Not Pay Per Call

Whenever I talk to people about call tracking in local advertising, they immediately assume that I’m also talking about Pay Per Call.  I’m not.  Or at least not necessarily.

If you want to charge the customer on a pay per call basis, then of course you must have call tracking.

But just because you support call tracking DOES NOT mean you have to charge customers on a performance basis.  It is perfectly reasonable to continue to charge a customer, such as a small business on a subscription basis.  In fact, many small businesses prefer to pay this way – they can budget for it and they don’t get any nasty surprises.

But those advertisers still expect to know that the advertising is performing well and they will get the Return on Investment promised to them by the sales rep.

The combination of call tracking and subscription is actually a best of both worlds scenario for most small businesses.  Why don’t more people provide it?  It seems like a big missed opportunity to me.