These are tough, fast-changing times for newspapers, and many of them are taking severe measures to get back on track. Sometimes, it means putting the innovative online guy in charge of print too, as Bay Area News Group has done with online advertising head David Prizer. But sometimes, it means consolidating power under the old print hands that believe they need to “own” the online efforts because that is where the action is.

Last week, The San Diego Union Tribune, for instance, laid off its online leadership: GM Chris Jennewein, Content Head Ron James and Business Development head Jim Drummond. Mark Davis, the paper’s current head of strategy, will take over the Internet operations.

Some anonymous spin in The San Diego Weekly Reader, an alternative paper, suggested that Jennewein and his team probably had to go because of a “disastrous” experiment in the creation of an online radio station, and its decision to provide a bigger news footprint during the San Diego fires last year, removing advertising from the home pages. The implication, I guess, is that the paper should stay on the straight –and- narrow and maximize all revenue opportunities (or whatever the cliché.)

But will the print people clearly see the opportunities inherent in the online world of marketplaces and community? Can they leverage what they have into new businesses? It is a fair question.

I have consulted for SignOn on-and-off for eight years. From my limited interactions with the company, I could see that there had been tensions among the print and online staffs. But I don’t know the real reason for the online team’s removal.

From my observation of SignOn, I can tell you that the site has been a pioneer among newspapers in the creation of email targeting for local businesses; and the creation of sponsored verticals, especially for tourism, such as a SuperBowl guide when the SuperBowl came to town. SignOn also created a business directory that specifically focused on tourism. It has also extended the franchise to vertical directories in print, creating widely distributed eldercare and legal directories.

It also has been a pioneer in the use of multimedia, including photo libraries, podcasts and video. All this especially came to fruition during its exceptional coverage of the devastating San Diego fires, where the site was a community lifeline for hundreds of thousands of people who had been evacuated. I don’t remember any criticism about its decision not to run advertising on the home pages at that time.

What it was doing was building the loyalty of the local audience. Shouldn’t that be priceless in a town where the print circulation is in the low 20s?

The site has also conducted a number of inexpensive experiments, including the Wikis for local community and music scene information; and mobile news headlines, which might be seen as a necessity in QualComm’s hometown. More recently, it created the AmplifySD Radio local music station and the SignOn Radio station, which expanded the paper’s footprint to the work day with weekly shows on such topics as local gardening, dining and online politics.

I will need to talk to someone who can tell me why it was such as bad idea. While there had been some equipment to purchase, the day to day operating costs certainly weren’t very much.

What Jennewein and company didn’t do was jump after every opportunity, and reinvent the wheel with every new thing that came along. They prioritized, and worked within a budget.

The print people will now apparently take over the reins of the operation, determined to focus on both print and online. Maybe they will do better. But obviously, this will only happen if they understand what Jennewein and company have long understood: that their job in not only to sustain existing revenues, but to create new revenues that comes from the opportunities that are inherent in interactive media, and by reaching a broader swath of the dynamic San Diego community.

Ad network AdBrite has announced it will power a new ad management dashboard for concert promoter Live Nation. The eFan Finder application is an extension of the existing relationship between the companies that placed geotargeted event ads throughout AdBrite’s network of 50,000 sites. This now brings campaign management and reporting down to the band manager level.

“We’ve been working with Live Nation for a year and they want their local constituents to know how well all this stuff is working,” says AdBrite VP of Marketing Paul Levine (previously ran Local for Yahoo!). “This works at the age-old challenge in local advertising of tangibility. We’ve built a system to have local marketers see where their ads are.”

This essentially plays off one of AdBrite’s differentiators as an ad network in that it offers site level transparency. In other words, beyond traditional analytics, its dashboard indicates to marketers the specific sites where their ads can be found. Too often in online ad campaigns (SEM and display), ads are fanned out to dynamic ad units ruled by whatever targeting metric is in play; but it’s difficult for advertisers to actually go and see their ad.

This is arguably more relevant for SMBs than national advertisers. The latter has dedicated marketing people that are happy enough with bottom line analytics. But smaller local businesses sometimes need the intangible ROI that is the warm and fuzzy feeling you get from seeing your ad. This is another reason why online video is showing an early relevance to SMBs compared to SEM and other online ad mediums they’ve been pushed.

