MerchantCircle, which is partially owned by IAC, is apparently beginning to make some headway in selling search oriented services to small businesses. It reports that it has achieved a base of 5,000 paying customers, who buy services costing $30, $60, $100 and $250 a month. “Most of them are coming in at the lower end” – the “starter circle” package — “but we do have customers at all price points,” said a spokesman.

The company also has 500,000 “registered” users and hopes to have 1 million registered users by the end of the year. Darren Waddell, VP of marketing, estimates that 75 percent to 80 percent of its users have no other Web presence. “They rely on us as their only Web presence. And all the people buying advertising for us, it’s more like 85 percent that have never purchased online advertising before.”

Waddell asserts that the site’s best customer acquisition vehicle is “people bringing in others by word of mouth. Another way people find us is with vanity search. Someone searches for themselves and see they ranked highly and say, ‘who is that? Who built a Web listing for me?’ ”

Indeed, MerchantCircle has prepopulated 15 million merchant listings, which users can enhance with MerchantCircle provided blogs, newsletters and other customer interactions. “We get their listing highly indexed with Google, Yahoo!, MSN and Ask.com,” says Waddell. “So we’re using search as a front door.” Next on the agenda is an upgrade of the listings to videos made with templates. Similar to SpotMixer, such video might be category specific and allow businesses to see what they can do with video as a hook.

Another way that people find the company, of course, is more notorious – an aggressive auto dialer campaign that compels people to go online to register in order to see what someone has allegedly said about them. The company downplays the importance of the campaign, but many people are still apparently receiving the calls.

I have actually gotten many e-mails from irate businesspeople who have received such calls and wanted to vent. Here is one e-mail I got from “Dave” on May 15.

“I received one of the MerchantCircle automated calls in my voicemail box this morning. It said ‘Hello, this is the MerchantCircle Verification Department. We are calling regarding a customer who found your MerchantCircle Page on Google. On Monday, May 12, 2008, this customer asked us to verify that you are indeed a legitimate business. To verify your business, go to MerchantCircle.com and enter your business telephone number in the blue box. Again, that’s MerchantCircle.com. Thank you.’”

But Dave notes that “we do not have a MerchantCircle Page and do not intend to have one.” He may have been unaware, however, that MerchantCircle automatically generated a page for his business. (But who is the mystery customer?)

The frontiers of Web-based, self-serve advertising moved (a little) today, as Trulia introduced Trulia Pro, a new “starter” package for Realtors that provides unlimited “featured listings” and “Spotlight Ads” that Realtors use for branding. Trulia claims its featured listings capability boosts views by four to seven times.

Trulia Pro enables Realtors to place their ads on a “self-serve” basis, avoiding the need for a local sales partner. In addition, the service enables Realtors to mine up to 20 additional cities, neighborhoods or ZIP codes. Listings in exurban Riverside, for instance, could be marketed to people from Los Angeles without busting a budget. Current ZIP code marketing models are more limited.

Trulia Pro is being sold to Realtors for $39 per month, or $348 if they commit for a year. Trulia says the ads will be targeted to a base of 10 million users: 5 million of its own users and 5 million from its extended network. The service replaces Agent Featured Listings, which had been previously discontinued. Prime targets for Trulia Pro are expected to be the 85,000 agents who participate in Trulia Community Voices.

The New York Times is set to recruit small-business advertisers via a deal with AdReady, the Seattle-based ad agency that provides a choice of 600 free templates for banners, customization tools and usage reports.

The Times will recruit its own advertisers via in-house promotions. Advertisers will have a choice of 14 sections of the site that are self-selected by advertisers (i.e., sports, international news, etc.). Alternatively, advertisers can simply choose Run of Site, or opt for self-service geographic targeting, since The Times is positioned as a national newspaper. The program is especially geared toward advertisers with “budgets under $10k.”

In a release, The Times makes a curious reference to serving “the long tail of online display advertising.” I am still pondering that one. It probably refers to the opportunity to serve advertisers that might have otherwise made a Google purchase, even though Google’s text-based advertising might be an imperfect match.

For AdReady, the white-label deal with The Times continues efforts begun with The Cobalt Group and Allrecipes.com. In other recently inked deals, AdReady acts as a media planner with a slew of ad nets, including Yahoo!’s Right Media, Advertising.com and Google.

Kate Kate from ClickZ has more here.

Google and Office Depot announced a partnership where Office Depot will offer advice and teach small businesses how to use Google AdWords. Any small business that registers and makes an AdWords purchase on the Office Depot site will receive a $50 advertising bonus. Office Depot will also likely receive a portion of all sales made through its Web site. The partnership also promotes Google Apps and Maps as additional tools small businesses can use.

This is an interesting partnership for Google, which has been innovative in its approach to attracting small-business owners. Tapping into a retailer that has a close relationship with small-business owners is a new move for Google and if successful could become part of a wider strategy.  
  

SmallTown, the Bay Area hyperlocal company, is changing its core focus and will concentrate mostly on getting wider distribution of its WebCards microsites for small businesses.

