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December 30, 2009

Vlingo Top Ten Searches Reveal Mobile Intent

In the spirit of top-ten lists flying at us this time of year, voice search provider Vlingo has revealed the top searches across its mobile apps (via TechCrunch). The list affirms much of what we know about mobile search behavior, including high interest in social networking.

1. YouTube
2. Facebook
3. MySpace
4. Weather
5. Movie Times
6. Twitter
7. Yellow Pages
8. MapQuest
9. craigslist
10. White Pages

One of the key points here is that mobile search involves different intent than online search. Specifically, immediate/action oriented needs such as “movie times,” “Yellow Pages” and “MapQuest” take up much of the list. Compare with Google’s (desktop) top searches, which are decidedly more topical/news oriented:

1. michael jackson
2. facebook
3. tuenti
4. twitter
5. sanalika
6. new moon
7. lady gaga
8. windows 7
9. dantri.com.vn
10. torpedo gratis

The differences in these lists are at the core of the argument that products and content need to be uniquely served for mobile rather than “borrowed” from the desktop.

Put another way, do the algorithms that govern relevance in mobile need to differ from desktop? My desktop search for “McDonalds” might be to find out the history of the company or stock quote, while my mobile search is more likely to find the closest Big Mac.

Misaligned?

Another way to look at this is to note the top categories of mobile ad spending, according to Millennial Media. Which of the two above lists does it more effectively target?

1. Entertainment
2. Telecommunications
3. Dating
4. Portals
5. Retail
6. Consumer packaged goods
7. Autos
8. Armed forces
9. Education
10. Travel

True, these mostly represent display advertising and the lists above pertain more to search. But does it say something generally about how mobile ad spending is misaligned with interest and intent on the user side?

Also interesting about Vlingo’s list: YouTube as the top result indicates a genuine consumer interest in mobile video. This has been a bone of contention over the past year in discussions about mobile television models.

Lastly, the differences here are not only between mobile and online searches, but there is a third variable that’s difficult to isolate: Does it say something about how search is impacted by voice as an input (versus typing)?

Vlingo reportedly has 3 million users from mobile voice apps across most major mobile platforms. Twenty percent of this usage is voice search, the rest going to dictation and other speech-to-text applications.

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Blog: Mobile Local Media
Posted by: Mike Boland at 8:54 am - Comments (1)




December 29, 2009

Ford Brings Together iTunes and Drive Time

Ford has announced that it will include iTunes tagging technology in some new car models starting next year. This will allow users to press a button to indicate interest in a song playing from their HD radio receiver, then download that song from iTunes.

This technology already exists and is sold in some aftermarket HD radio receivers, but this is the first move to bundle it into new cars. It’s also the latest advancement of Ford’s Sync in-car media system, which has been developed in partnership with Microsoft and has already made some interesting moves.

Generally, this concept of making radio content more actionable (download song, etc.), is an argument behind the ongoing radio industry lobbying for broadcast chips in cellphones (see our conversation with Emmis Interactive head Jeff Smulyan).

The idea is that tying a traditional one-way broadcast signal to the two-way communication of a smartphone lets you start to purchase content, or inquire further about programming or advertising of interest. Downloading songs could just be the beginning.

This could not only boost radio user bases and engagement levels, but entice advertisers with new ways to interact with potential customers, beyond the initial impressions that have traditionally ruled the ad medium.

And of course there could be affiliate revenues from iTunes and other sources of music, though terms are unclear at this point. This will be something to watch closely in 2010.

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Blog: Local Media Blog, Mobile Local Media
Posted by: Mike Boland at 11:37 am - Comments (1)




Spreezio Wants to Help You ‘Make a Deal’

Lately, we’ve been hearing more about  shopping search start-up Spreezio, a kind of Priceline for merchandise (TechCrunch profiles it today). In other words, you name the price that represents the threshold at which you’d buy, and then see who bites.