A full comprehension of local importance seems to be rare for Ad networks. Placecast is doing some interesting things, and AdBrite has the benefit of Levine’s local perspective. Today’s deal is evidence of this, and it has good implications for similar deals in other verticals where there are national or regional entities with localized constituents (auto dealer groups, real estate agencies, hotel chains, franchise based corporations, etc).

“We have exclusivity with Live Nation in events but we’re interested in forming relationships in other verticals where this same kind of dynamic exists,” says Levine. “You can see the same thing in retail, insurance, auto, fast food or any of these categories where its a national organization with local interests. We’re having lots of discussions now.”

Despite some traction by sites like Yelp — OK, specifically Yelp — the hybrid IYP/rating-and-review segment remains something of a question mark in the industry. It remains to be seen whether such sites can attract a large number of frequent reviewers and users — and not just recent college grads and/or mothers. It also remains to be seen whether they can cross the chasm out of restaurants and bars into the gold mine of services traditionally mined by Yellow Pages.

Besides Yelp, other sites abound, including Cox’s Kudzu, Boorah, Loladex and Citysearch’s Insider Pages. But it is hard to get a handle on how well they are doing. MojoPages, a newer Yelp-like site, reports it has been making progress.

A year out of the gate, the San Diego-based site claims a solid base of 500,000 user reviews and 100,000 local advertisers across the U.S., mostly on the backs of partners including Superpages.com, Marchex, ServiceMagic and ServiceMaster. It also has coupon distribution with ValPak.

President Jon Carder, a 29-year-old vertical search pro who previously sold a mortgage-oriented venture to IdeaLab, says the site has been seeing steady growth. He acknowledges the comparisons to Yelp and others, but says MojoPages has been developing its own unique mix of features, including video reviews, e-mail notification for reviewed businesses, and an “ask friends” feature. It also has set its algorithms to bring up more relevant results.

A search on MojoPages for Carpet Cleaners in Sen Diego will get you mostly relevant results, he says. If you do a search for carpet cleaners in San Diego on Yelp, he says, “six of the 10 results aren’t even carpet cleaners.”

Perry Evans has a great post today on the opportunity and threat Yellow Pages publishers face from the verticalization of local search. We thank him for acknowledging TKG’s role in highlighting the emergence of vertical search at our Drilling Down on Local conference last week in Seattle.

In particular, Evans talks about the perilous position IYP operators are in as vertical content proliferates online. He also makes it clear that the publishers have assets to compete in verticals. Evans points out that Avvo may be positioned as a Yellow Pages killer (in the legal category anyway), but online Yellow Pages has the tools at hand to transform itself into an Avvo killer. Whether it does so is another matter.

This whole notion of how Yellow Pages companies can leverage the vertical opportunity will be on the agenda at The Kelsey Group’s Directory Driven Commerce conference, Sept. 15-17, in Atlanta. Check out our preliminary program.

The final day of The Kelsey Group’s Drilling Down on Local conference featured a keynote by Merrill Brown of MMB Media. Brown is an industry guru with a history of developing groundbreaking media strategies and operations. Among other things, he has been editor-in-chief then SVP of MSNBC.com. He also created Court TV along the way.

Brown’s comments served as a fitting capstone for much of the conference – or given his morning time slot, perhaps I should say a prequel to the conclusion.

Brown thinks the various “revolutions” that are shaking up online market-making and marketplaces are in their early stages. Specifically, he believes:

• The newspaper industry is just beginning a period of wrenching restructuring (of its content strategy and business model).
• Verticals will continue to grow apace, to the point where online vertical markets will play a vital part of our quotidian online experience.
• Web 2.0 capabilities (e.g., social networking, video) will become closely woven into online markets.

What was most interesting about his remarks, however, was his overall tone. Brown spoke with the urgency of someone (a guru) who senses we’re in the early stages of a real revolution, and we need to be aware of the magnitude of the changes to come.

AOL may have trouble on several fronts, but it still gets millions of users and it intends to fully leverage them at the local level, per Chris Spanos, Director of Search Verticals, who was speaking at Kelsey Seattle. “Given its scale, local just hasn’t been getting fair share.”

Spanos says the local products will be receiving people, money and time. There will also be vertical investment in autos, travel and health. Previous regimes didn’t see rich opportunities in local and under-invested in the local products, he notes. They also didn’t leverage the relationship between the local sites and Mapquest, which remains the #1 mapping site. But that will change, especially as the city guides and Yellow Pages get relaunched.

