Coupons are hot in a down economy, and printable online coupons — and even mobile coupons — are gaining share in the coupon business. But local SMBs aren’t always in on the game, as coupon sites frequently gravitate toward one-stop national accounts.

Now, Analog Analytics, a San Diego-based vendor, is pushing a clever mobile solution that allows online local publishers to feature display ads that have SMS promotion codes built in. Consumers show the coupon on their phones to retailers for conversion.

Use of the mobile coupon provides complete analytics (impressions, clickthrough rates, texts, e-mail and conversions). Among the 850 publishers currently working with the solution are MediaNews Group, Village Voice Media, Local.com, Wick Communications, Freedom Interactive and The San Diego Reader. More than 25,000 ads are being supported, and the company has just expanded beyond the U.S. with a new Australian operation. Chinese operations are currently being eyed.

Company founder Ken Kalb, a longtime search vet, says the mobile coupon solution is the natural successor to low click display campaigns. The engagement of a local promotion typically boosts clickthrough rates by 2 percent to 10 percent — 10 times higher than national online ads. Revenues might see a 20 percent to 30 percent boost within six weeks of launching.

Kalb notes that the coupons are sold via local sales forces, or alternatively, via a self-serve platform. Affiliate marketing programs from other online coupon companies just aren’t a good alternative, he says. They typically pay just three cents per click. They also don’t offer much support for local advertisers in terms of analytics or upsells.

In fact, Analog’s self-serve platform also offers an upsell gift certificate program, which brings in immediate revenues for advertiser and publisher alike, as well as the “Bigger, Better Deal,” a daily promotion special. It also encourages frequent updating of ad copy and promotions. The platform also enables the development of opt-in marketing lists.

Is it too soon for mobile coupons on a mass media basis? It might be. As a backup, Analog Analytics does support print-out options. But this solution is an interesting one that might bring a source of renewed interest for local media companies. They continue to bring in more eyeballs than other media on their Web sites, but often have a hard time proving their value.

Analog Analytics CEO Ken Kalb is a featured speaker at Marketplaces 2010. He’s on the “Back to Square One: Refocus on Revenues” panel with Adicio Chief Alliance Officer Tony Lee and Matchbin CEO Reed Brown.

I had the opportunity to speak with Michael Pastko, CEO of Coupious a Boulder, Colorado-based mobile coupon platform. Coupious got its start when Pastko and his partner leveraged their experience at Purdue University to launch a Coupious iPhone application in Lafayette, Indiana. While the duo did very little marketing, word-of-mouth marketing helped push their mobile application to potential users. Push seems to be the operative word with Coupious since its model does not push coupons to people based on their geography, but rather allows people to seek on-demand the just-in-time promotional offers relevant to them when they want them and where they want them. Many of its initial customers utilize the platform to run multiple promotions or post “just-in-time” offers to get rid of seasonal items or to push specific menu items.

“In order to win over local businesses, the goal was to replicate the print coupon model to help make it familiar and comfortable to select,” says Pastko. However, unlike print coupons, mobile promotions on Coupious can track the number of impressions, what promotional offerings are performing better and most importantly where impressions are taking place. As Pastko points out, “being able to locate where people are downloading or viewing promotional offerings allows advertisers to understand if consumers are looking at the point of sale, responding to an outdoor billboard, or are in areas of town that might offer new potential for the business.”

While college towns in the Midwest have been a successful launching ground for Coupious, traditional media groups such as newspapers have become the major focus in the past 12 months. Pastko has been careful about his growth plans seeking markets where Coupious can gain a high density of coupons and promotional offerings. “One of the biggest success factors is having enough content to make the application useful. Just like directories, if the restaurants and entertainment venues people expect to see are not in the database of offerings, then people’s desire to use the application decreases significantly.” Coupious’ model is not to aggregate coupons or scrape the Web for other offers, but to deal directly with the advertisers in the market. Pastko is quick to point out that “this gives consumers confidence that this is a legitimate offer and will be honored locally.”