This could come at the right time as we’re seeing more services that give greater control to consumers to dictate pricing. Groupon is a quickly growing service that carries this general theme, and TechCrunch 50 winner Redbeacon lets consumers send job offers to local service providers.

As with the above examples, one challenge is that it can only be as good as the number of merchants that are using the system and responding to offers. So far, the company has reportedly signed up “over 100″ merchants including Macy’s and Best Buy.

The chain-centric approach isn’t surprising nor a new challenge in the local shopping space: inventory data providers such as Krillion and ShopLocal have each tackled the decidedly easier “single point of entry” that is national retailers.

Mid-market and SMB segments will continue to be a challenge, no matter how enticing an offering is.  Incidentally, it does seem to have some enticement as a lead source. Low barrier too; merchants pay Spreezio a percentage of conversions — something Krillion has indicated to be of interest to electronics retailers.

But another issue is that the differences in adoption among store managers could result in an uneven quality experience (will they manage it on an ongoing basis?). They’ll also be attracted based on usage, which in turn hinges on the quality/comprehensiveness for users … chicken and egg … blah, blah, blah.

On the other hand, it could be the right macroeconomic environment for this sort of offering to gain consumer traction. One wonders why it didn’t make a bigger splash six weeks ago. We’ll give it time to prove out.

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Blog: Local Media Blog, Shopping, offline, Shopping, online
Posted by: Mike Boland at 11:01 am - Comments (1)




December 28, 2009

ReachLocal’s S1 Filing Provides New Details About Company

ReachLocal’s S1 filing to raise $100 million includes valuable details about the company. With grosses of $146.7 million for the first nine months of 2009, and operations in the U.S., Canada, the U.K. and Australia, the local search and display reseller has become one of the biggest bets in local.

According to the S1, ReachLocal, which was founded in 2004, has 14,500 active advertisers and 17,600 active campaigns. Most advertisers spend between $500 and $3,000, and represent  a wide swath of local verticals, including home repair and improvement, automobile sales and repair, medical and health services, legal services and retail and personal services.  “Our target market is SMBs that spend at least $5,000 per year on advertising,” notes the company.

A little more than two-thirds of revenues — 68 percent — come from ReachLocal’s sales force, while the rest come from more than 350 third-party agencies and resellers. But the direct sales force is more profitable, and the company’s intent is to focus on bringing in more sales consultants.

Sales consultants that survive the first year (“upperclassman”)  bring in substantially higher revenues than new consultants (“underclassman”), who spend much of their time in boot camp (one week) and other training activities.  The company says it has 438 salespeople in North America and 87 salespeople internationally, and roughly 40 percent  are “upperclassmen.”  The pool of upperclassmen is a little shortchanged right now, however,  as the company slowed down new sales hires in 2009 on account of the recession.

The company suggests that its costs and search costs in general could go up as the economy recovers and more advertisers increase their quotient of Internet advertising.  “An increase in the cost of media in these marketplaces without a corresponding increase in our media buying efficiency could result in an increase in our cost of revenue as a percentage of revenue even if our business expands.”

It also notes that its media costs have already gone up from 52.7 percent of revenues to 55.6 percent, mostly as the result of Google’s 2008 action to  terminate its publisher rebate program in North America.  Google gets the lion’s share of ReachLocal’s spending, although the company also works with Yahoo and Microsoft, and has recently begun providing display ads, and expects to move into mobile ads as well.

Looking forward, the company says it will work aggressively to “address new segments of an SMB’s marketing activities, such as digital presence, reputation management and customer retention.

What do we think? One way to look at ReachLocal is to think of it as a “game of outside sales versus inside sales,” notes BIA/Kelsey President Neal Polachek. “To the credit of Reach, they have gone out and put in place the more expensive channel,” he says. “They can add a telephone channel to assist the outside channel and their economics will actually improve. The other players who are currently inside only (Yodle, Yext) will see their economics deteriorate if they add an outside channel. Also, Reach has worked aggressively in the top 30 markets and been cream-skimming the best Yellow Pages customers.”

