Fragmentation of Directories on Handhelds...How Many Apps Does it Take?

I’ve been delving into local search applications that have been specifically designed for iPhones and have been struck not only by the sleek designs of the apps but also by the micro view they offer on how the directory business in general has been unfolding. Directories have moved from traditional rigid category-based search experiences to sleeker search sites and have recently moved heavily into vertical directories incorporating user generated content and other social media.

On the traditional side of the spectrum are tools that act as pocket yellow pages. AT&T is a good example of this type of application.


Launched by Avantar, a sister company to Yellow Pages Directory, the app has a number of features including:

• Auto location detection
• Map & Directions
• One tap location modifier
• A contacts area to “bookmark” businesses
• Tap to call

Firmly rooted in the tradition of the directory user experience, the consumer is still faced with fields to fill. Granted, the bolder tap opportunities make the experience a bit easier but for some reason it still feels like the search experience of old.

Remember the first time you held an iPod? Do you recall the slight confusion surrounding the wheel? How long did it take before you realized “wow, this is a better way”? Well, the newer generation of applications is all about this shift in navigation.

One example of this can be seen with the Where To application. Where To is owned by German based FutureTap and while it is based on the same data exchange as any other directory, the app’s unique proposition is a sleeker, more intuitive user experience. It's currently powered by Google Maps but is moving towards enhanced listing data. So the difference between this offering and that of the traditional yellow pages offering is this:


• Find whatever you want without any typing

Finally, I’ve been watching the vertical directory frenzy manifest itself at the app mall. Applications are popping up that specialize in finding anything from Doctors to Burger Kings. Admittedly, I’ve asked myself (more than twice) if these applications have any future. Do consumers want multiple applications on their handhelds to find products and services that were once contained in one access point?


One vertical that seems to be experiencing significant lift here is the travel/restaurant business. Free apps like UrbanSpoon, Local Picks and Yelp are developing some attention. Even the pricey ($29.99) Zagat app seems to be gaining some users.

In the local mobile landscape the obvious user behavior will always win and the categories of growth will undoubtedly reflect these behaviors. I’m not saying that vertical apps don’t have a place in app land but doesn’t it make more sense for consumers to use one app that streams specialized data from the verticals into one access point?

To finish the analogy between traditional yellow pages and their evolved apps, independent publishers started producing competing books and delivering them to consumers. In some areas across North America, consumers have to chose between more than two yellow pages books!

When surfing randomly through reviews of applications (all applications including games and gadgets), the reoccurring theme on a negative review is "don't waste the space...". I think the app mall is starting to fill up with fragments of utility that users may find interesting for one fleeting search...

The Vertical Advantage...Know What I Mean?

Over the past few months I’ve had a chance to work in the local media planning trenches. It’s been a real eye-opener to business models in the local landscape and one of the benefits has been exposure to the “feet on the street” and the role they play throughout the media planning and buying experience.

Working as an agent allows you to delve deeply into a business sector while representing the company’s media spend. In booking across various business verticals within a multitude of directories/engines, there have been some highlights (as well as bleaker realizations).

Here are just a few…

• There is a major variance in sales service across the publishers. This includes differences in self-procurement, sales contact and follow-up techniques.

• User experiences across the landscape leave much to be desired. Some sites with the most visually appealing content suffer from poor navigation, glaring typos, horrible grammar or confusing messages.

• As new players gun for share in a difficult marketplace, the challenge remains one of positioning the property as a viable advertising platform while generating users to sustain client bases. Marketing budgets only stretch so far, making the right decision on budget allocations is essential to survive.

• Vertical directories, by the nature of their focused content, have great potential to succeed.

Focusing on the last point, vertical directories have an advantage over broader based directories in that they have extremely focused operations. They tend to have been founded by industry members. These members bring a wealth of talent to the table. A deep understanding of a vertical is key to targeting advertisers through personal contacts and industry event networking. From a selling perspective, the ability to speak the same language as your buyer is priceless.

Industry language goes deeper than just lingo like skids, plates or seats. Each sector has its own business owner profile. Profile variances run anywhere from attire and level of professionalism to hard factors like seasonality and peek business day hours.