AOL is also going to transform its sales effort. While dedicated local sales won’t be brought back, circa late 1990s, new self-serve and partnership efforts will be introduced.

Google is a collaborative partner with all verticals, and generally speaking, has no interest in competing with them, per Adrian Madland, Google’s head of automotive strategic partnerships, who was speaking at Drilling Down on Local ‘08 (a session also covered by TKG here and here).“We love all the vertical people in the room,” said Madland. “We don’t do verticals. We try to make them better. We want to focus on search”

Certain verticals, however, have been singled out by Google as unique business units, which no doubt gives pause to competitors, however innocent Google’s efforts may be. “Automotive has been so successful for us that we have broken it out for a special focus,” noted Madland, a former exec at Ford Direct.

Madland also volunteered that there have been some misunderstandings about Google efforts such as GoogleBase, Google’s giant aggregation site. It is “not about taking over classifieds,” he emphasized. “It is about driving people to classifieds. Our goal is to partner.”

Cars.com President Mitch Golub, speaking on the same session, noted that his company, part of newspaper-owned Classified Ventures Inc., was one of those that are partnering with GoogleBase. “We participate because we want to see what Google is up to,” he said.

Golub didn’t specifically challenge Madland’s claim of disinterest in entering the vertical marketplace. But he complained that different parts of Google seem to be unaware of what the other parts are doing. “There is a complete disconnect between the people working on verticals and (those working with) business partners, like us,” he said.

Whether or not companies like Google ultimately intend to compete, Golub doesn’t believe they constitute a real threat because they aren’t really positioned to do much selling at the local level. The challenge for Google is the sales component. They can do back-end reporting but won’t get far without local sales staff. “We don’t have 700 sales people because we want to have 700 people,” said Golub.

True, Google has done well having third parties sell AdWords for it –including some newspapers. But Golub believes there is also little prospect of collaborative selling between Google and Cars.com (and newspaper sales staff dedicated to auto). “If you think newspaper people going to go out and try to sell your products, they are smoking something,” he joked.

Generally speaking, Golub added that vertical sites have a major advantage over other publishers: “Consumers love our advertising.” He added that newspapers are beginning to finally bet big on vertical sites such as his. But it might have been better if all along, traditional media had been investing three to four percent of their revenue in R&D. “The LA Times didn’t do this three years ago. They didn’t have to.”

Admission Corp. has sold its Spotlight Ads division to Cobalt Group, which provides services to over 40 percent of U.S. auto dealers. The company retains control over its intellectual property and Marketplaces businesses, which account for a small piece of its annual revenue, according to company president Sarah Pate. Those businesses will be sold separately.

Twenty-two of Admission’s 31 employees are being offered contracts by Cobalt, and the company’s San Ramon office will remain open.

Admission is the descendant of iPIX virtual tours used by Realtors and others. It pioneered the use of online product pictures by eBay, and has contracts with many newspapers, Yellow Pages companies and others. It has lately focused on the proprietary Spotlight Ads technology that enables users to search for classifieds and receive an interactive banner of info laden thumbnails in return.

Pate says Cobalt was impressed by small trials it had conducted with the Spotlight Ads, where it saw results double when effectively targeted. She anticipates that Cobalt will be effectively positioned to go after dealer dollars for inventory, and also seek a piece of the $3 billion now assigned to dealer associations, who currently have little or no presence in Internet marketing.

If you believe at all in the “marketplace” vision of next generation commerce, it is hard to dispute that Yahoo! remains front –and- center as a verticals factory. This core strength of Yahoo!’s is especially important to note in the wake of Microsoft’s pullback from acquiring the company.

What accounts for Yahoo’s focus on verticals is the critical “engagement of advertisers and publishers” in areas they wish to target, noted VP Michael Yang, who runs autos, real estate and now health for Yahoo! “Yahoo! aspires to be the starting point of the Internet,” he said at The Kelsey Seattle conference. “We want to increase the size of the funnel at the beginning level (awareness).”

Yang argued that the company’s goal with verticals is to be #1 or #2 in each area. In the case of finance, news and sports, it is already there. “In other areas, we aspire to do that.”

Yahoo!’s traditional focus on community also informs the development of every vertical. “It is where automotive is going, and where we are taking health,” said Yang. “We are taking a truly national, centralized experience” and “trying to be holistic.” Yahoo! is also focused on “exposing new data” wherever relevant.