When asked if the recent surge in coupons is a trend born out of the slow economy, Pastko said “coupons and promotional offers are in a trend phase now but the space is going through a transformative revolution where offers will not simply be coupons but will become promotions embedded within key messages making them more relevant and highly geotargeted to the users location. The mobile platform is the ideal device to deliver just-in-time offers, reaching people where they are and when they have a specific need. It’s up to mobile coupon companies to continue to innovate and embed offers within other media to further increase adoption and usage.”

The Coupious application is currently available on the iPhone and Android platforms with work under way to broaden to other application platforms.

Citysearch announced today that it has shifted its ad model for small businesses, moving from the cost-per-click model that it pioneered several years ago to a new model that will drive consumers directly to their own Web sites. The new model provides advertisers with a complete range of SEO and marketing services across the CityGrid network of 100 Web and mobile partners.

The new services are being offered as “CityGrid Complete,” and will use Orange Soda as a partner. As part of the announcement, Citysearch also announced an investment in Orange Soda, which competes with the likes of ReachLocal, Yodle, WebVisible, Marchex and MatchCraft to resell search engine advertising and optimize content. Orange Soda currently works as a reseller for media companies such as Gannett and Freedom Interactive, and also works with franchise operations such as Remax and Jiffy Lube.

Neil Salvage, Citysearch executive vice president of sales and service, said the announcement is consistent with the enlargement of his own job description, which now includes product development on the merchant side. Salvage acknowledged that Citysearch has had a “not robust” search engine marketing platform, and has been searching for a better solution for 18 months.

“We talked with everybody,” Salvage said, and came to the conclusion that Orange Soda is a superior solution with a “robust back end oriented system.” Its SEO solutions “fit somewhere between ReachLocal and Yodle,” he added.

To Salvage, what’s really important about the announcement is that Citysearch is moving away from its complex cost-per-click sales model and toward a fixed-fee model that will boast a wide bundle of services. The move should allow Citysearch to increase its monthly yield from$600 to $800 per advertiser to more than $1,000, said Salvage. “That’s where we need to be.”

Cost-per-click overemphasizes the reseller factor and has become “old school,” added Salvage. “It was built to go after Yellow Pages, but wasn’t really appropriate because the Citysearch product set did not really support that. It was an entertainment site. Now we want to focus our time and energy on platforms and the process,” he says. “We are focused on signing up more publishers, not on owning the [SMB] relationship. ”

Citysearch CEO Jay Herratti is a keynote speaker at Marketplaces 2010, which is taking place March 22-24 in San Diego.

On Thursday’s earnings call, DexOne (ex-R.H. Donnelley) leaders cautiously projected that the rate of decline in ad sales would improve in 2010, from being down 20 percent in 2009 to down between 12 percent and 15 percent this year. The company made the case to financial analysts that its performance in 2009, while dire, was in line with the overall media landscape.

Most critically, DexOne leaders tried to sell the story line that it has emerged from bankruptcy as a stronger, healthier company that is well-positioned to succeed in the local marketplace. Along with other leading publishers, DexOne is offering its take on the “one stop” model where SMBs can go for a simplified solution that delivers leads from multiple channels, including a mix of proprietary and third-party sources. DexOne CEO Dave Swanson doesn’t even like to refer to the business as a Yellow Pages company, even though the core product remains the primary, if diminishing, source of revenues and leads.

“We have evolved far beyond our Yellow Pages roots,” Swanson said. “Yellow Pages is only one of seven platforms we are using today to drive leads for our customers and revenues for the company.”

For the full year 2009, DexOne posted net revenues of US$2.2 billion, down from US$2.6 billion in 2008, a 16 percent drop. Ad sales reflect the value of ads sold for books published during the year, while net revenues account for dollars amortized during the year, since directory revenues are recorded over a 12-month period to reflect the lifespan of a directory. Ad sales are generally considered a better indicator of how the business is performing.

DexOne CFO Steve Blondy, echoing other industry leaders, described the third and fourth quarters of 2009 as the “bottom” in terms of ad sales declines. Ad sales were down 21.9 percent in Q4 2009.

He added that the company is being cautious in its 2010 guidance because the small-business advertiser is not bouncing back as quickly as larger and national advertisers. And that recovery will continue to lag. “Small businesses are not participating in the recovery consistent with [advertisers in] major media.”

