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Himmelstein reiterates his view of Internet Derived Yellow Pages (IDYP) and where he believes the broader local search space is headed. He underscores the social and technological drivers behind the momentum. It's a nice mix of technical and strategic information.
TKG Clients can read a recent interview that elaborates on some of the ideas presented in the article.
Last quarter, Google declared in its SEC 10-K filing that it was a "media company":
“We began as a technology company and have evolved into a software, technology, Internet, advertising and media company all rolled into one.”
Indeed. In launching Site Targeting, newly announced enhancements to its AdSense/AdWords programs (site selection, graphical ads, CPM pricing), it truly has become one in a big way.
Lots of coverage already:
I'm heading off to Ad-Tech, but I wanted to register some quick thoughts:
Google is now an agency as much as a search engine.
My colleague Neal Polachek believes that this may be partly a response to the slow development of local as a revenue driver. There may well be truth there, but it's also a response to the logic of the marketplace and the desire of Google to capture branding/awareness dollars that are starting to move from traditional media to where the eyeballs are — online.
Other blog perspectives:
Google's early attempt at search personalization was a real dog. With "My Search History" the company is much closer to getting it right.
Lots and lots has already been written about it:
It's integrated into the Google search interface and results page (once you've registered/signed in) and it indicates your search history, not to be confused with the history of Web sites you've viewed and visited. So it works in tandem with but is distinct from Google's desktop search.
It's accessed from a link "My Search History" in the upper right of the results page. I'm not sure I agree with Chris Sherman that it entirely replaces bookmarks — at least not those embedded in toolbars and browser toolbars — but it appears to be pretty useful.
It's most like A9's search history functionality and, to the extent it's categorized as "personalization," unlike MyYahoo! Search or Ask's new and improved My Jeeves services. Both of those require set-up and active management of features by the user.
Admittedly the Yahoo! and Jeeves applications are more robust, but they're also more complex and therefore less likely to be widely adopted. My belief is that — at least for the mainstream — the future of personalization lies in some combination of passively saved search history, desktop search and My Yahoo!.
Now back to Google in particular.
So what does this mean or do for Google? (Some see it as a catch-up move entirely.)
In other words, there are many goals it potentially serves. I don't agree with Forrester's Charlene Li, who says it won't be widely used by the mainstream. More specifically, I believe the challenge is showing people they benefit and should register in order to use it. Once they do, I think they'll find it valuable and useful.
Privacy issues/concerns are there and could be a potential usage deterrent, but that remains to be seen.
Google built out a massive traffic and advertising network in part by syndicating its search box to thousands of sites across the Internet. The emerging local search market is challenged by the need for critical mass — there's volume, but it's all fragmented and distributed to many many local sites.
Now comes local search syndication for Google.
The Google-AccuWeather deal may represent the beginning of Google's syndication of the Google Local search box (and results), which would help build awareness and broader usage of the product.
The Google Local search box appears in the upper right after a user queries for a local weather forecast (e.g., New York, NY). It then allows users to employ the full Google Local database to search for anything in that city. For example, Sushi, New York.
AdWords appear at the top of the page, followed by Google Local "organic" results. This is identical to what a user would obtain on Google Local itself. The mapping functionality is more limited, but nearly the same.
If this is just the first of many such local search box syndications — others such as InfoSpace and Interchange have already been doing this for some time — it could greatly accelerate the flow of local search traffic to Google. Ultimately that could yield separate Google Local advertising inventory entirely distinct from that displayed on Google's general results pages.
In other words, Google may well be laying the groundwork for a separate local distribution network as a new strategic approach in building out local search.
Yahoo! has partnered with U.S. retail giant Target to allow consumers later this year to manage/order prints online and pick them up at a local Target store. This closes the loop for Yahoo!'s photo site (Yahoo! just purchased Flickr) and extends it into the physical world.
That benefits Yahoo! in a couple of ways; it's also a win for Target.
There's considerable data, including from The Kelsey Group, that indicates consumers conduct research online, yet purchase offline at rates well above 90%. To provide some context, total 2004 e-commerce was valued at US$69.2 billion, which represented only 1.9% of U.S. total retail sales, according to the U.S. Commerce Dept.
However, the Web influences more and more of that offline buying. In a general sense, this Yahoo!-Target deal is a reflection of that larger trend. It's also a potentially successful marriage (a la Yahoo!-SBC DSL) of an Internet giant with a traditional, offline entity.
Amazon has been doing this sort of thing for some time. Expect to see more such partnerships and online-offline ("multi-channel") integration from here on.
The Yahoo!-Target deal reflects the understanding on Yahoo!'s part of the importance of a physical distribution point for photos (most Americans, even those with digital cameras, don't have the capacity to print photos at home and would rather not wait for photos in the mail). It also shows Target's acknowledgement of the Internet as a strategic way to acquire customers and potentially maintain loyalty. And while Target has an Internet site, it doesn't have the traction in the online photo arena.