While the nine-person company will continue to maintain its hyperlocal sites, which are now in six Bay Area communities, it sees a bigger opportunity in having third parties such as IYPs and search engines selling WebCards, says CEO Hal Rucker. “WebCards.com has always been our vision. It hasn’t been hyperlocal.”

The WebCards are small-business microsites that may be transported along multiple platforms (i.e., Web sites, e-mail, directory listings, etc.). In this regard, they are similar to other providers such as AgendiZe, Mixpo and Wibiti. A major driver of the WebCards is the ability to “encase” video.

Rucker says the cards will be featured on Google Gadget Ads, where he believes they are the first to focus on small business. Talks are also “very far” along with several major resellers.

As for the SmallTown hyperlocal sites, there are currently 12,000 registered users, and 23,000 WebCards. The bulk of these are on a free tier, but 600 are enhanced customers, paying $50. Most of the enhanced offerings have been sold by premise sales, although some have come in via self-serve.

The vast majority of WebCard users are only using one card, but approximately 15 percent have taken out multiple cards. A real estate agent, for instance, might want to have cards for specific property listings as well as for corporate identity.

The company is also introducing featured listings, which are priced at $4,200 per year for the top listing slot, and $1,200 for the second slot. “With six cities and 300 categories, you can see how it would add up,” says Rucker.

In addition to WebCards and featured listings, Rucker says the company is also bringing in some revenue from white labeling its services. The San Mateo Chamber of Commerce, for instance, is one customer.

Rucker notes that the company has also extended its initial $3 million funding from Formative Ventures and others, and has now raised $4.5 million in total.

Elizabeth Gage of PCM International posted a well thought out blog on the challenges small and medium-sized businesses face when purchasing search engine marketing campaigns, either on their own or through Yellow Page publishers. After reading her thoughts on the subject, I couldn’t help but realize that the focus of current SEM efforts has been on getting the appointment and making the sale. Gage’s post, however, highlights the challenges after the sale is made.  

As more SMBs begin to experiment with online advertising, the problem of supporting and informing them of the progress of their online campaigns increases. Based on my own experience in the back-office side of supporting SEM sales, I can attest that new online advertisers simply require more communication on how their campaign is working, numbers of calls generated, how to effectively improve keyword performance, and how best to update their profile or Web site to generate more leads. New online advertisers are in the experimental mode and are not yet sold on the value of SEM, which requires constant reinforcement of the ongoing value delivered by online advertising.  

While gaining appointments and educating SMBs on the benefits of online advertising is important in selling SEM, continually communicating the value of what is being delivered is what will help maintain SMB online advertisers. Failing to reinforce the value to new SEM advertisers ultimately leads to higher advertiser turnover in the second or third year, meaning the sales force will have to continually replace advertisers with more new advertisers rather than work on developing existing advertiser campaigns. 

Search has its limitations for local businesses. In fact, many would just as soon place media rich display ads, but for the expense and creative challenge of developing the ads. That’s the hurdle being addressed by AdReady, a venture-backed Seattle company that has created hundreds of ready-made ads that can be selected on a self-serve basis.

Since launching in October, the company has signed up 9,000 accounts. The clients range from painters and plumbers (along with large companies such as Alaska Airlines). Going forward, the company is targeting such entities as organic food stores.

Backed by $12 million from Madrona Venture Group, Khosla Ventures and Bain Capital, AdReady has developed more than 600 display ad templates covering 16 categories, including such verticals as health, auto, real estate and food and beverage. In the health category, for instance, the ads include a “Golf Back Pain” theme, a “beating heart” theme” and a “signed cast” theme.

The ads are free, so long as advertisers provide AdReady with a 20 percent commission when they are placed on various ad exchange services, including Yahoo!’s Right Media, Advertising.com and Google. In addition to art work and placement, AdReady provides full reports, such as clickthrough rates.

While the ads are available directly from AdReady, the company also makes them available on a white-label basis. For instance, the company is partnered with Cobalt for auto dealer relationships. Reader’s Digest’s Allrecipes.com, for instance, is another reseller. AdReady was started by former Classmates.com exec Aaron Finn. Recently, Finn was joined by former AOL VP Mark Feldman. There are more than 30 people at the company.

The market to produce, distribute and/or enhance small-business videos has intensified in recent months, as TurnHere, Denver MultiMedia, DMC, Spot Runner, Mixpo, BuzzSpot, EZ Show, Spotzer and others have competed (often via third-party Yellow Pages and city guides) to land accounts. Now comes Redwood City, California-based SpotMixer, which has raised $8 million from Kleiner Perkins and others.

Launching next week at Kelsey’s Marketplaces event in Seattle, SpotMixer provides a combination of production tools and distribution capabilities that allow small business to easily make videos on an “all you can eat” basis and distribute them. The service is launching with a subscription “plan” that ranges from $59 to $79 per month, with fees declining with longer commitments. Additional link fees are up to the media partners.

SpotMixer has been developed on the back of One True Media, a consumer-oriented video service aimed at families and young adults since its launch in February 2005. That service, which cost $3.99 per month, simplified the process of producing a video and sending it to other platforms. It has attracted 3 million registrants since launch.