Some other earnings call highlights:

• Swanson described the company as following a “merchant centric strategy.” Essentially this means it is all about aggregating the kind of traffic that drives quality leads to advertisers.
• DexOne reported losing 110,000 advertisers in 2009. Blondy said about two-thirds of the loss was the result of companies going under or being locked out for credit reasons.
• Swanson reiterated the recent announcement that DexOne is aggregating Yelp reviews into its DexKnows platform. BIA/Kelsey originally reported this on the Local Media Blog on Feb. 1.
• There was some back and forth on EBITDA margins. DexOne reported a 52 percent 2009 margin, and margins are expected to decline further in 2010. Pressed on this, Blondy shot back that it is a “business decision” to invest in the customer value proposition. “We are getting a diminishing return from cost savings,” Blondy said. “We can’t save our way to success. Our focus is on growing the top line.”

Philadelphia-based 7Mainstreet cofounder Andy Leff got the idea for his company about four years ago while driving to the grocery store. “I was listening to something on the radio about the success MySpace was having with helping rock bands promote themselves, and I thought no company is doing anything like that for small businesses.”

Leff and his father, Ron, have since worked together to build 7Mainstreet into a platform for small businesses to establish a presence online that doesn’t just present listings content but enables them to sell inventory, interact with customers via social tools like blogs, post video, visual images and so on.

It’s kind of like the old storefront concept married with the modern Internet Yellow Pages. Rather than a business listing or info page, the standard offering for a small-business advertising is a commerce-enabled micro site. Andy Leff says one point to emphasize is that advertisers using a microsite can have total control over their environment, where on some sites, their presence can be cluttered by banner ads for competing or even conflicting messages.

The Leffs are currently trying to convince directory publishers, newspapers, catalogs and business-to-business publishers, among others, to white label their solution as a platform for selling online advertising and services to their small-business customers. In particular they’ve focused on the independent publisher space and to date have announced one client, Illinois-based Eagle Publications.

This is a crowded space, but the Leffs believe they have a key point of difference in their emphasis on enabling commerce, rather than just establishing presence.

We asked how 7Mainstreet drives traffic, which is the main challenge facing any independent publisher trying to build an online presence. The answer is a combination of things — all the sites are listed in a common database so all customers benefit from wider exposure than just the publishers that sold them the microsite. Plus 7Mainstreet is active in link building and other efforts to drive traffic.

Andy Leff also says it’s important to level with small businesses about the role they play in the performance of the site.

“You can buy a gym membership, but to get the muscles you need to show up and do bench presses,” Andy says. “If [SMBs] do not use [the microsites], they will not get full benefit. They need to put as much information in there as possible in order to improve their search ranking.”

Self-serve ads will bring the SMB masses to the Web. But they haven’t made much of a dent in SMB advertising at this point. That hasn’t stopped a rush of new self-serve products coming out, several married to social media features. The latest is “minute ads” from AlikeList, one of the new crop of social/directory plays that also includes Redbeacon, Thumbtack, HelpHive, PriceLocal, Center’d and many others.

AlikeList’s Minute Ads allow business owners to create and publish offers on the fly, and change the offers as often as they like. They can be sent out to consumers that specifically request recommendations for a specific type of provider (i.e., plumber).

The Minute Ads are part of Alikelist’s “Business Central” platform, which is being priced at $19.99 a month. Included in the subscription is a “PromoSite,” along with presence and reputation management capabilities that enable customers to see how many people have “liked” or “want to try” their business, or who have clicked to their Web site or phone number.

CEO Jim Delli Santi believes that ALikeList’s like-only platform is highly differentiated from simple reviews and ratings sites (i.e., Yelp and Citysearch). “Review sites are more like media companies broadcasting review content generated from consumers,” says Delli Santi.

In theory, the site also does away with the “volume” problem of not enough reviews on a social site by letting users see “likes” from their friends, friends of friends, and then also from all over the Web.

By focusing only on “likes,” it also skims off the negative reviews. That obviously has pros and cons. I tend to like negative reviews because they provide nuance and important warning signs and make for entertaining reading. But negative reviews may also be the work of consumer vigilantes, and they don’t necessarily help people quickly find a business that they want to use.