There are many places consumers can get photos developed. And in certain parts of the country, drug store chains, such as Rite-Aid or Walgreens, are often more locally convenient than Target.
But with this deal, consumers may well be inclined to drive farther to Target (and while they're there, why not check out some of those weekly specials . . . ).
Can a similar Google-Wal-Mart deal be far behind?
At Drilling Down, Hearst's Lincoln Millstein mentioned a seminal article in his great keynote yesterday — a wired piece discussing the so-called "Long Tail."
In search, the tail is ultimately where the volume is. But it's also a long-term proposition and the most challenging area to address, from both a consumer and an SME-advertiser standpoint.
I'm briefly recovering from our conference and will be back with more later.
I'm bogged down — I mean delightfully engaged — here at our conference and so have been unable to comment on the range of stories of interest that have come out over the past couple of days. But Yahoo!'s earnings were striking. I'll write more about this and other developments in the next 24 hours.
However, one thing that's very curious and even paradoxical about the big Internet brands and the run-up to their earnings reports is the following dynamic:
Yahoo! CEO Terry Semel offered a bland statement in prepared remarks: "We are on the cusp of witnessing a significant increase in engagement of consumers on the Internet and believe we are best positioned to capitalize on the many opportunities to which we are exposed."
Yahoo!'s now relatively well-diversified revenue streams, its position in the SME/local marketplace, its ownership of Yahoo! Search Marketing (the company formerly known as Overture) and its recent moves into the film/television arena generally validate Semel's remarks.
In a move that surely represents the beginning of a broader, European expansion of Google's local strategy, Google Local UK has launched with results from Yell.com.
The look and feel are the same as Google Local in the U.S., except that Keyhole mapping is not part of the offering at this time. Eddie Cheng, eBusiness director of Yell and who is attending Drilling Down on Local, seemed very pleased by the development in private remarks to me.
The deal is not unlike Canada's YPG-Google deal of last year in which the former provides all its local merchant data as a structured feed to Google Local in Canada.
Mobile Local will follow, no doubt, in the near future.
Yell.com, unlike many of its American IYP counterparts, has been dominant in its markets for local search (and in the U.K. owns the "Yellow Pages" brand). It will be interesting to see how this affects consumer usage (if at all) of Yell.com going forward.
The NYPost reported that the Wall Street Journal's online edition was for the first time more profitable than its print edition — big news. What are the takeaways?
This development reflects the increasing trend/preference for getting news online vs. traditional print. But don't look for papers generally to be able to duplicate what WSJ Online has done.
Charging for content online is something that most newspapers will not be able to do, chiefly because of news aggregators such as Yahoo! News, which keep getting better, and the proliferation of RSS readers, which similarly provide access to hundreds of information sources.
Online classifieds competition makes the task of relying on advertising also challenging.
Just had a fascinating conversation with Chris Henger, who's in charge of marketing and product development at Performics (part of DoubleClick).
Among the many things we discussed in preparation for his panel at our upcoming Drilling Down on Local conference was where search/SEM fits in the overall media mix.
Heretofore search has been seen by marketers as primarily a "direct response" or directional medium (a la Yellow Pages). And it is. But it may ultimately be most effective as a marketing medium in that gray middle ground between awareness and conversion — consideration.
Data from a broad range of sources, including The Kelsey Group, show that consumers are using the Internet extensively before buying (mostly offline). This is where many consumers are using search engines — to do product research, price comparisons, local service provider research, etc.
Online, consumers may ultimately "convert" or transact on specific retailer sites or vertical sites or IYPs (data reflect people continue to use IYP sites when they're ready to buy). But this broad consideration/research phase is perhaps where search delivers most of its value to marketers.
This way of thinking is arguably different from thinking about driving transactions from keyword buys. This way of thinking also sees paid search as a medium that is complementary to or works in tandem with other media buys. It recognizes SEM as a way to engage the consumer at a critical point in the buying cycle when s/he is capable of being influenced before making a buying decision that may ultimately happen elsewhere.
We'll be exploring these and other implications of the comScore-Overture and comScore-DoubleClick research on Chris's panel at the conference:
The comScore-Overture Study: Findings and Implications
The widely publicized findings of a seminal comScore-Overture study will be explored in depth. The study found that 25% of search engine users ultimately purchased a consumer electronics product and that 92% of those purchases were offline. Generic search terms drove more than 70% of the volume, while trademarked terms were responsible for 20% and product terms the final 10%. Though the generic terms drove most of the volume, the more specific terms revealed consumers who were closer to a purchase decision. The study challenges conventional assumptions about consumer behavior and suggests important changes that will likely occur in search. Those shifts will have implications for other online media as well as the local marketplace.
Anne Frisbie, Senior Director, Category Initiatives, Overture
Chris Henger, VP, Marketing & Product Development, Performics
James M. Larrison, SVP, Corporate Development, comScore Networks
Kevin M. Ryan, Search Editor, iMedia Communications
Christopher Skinner, Managing Partner, MakeBuzz