The new service was developed by company founders Mark Moore and John Love, who noticed that a number of SMBs were piggybacking on the cheap tools to create their own videos, and embed them on YouTube, e-mail, their own sites, etc. Moore and Love speculated that SMBs probably needed something a little more “heavyweight.” The founders have since been joined by Yahoo! Search Marketing veterans Kathleen Farley and Brett Gardner, among others. There are 20 people at the company.

A fairly unique aspect of the service is that its reseller partners, such as Yellow Pages and city sites, can “seed” their sites with generic but category-specific videos for each listing, in hopes of upselling them to a specific solution. This approach has been tried a few times with Web sites, but video is a new frontier.

It’s an attractive offering and well-priced. The questions we ask ourselves are whether small businesses will make their own videos, even with easy to use tools; whether they will ever want to produce more than one or two, even producing holiday specific videos; and whether they will develop an aggressive media program if left to their own devices. The transferable, cross-channel approach is also an interesting question mark. AgendiZe and Mixpo have been pushing hard on this front.

I suspect what we’ll see evolve is a segmented marketplace, with different SMBs using different kinds of services at different price points. It seems likely some resellers will soon be pitching fully produced videos and media plans by TurnHere, Denver MultiMedia and Spot Runner, and a second, non-conflicting tier of video enablers, such as Mixpo, BuzzSpot, EZ Show, Spot Runner (again) and now SpotMixer. Eventually, the gap will fill in, right?

The rise of Web-oriented behavioral targeting and the tough economics and unwieldiness of user diaries and phone calls have pushed radio rating giant Arbitron to focus less on radio station ranking and more on providing qualitative data about specific local businesses. The shift might have ramifications across all media, especially in smaller markets.

Leveraging its ownership of Scarborough Research, Arbitron’s new effort will focus on sending out extensive media usage booklets to consumers on a shared cost basis. Studies can have smaller bases, and will be done once, rather than four times, a year. Costs will be shared among local media participants.

Arbitron’s position is that people’s habit’s “don’t change that much” quarter by quarter.

The consequences are that stations won’t be able to use Arbitron data to assert their ranking in the marketplace. Bankers need that data to value radio stations. But advertisers don’t really. In fact, the qualitative data about local media and advertisers may be more effective in station pitches. With the new approach, radio sales pitchers can note,: ‘I have some market data in Charlottesville about your customers,’ including gender, married and Internet access modes.” It is a more specific guide to buying media and targeting consumers than putting out balloons on Saturdays.

The studies will also have more impact than behavioral targeting, which can be overly generic and not provide information about retailers.

Do you really need to have raised millions of dollars to succeed in selling search solutions to small businesses? It is a question that I often ask myself.

Dan Hobin’s G5 Search Marketing in Bend, Ore., is profitable without having raised outside money. Hobin’s secret is initially focusing the five-year old, 17-person company on a specific vertical category: self-storage

Hobin’s brother is in the self-storage business in Southern California. Consequently, Hobin, a veteran of numerous dot-com start-ups such as CyberSource and Beyond.com, knew enough about their needs to try to transition their large marketing budgets to search. These companies typically take out full-page ads in Yellow Pages, and spend $1,500 to $2,000 per month on the Yellow Pages programs, he says.

G5’s search solutions typically run $300 to $500 per month. The money provides a full range of search engine optimization and search engine marketing programs, trackable coupons, dedicated call tracking via VoiceStar, and graphically rich reporting tools. The combination of SEM and SEO is critical, says Hobin. Other companies have focused too much on SEM and miss entire groups of customers.

Currently, G5 serves 30 self-storage companies with over 600 locations. These companies recognize that search is far cheaper than Yellow Pages, says Hobin.  With G5, Hobin estimates that they’re spending $5 to $20 per lead, or $30 to $50 per self storage rental. With Yellow Pages, Hobin estimates it is $150 to $200 per lead, or $300 to $400 per rental. Yellow Pages shouldn’t be abandoned, but other kinds of marketing should be added, he believes.

A typical client profile shows that search efforts lead mostly to phone calls. Sixty percent of users make a call, 20 percent want to use a coupon, and 10 percent seek a price quote.G5 provides search solutions on a wide range of services. But most of the action is with “the Big 4,” Hobin notes: Google, Yahoo!, AOL and MSN. The IYPs and classified service providers, meanwhile, are all described as “second tier.” “If you are an IYP, the only way you get traffic is if you are listed on Google.”

G5 is also doing some advertising on Facebook. It is a good way to reach college students, who tend to be very big users of storage facilities. But it is also very seasonal, based mostly on school semesters. Texting quotes on demand is also popular with college students.

Currently, G5 is adding a set of new verticals to its initial focus on self-storage. The criteria are that categories are dominated by companies with multiple locations — ideally 20 or more. It has already added a focus on apartments. Assisted-living facilities will be next. “The key is they have a high lifetime value, and that we can manage their transition” to online, he says.