AlikeList CEO Jim Delli Santi is speaking at Marketplaces 2010 on a hot session with Redbeacon CEO Ethan Anderson and Reply.com COO Sean Fox.

Centro, the local and regional media service company, has branched off into Web-based support for ad management. The company today announced the launch of Transis, a new division dedicated to automating the “other 80 percent” of the display industry not served by cut rate ad exchanges and demand side platforms. Specifically, Transis has been developed to make it easier for agencies and media buyers to buy premium display advertising by helping everything in one place. This includes all their research, site selection, negotiation, planning and buying, campaign management and billing reconciliation.

In development since 2005, and built at a cost of $11 million, Transis represents a significant “phase two” for Centro, which now has 11 offices and 115 employees. “First, we were helping advertisers place locally,” notes CEO Shawn Riegsecker. “The second part is build media software that would help scale the business for agencies across the U.S.”

But Riegsecker thinks the risk will pay off big time. He notes that many agencies are currently charging a premium for online ads because, ironically, of all the extra labor involved. “The fact is digital is more complex and the digital budget is much smaller. It doesn’t scale very well when contracts are held in different Outlook folders. It takes a long time to process 15 Web sites. Imagine buying 100 Web sites. It just doesn’t happen,” he says. The addition of mobile,video, social and search complicates things even more.

Riegsecker claims that Transis, which provides full-service information for 50 categories, makes buying “26 [percent] to 46 percent more efficient.” He also says it will eliminate the “double and triple entries” that plague ad buyers today. Transis, very simply, opens the way for agencies “to place more creative buys than any opportunity in the past,” he says. “It moves us into a software supported services model.”

Centro, of course, isn’t the only company moving ads into an automated environment. Google last week unveiled DoubleClick for Publishers, which provides many of the same automated features for publishers on the selling side. It will likely complement Transis’ buy-side solution.

As it readies its expected public offering, ReachLocal is branching out beyond its roots as a third-party SMB reseller for Google and others. First, it started selling display. Now it is set to offer improved search optimization, digital presence and reputation management via the acquisition of SMBLive.

Other companies in the space have made similar moves to branch out beyond their reseller roots to solidify their relationship with SMBs. Marchex and Yodle, for instance, have major organic search and reputation management initiatives under way.

The acquisition of SMBLive will enable SMBs to use Reach to publish multimedia content from a single interface to a business profile page, as well as to local directory sites, search engines and social media sites, including Twitter and Facebook. In addition, Reach will monitor local review sites, social media sites, and local blogs for references and comments related to the SMB.

SMBLive occupies a rapidly evolving space that also includes such companies as Google, Yahoo, YellowBot, MerchantCircle, ShopCity, Brownbook and various IYP sites. It started out providing upsellable free Web sites for ISPs that had separated from their Yellow Pages business. A couple of years ago, it launched operations for BT TradeSpace. Last year, it also launched TelMex.

The company has continually added features, such as video and blogs. But the company has recently focused on scalable cloud profiles that are entirely Web based and enable “write once, publish many times” functionality.

SMBLive’s Cloud Profile also enables SMBs to publish updates using e-mail and SMS text messages — tools that they’re already comfortable with. The service also includes a “virtual coach” to remind and encourage SMBs to regularly update their profiles and engage prospects in online conversations.

Are we omniscient? In our year-end predictions, BIA/Kelsey SVP Matt Booth predicted that “mergers and acquisitions between vertical ad platforms and social marketing companies” should be watched for.

We’ve been listening to earnings webcasts for the major global directory publishers over the past days, trying to pick up any clues for how publishers see 2010 developing. Most publishers have shortened their guidance horizon or have stopped giving it altogether. In many cases, the banks and hedge fund analysts on the calls are pressing CEOs and CFOs pretty hard for any indication absent of formal guidance of how the year is shaping up.

What we are hearing on these calls is a hint of cautious optimism that the rate of decline in print revenues has bottomed out and in some cases the rate of decline may be slowing.