But there are other issues, namely churn. “For years, lack of churn in both these areas has been the strength of the incumbent YP players,” notes Polachek.  Now it is more complex.

“The question going forward for incumbent YP players is whether or not they will have the products that advertisers want;  a transformed channel, which can offer them these new products; and the discipline to watch their print dollars erode at the expense of their own proprietary interactive products, even as they are likely re-selling someone else’s interactive products,” says Polachek. “For the newbies like Reach, the question going forward is whether or not they have the ability to aggregate a product set which appeals to the local advertiser and the patience to endure a challenging and path to profitability — only time will tell.”

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Blog: Ad Sales, Local, Google, SMBs, Verticals
Posted by: Peter Krasilovsky at 3:25 pm - Comments (0)




December 24, 2009

Center’d Raises $1.9 Million in New Round

The year-end money deals continue. Today, The San Jose Business Journal reports that Center’d has raised another $1.875 million on top of the $6.5 million it previously raised.  The two-year-old, mom-friendly local search and events planning site, initially launched as “FatDoor,” is led by former Yahoo Marketplaces head Jennifer Dulski and former Microsoft maps exec Chandu Thota. Among its board members is former <a href=”http://www.intuit.com”>Intuit</a> head Bill Harris.

The site is working to differentiate itself from competitors on the city guide side such as Citysearch and Yelp, and on the events side such as Eventful, Zvents and American Towns with an orientation toward mothers, and features such as “Sentiment Analysis,” which, like Marchex’s OpenList,  semantically analyzes what people are saying about local places on the Web, sucking in information from local and travel review sites, review aggregators and blogs.

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Blog: Funding, Social Networking, Social Search
Posted by: Peter Krasilovsky at 12:03 pm - Comments (0)




December 23, 2009

Insights Into eBay’s Classifieds Strategy via eBay vs. Craigslist

EBay is expected to dramatically boost its efforts in classifieds in 2010, so we welcome clues into its historical and current thinking into classifieds via eBay vs. Craigslist.  EBay has been seeking redress from Craigslist, which has diluted its 28 percent ownership share to 24 percent in a bid to squeeze out its influence. Craigslist, meanwhile, is seeking to force eBay to sell its shares, saying that eBay had an oral commitment to dispose of its shares if it ever chose to directly compete against the company, a la Kijiji.

Highlights: eBay feared Google’s entrance into classifieds via Craigslist, and wanted to buy Craigslist as a pillar for a broad international vertical and classified play.

As noted in AimGroup’s excellent, comprehensive coverage of the trial, pretrial depositions showed that eBay’s initial vision was to merge all its acquired classified titles into a single entity that included Craigslist.  EBay also believed Craigslist wasn’t fully monetized and that it could add immediate value with its expertise in product search, trust and safety and international expansion. Another reason that eBay wanted in with Craigslist was to prevent Google from taking a similar position.

But it quickly became apparent that there was a major culture clash between “Top Down” managed eBay, which sought to maximize profits, and “Bottom Up” managed Craigslist, which was driven by its appeal to its community – a position that it took so seriously that it consciously took out a “.org” URL.

Craigslist also turns out to be very conscious of its public image. Desiring not to look greedy to its users, Craigslist did not publicly reveal that Craig Newmark and Jim Buckmaster received $16 million in “extortion money” from eBay to allow it to receive shareholder rights.

A major issue in the trial is whether there was an agreement that eBay would dispose of its shares if it started to compete against Craigslist, as it did in 2007 when it launched Kijiji, and started buying search ads on Google to divert Craigslist users. While eBay acknowledged that there was some kind of understanding, it was never formally included in a contract. Indeed, Buckmaster testified that he felt  eBay was using sensitive, proprietary information to build its competing brand. He said eBay’s behavior directly led to  Craigslist taking its actions to dilute eBay’s shares.

A decision in the case is expected in early January. The judge in the case has said that both sides will be unhappy with the outcome, and he scolded them for not reaching a settlement.