In the buying seat, being approached by someone close to the industry goes many miles beyond a homogeneous sales representative. They come at the right time, say the right things and most importantly have customized products that simply make sense to the business owner. One of my favourite added features is the business-to-business angle.

Splitting into verticals may not be feasible under all circumstances but for publishers that have a sustainable mass directory working the front lines (granted, not everyone has that luxury), there is time to develop deep content with industry specific customized features. The challenge is in bottling the winning model vertically while not making the mistake of hastily cutting and pasting across various sectors and renaming – that would just be silly.

Social Network Advertising...Push or Pull?

As marketers, we’ve been beaten to death with the notion that consumers are in control. Because consumers that are in control tend to "pull" their media consumption, I've started to explore how social networks are measuring up.

It seems they've entered the space at a time when consumers have a well developed idea of what they want out of their online experience. Historically, consumers have been somewhat limited to one dimensional publisher content.

Pull media traditionally found its roots in traditional vehicles. Consumers could select which magazines to read, which TV shows to watch or what radio station to tune into. Sponsored content was a part of the deal. Epitomizing the Pull media concept was Yellow Pages and other directory publications where without sponsored content, the utility based medium would not exist.

Since the inception of online advertising (just over ten years), we have witnessed a number of applications employing Push and Pull technologies. With half-baked notions of how the Internet could effectively provide Pull advertising solutions to marketers, it started with a Push.

Banners and buttons littered the highways and portals pushed content to the consumers according to what they thought consumers would find appealing. The only element of Pull was established through exceptional brand awareness as most traffic with the exception of Yahoo and AOL (among a short list of others), was generated to existing offline media brands.

Then, email became the cornerstone of customer acquisition and CRM strategies. Early experimentation began with opt-in as a way to employ the appeal of Pull.

Finally, search in all its forms, transformed consumer expectations of media consumption. In my view, no other online application has defined Push more clearly than search.

So what about social networks? In theory, they are based on utility. Utility generally means Pull. But after the users have set up their profiles, contacted their friends and downloaded their widgetry, what is left for them to Pull?

In my research on this topic I’ve created very top line lists of what I deem as Pull and Push characteristics of the networks.

Pull (Consumer Control)

• Downloading widgets, applications and tools
• Interactivity within the tools
• Control over profiles
• Ability to create blogs
• Searching for friends and applying certain parameters to the search
• Access and blocking tools to help moderate who sees what within a user profile

Push (Limited or No Consumer Control)

• Friend status messaging - this includes the poking and the notification of downloads of applications
  
• Chat
• Email
• Banner ads

From what I gathered, it appears that the Pull factor loses it’s steam after the profiles have been set up and the environment has been customized. Enter the clever Knock, Knock cartoon which to me, represents the advertisers' solid understanding of "who's there". The question is, how many people are ringing the doorbell and what else could they possibly be looking to pull from the department?

Even in those media vehicles that have intersected the concept of Pull and Push like subtly sponsored content and Beacon, their success relies heavily on "news feeds" that consumers have virtually no control over. At the end of the day, consumers are being pushed to keep up with the Joneses through real time broadcast of activity.

I think my point (or question) is that although the networks act as an incredible marketing tool using the power of conversation and the customization afforded by Web 2.0, is it possible that we are just jumping from one push oriented portal to the next?

In my view, there are a lot of opportunities for social networks to embrace pull tactics. I'll explore this topic more closely and share some examples of how the integration of Pull media could change things for social networking and the advertisers it could potentially attract.

A Better Mousetrap? Clikity Split

Today Jim Clouse, CEO of ClikitySplit took me through the new local search site that is sure to cause waves in the space.

The Tennessee based company launched only six days ago and is based on a visual mapping platform.

Currently populated with over 135,000 hotels, the search engine allows users to select criteria and have all listings appear on the map in the form of visual billboards. Green dots are collapsed free listings and the red dots are those listings that are actively advertising with rich content.