(This post is excerpted from an advisory written for Kelsey Marketplace clients)

The first day of the Kelsey Drilling Down on Local conference included a somewhat unusual panel with four entrepreneurs in verticals. They talked about the nuts and bolts of building truly local verticals. These vertical pioneers shared their war stories and loads of practical advice. Some of the commonalities to their experiences:

• They worked hard to get advertisers — against heavy odds, in most cases.
• All are now in a heavy growth mode.
• Their expansion tends to be “node by node” (market by market).
• They each took great pains to understand the business models and requirements of the SMBs in their vertical. Most of them have had to adjust THEIR model, as they’ve learned more about the needs of their SMB advertiser clients.

Their stories reminded us that being an entrepreneur is rarely glitz and glory. Real entrepreneurs have calluses and dirt under their fingernails. You could feel their pain, when they told about pounding the pavement and dragging some of these SMBs, practically kicking and screaming, into online advertising. It’s a long, arduous, time-consuming process (which may be monetized someday in the form of a handsome multiple of revenues paid by an acquirer like, say, Yahoo! — or not).

Summaries of the four presentations:

Mark Britton, CEO, Avvo

Avvo is a legal vertical, used by consumers to find attorneys. (The litigious-minded among us probably already have it bookmarked.)

The legal industry is a $225 billion industry in the U.S. The industry spends about $4.5 B annually on marketing. (In print Yellow Pages alone, attorneys spend about $1.3 billion annually, making this the largest single revenue category in print Yellow Pages.)

Avvo provides profiles and ratings for every lawyer in practice (in the states in which they operate). It obtains basic content from its Web crawlers. It also permits individual attorneys to upload information to embellish what is obtained by crawling.

One of its more clever approaches to obtaining content is this: It poses a typical legal question in the “Avvo Answers” section of the site, and several attorneys will post their answers. Of course, this is a “win-win-win” for Avvo, the responding attorney, and the consumer. Avvo gets free (and quality) content, the attorney gets “free” exposure (quasi-advertising), and the consumer gets his or her question answered.

“We’re tearing a page from Expedia’s playbook,” Britten said.

This is also the same thing that Zillow is doing: Going into a highly inefficient market where there is an inherent “asymmetry” of data between the service provider and the consumer, and creating a more level playing field by providing abundant, empirical data to the consumer.

Steve Cissel, CEO, 10-20 Media

Cissel is the CEO and founder Lawn & Garden Search (LGYP.com), a vertical for everything about lawns, gardening, landscaping, etc. He said LGYP.com is the first effective vertical in this space.

He pointed out that the lawn and garden vertical (which includes 11 categories in print Yellow Pages) is a $200 billion industry (total annual sales of products and services). It’s the only major vertical that hasn’t yet been really “Webified.” A key reason for this is the fragmentation of the lawn and garden industry. (Arguably, this fragmentation is driven by the inherent localization of the “raw material” for this industry – flora.)

Seth Gardenswartz, VP, SpaBoom (of BoomTime)

The day spa industry has about $10 billion in revenues. About one-third of its revenues come from gift certificates. SpaBoom makes it easy for spa owners to offer their own “private-label gift certificates” that they sell from their own Web sites.

Spas, of course, are a luxury, high-end business, with a high level of personal service. Perhaps because of this, spas “don’t give a damn about online.”

Through sheer tenacity and shoe leather (at least major change in its business model) SpaBoom has achieved about 12 percent penetration of day spas in the U.S.

It plans to take its format (gift certificates) to additional verticals as well. Gardenswartz announced that the next vertical it will enter is the restaurant vertical. It will be focusing on higher-end restaurants, where gift certificates are likely to resonate with the clientele. It is partnering with Zagat (which was announced today, at this conference).

Robert Johnsen, Director of Sales and Marketing, Mywedding.com

The wedding industry is about $66 billion this year. Mywedding.com is the No. 3 online wedding site. The company is 6 years old, and now has a total of 54 local wedding guides. Revenues were up 43 percent over last year.

It serves a variety of local SMBs related to weddings (florists, photographers, bakers, wedding planners, etc.). It took Mywedding.com about 3 years to build its current base of advertisers. On average, its advertisers spend about $600 on the site annually.

For couples typing the knot (let’s hope it isn’t a Gordian one), Mywedding.com provides a free wedding Web site to handle those oh-so-important details of the modern wedding.