For example, here is what SuperMedia CFO Dee Jones said on last week’s earnings call:

“From an ad sales perspective we feel that we are in the valley. Our ad sales for the fourth quarter, on top of what we did in the third quarter, indicate to us that we are in the valley. It is too early to tell when we get out of the valley.”

Jones later clarified that he was referring to the rate of decline in ad sales. For the full year 2009, SuperMedia’s ad sales were down by 18.7 percent. SuperMedia, which emerged from bankruptcy on December 31, has stopped breaking out its revenue performance by segment (print, online and other), which it had done through the third quarter of last year.

Here is what Yell Group CEO John Condron said on his company’s Feb. 4 call announcing its third quarter and year to date earnings (the company’s financial year ends March 31):

“We are still experiencing revenue pressure. However, the rate of decline is stabilizing, and there is a significant increase in confidence.”

Through three quarters, Yell Group posted a group revenue decline of 13.3 percent at a constant exchange rate.

Pressed on this point during the questions and answers session, Yell CFO John Davis conceded that “We have a Long way to go. The rates of decline are still in double digits.”

Still, both Condron and Davis continue to argue that the negative performance of directories, print in particular, is largely the result of the brutal 2008-2009 economic environment, and not a long-term secular shift. A recent (unscientific) BIA/Kelsey online survey of industry insiders suggests that many if not most in the industry believe the declines are the result of a combination of secular and cyclical forces.

At this stage of the year at most directory companies, the (calendar) first quarter and much of the second quarter revenue has already been sold.

These comments suggest essentially that the business is stabilizing and no further deterioration from the abyss that was 2009 is expected. Perhaps there may even be a modest improvement in the rate of decline as the year progresses.

BIA/Kelsey expects 2010 to be a year where the directories business stabilizes. The degree to which things improve in 2011 and beyond will be driven in part by the performance of the economy, but perhaps even more so by the directory companies themselves.

Local/social leaders from Facebook, Yelp and Twitter took the stage at IAB’s Annual Leadership Meeting in Carlsbad, California, this week to discuss what IAB President Randall Rothenberg called “the mobile/social local real-time medium that does not have a name.”

Facebook’s Tim Kendall, director of monetization, said Facebook has essentially introduced “marketing on the social graph” by tracking its unique information, such as “pages,” “events,” “like,” “share” and “connect.”  “We’re getting pretty good at showing you ‘who matters to me’ on news feed and topics,” he said.

Advertising on the site is now in full play. “We have created a social marketing experience that we think it the most interesting social advertising on the Web,” he said. And Facebook’s advertising success is demonstrably strong. “Our click to conversion rate is two to three times other sites. Social wins every time.”

Kendall added that Facebook’s effective CPM ends up being “a couple of dollars,” but that advertisers also come in via the service’s self-serve advertising, which is priced on a flat rate basis.

Jed Nachman from Yelp estimated that the site’s effective CPM was $200. One example, Little Star Pizza in San Francisco, for instance, had 1,500 looks (and presumably pays $300 for the ad). Nachman also noted that on average, Yelp users look at 2-4 reviews before making any decisions.

Meanwhile, Twitter is preparing to launch its first ad product next month, according to Anamitra Banerji, who is “Product Management, Monetization.” Banerji said his prior experience at Overture told him to “innovate really, really quickly before anyone else comes up with it.”

Banerji added that people should “be focused on what you are doing and not worry about what people are doing around you.” He also noted that Twitter is a distributed product. “We don’t see ourselves as a Web site,” he said.

Weighing in on social during a separate session at IAB was MySpace Co-President Jason Hirschhorn. Hirschhorn noted that MySpace is refocused on entertainment and music. “We’re not jettisoning our roots as a social network. But our fans want to be entertained. Not everyone is a publisher.”

Hirschhorn spoke admiringly of Facebook, which has basically deposed MySpace as a leader in social media with almost four times the traffic — 128 million uniques versus 400 million uniques. “The media community itself has its social graph on Facebook,” he said. “But there is a completely different behavior and mind-set you are tapping into when you are a brand marketer.” He noted that MySpace still has information on 13 million bands, and a “16-34 type audience.”