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Blog: Classifieds, Google, Verticals
Posted by: Peter Krasilovsky at 12:53 pm - Comments (4)




ReachLocal Files for IPO

ReachLocal, the fast growing search and display sales channel for small businesses with operations in the U.S., U.K., Canada and Australia, has filed with the SEC to raise $100 million in an IPO. The company recently reported that it has 500 + salespeople and 300 staffers.

Reach earned $146.7 million in revenues in 2008, up from $68.4 million in 2007. It had a net loss of $7 million in 2008. It has raised more than $60 million, including $55.2 million two years ago, when it was rumored to be valued at $305 million.

The IPO, assuming it goes out, will be closely watched by other SMB sales companies that may pursue a similar route, including WebVisible, Yodle, Clickable, Matchcraft, Orange Soda and others. Marchex has been public since 2004.

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Blog: Ad Sales, Local, SEM, SMBs
Posted by: Peter Krasilovsky at 11:06 am - Comments (0)




December 21, 2009

Yoogle: Not to Be

Michael Arrington is reporting that Google’s rumored Yelp acquisition has fallen through in late stages. More details will likely emerge over time.

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Blog: Local Media Blog
Posted by: Mike Boland at 8:10 am - Comments (0)




December 18, 2009

Google/Yelp Rumors (Yoogle?)

Rumors continue throughout the morning after last night’s TechCrunch post that Google is in talks to buy Yelp for half a billion dollars. The New York Times has more details and is practically “calling” the deal in the way of election night news desks.

If true, this will be a big deal for the local space, if that’s not an obvious statement. There are lots of implications, which we’ll get into, but for now it’s notable that it is a different kind of acquisition for Google. This is one of the first consumer services Google has acquired with direct relationships to SMB advertisers.

It’s also significant that Yelp has a sales force. COO Geoff Donaker told us at last week’s Interactive Local Media show that 200 of the company’s 300 employees are advertiser facing in some way, including account rep or direct sales positions.

Google has always maintained that it’s not in its strategic interests to  buy or build a direct sales force to access the elusive SMB marketplace at the heart of its “long tail” paid search efforts. That’s kind of true but this deal changes it a bit.  Both companies have meanwhile been pushing hard over the past few years to give SMB advertisers better tools to manage online presence.

Google has also reinvigorated its buying activity lately (AdMob, etc.), seeming to be on a kind of holiday shopping spree. This one isn’t as easy to give a cute name mashup, the way these deals often are (Goelp??). But M&A will continue into 2010; CEO Eric Schmidt has publicly implied as much.

For Yelp, the deal means lots of things including resources for expansion plans, many of which we discussed with Yelp CEO Jeremy Stoppleman a while back. Yelp has received $31 million in funding to date and has a reported $30 million run rate.

Again, lots more to talk about here, which we’ll reserve for the deal’s confirmation. Meanwhile, another possibility: leaked details cause another buyer to step up…

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Blog: Local Media Blog
Posted by: Mike Boland at 10:45 am - Comments (0)




December 17, 2009

RepairPal in $4 Million Round

The battle to win a digital slice of the $150 billion auto repair marketplace heated up a little today as RepairPal announced a new $4 million round, adding to $3 million it previously raised. The round was led by Tugboat Ventures and includes several individual investors.

RepairPal focuses on providing leads to repair shops and expert information to consumers. It competes against DriverSide, which raised $5.3 million last March, as well as several regional players, most of which provide static, non-personalized information.

CEO David Sturtz tells us that the site is now getting a million visitors per month between its destination site, its partner sites, its mobile applications and partnerships with Cars.com, AOL Autos, Belo Interactive, AutoNation, AAA of California and others. “This funding will allow us to grow every aspect of our business,” he says.

Sturtz adds that RepairPal’s database can generate more than 70 billion individual ‘RepairPrice’ estimates and the company now has close to 1,000 shops and dealers subscribing to its lead generation product, AppointmentsPlus.

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Blog: Local Media Blog, Verticals
Posted by: Peter Krasilovsky at 4:35 pm - Comments (0)




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