Jim is going full steam after the traditional search engines citing that the current algorithms throw a major wrench into the user experience and relevancy of their searches. The ClikitySplit model displays all options and lets the users decide what is relevant to them.

While there are a few technical bugs left to sort out (less than a week old), the interface is intuitive and quick considering the rich content it holds.

There are currently four advertising options for local advertisers. The differences are not in ranking or positioning but rather in the content they are able to communicate to users. Advertisers can choose from creating basic billboards containing “quick info” and “specials”, or move up two levels and go full torque with a premium listing that allows them to upload video and audio media to their billboards.

The system is self-procured but advertisers can get support if desired through an account management team.

Perhaps the most interesting piece from an advertiser perspective is the batch uploading tool. For centralized accounts, advertisers can upload an entire database to create hundreds of billboards and then customize them individually through an administrative back office that can be tweaked for permissions. This piece gives ClikitySplit a quick entrance to agencies handling larger national brands as well as centralized marketing directors of franchised operations.

The obvious hurdle to jump will be in capturing market share but Jim was bullish on this. He’s confident that ClikitySplit is the better mousetrap and users will eventually choose applications that work for them. This and a major media effort coming out over the next few months may start the ball rolling.

The platform is built for mobility and applications that work on phones and other devices are planned to launch as early as April.

The company is currently is discussions with potential mobility partners. It will be interesting to see if it gets snapped up with all the M&A’s currently going on.

Local Surfing and the Problem with Tagging

We all know that local search is still not where it’s destined to be but I’m concerned with the apparent tagging frenzy that is taking place right now. I believe it’s driving irrelevant impressions, interrupting the user experience and creating a massive mess to mop up later. In my own research I’ve been struck by the reality that I’m made to surf for local content rather than find it easily through any given local search property. In a Web 2.0 world, how 1999 is that?

One of the larger issues faced by the publishers in local search is the natural inconsistency in inventory by vertical and geography. Over the past few years the industry has pushed itself to simplifying the buying process through arbitrage models. Small businesses are offered “buckets of clicks”, pay upfront and wait for the clicks to come in.

So, it’s in the publishers’ best interest to deliver the clicks in as little time as possible and are therefore motivated to heighten the ad appearances across the media property in the hopes that consumers will click.

As part of this drive to deliver clicks, the notion of tagging has taken off, with publishers offering advertisers the ability to self select categories or “tag” their businesses with in some cases, unlimited tags. The practice is often positioned as SEO and eager business owners are left to their own creativity to develop copy, categories and tagging. The result is an ever-increasing pile of irrelevant data making it difficult for users to find what they’re looking for and ultimately for advertisers to get the truly qualified leads they're after.

Traditionally, the yellow pages industry was more regulated in categorization. Advertisers would gain presence in 3-5 relevant categories, pay and wait for the calls to come in. Rigidity aside, at least consumers got what they were looking for. Maybe this is why directories have such an attractive model – church and state are so clearly defined that the advertiser value of simple inclusion is transparent. Performance models have disrupted this.

I don't mean to pick on the publishers here but this issue is only going to get worse as advertisers continue to invest in their properties. Cleaning up business profiles and bad tags is not something you want to be saddled with in the future. These misplaced listings are starting to look a lot like invasive spam.

Here’s an example of a search done on CitySearch for Pizza in Tampa - the third listing is for Salon Jack - Beauty & Fitness, Barbers, Spas etc...


The same search using YellowPages.com- my search was for businesses that included pizza in the business information. Mettler Toledo is the world's leading scale manufacturer and currently advertises under pizza in Tampa...



And finally SuperPages.com - the second advertiser is "ShopBrite - fast delivery services"...



Ok, I was almost drawn into SuperPages because I thought the delivery advertiser for pizza in Tampa (maybe a restaurant aggregater of sorts) was relevant but upon clicking I landed on this…a results page for courier services?


The bottom line is that the user experience is being compromised in all cases. Self-procurement needs to be supplemented with publisher quality control and that might mean that pricing strategies need to be revisited. Its been almost 6 years since the advent of performance based models and online directories moving to them. Bucketing clicks is not doing the users any favours and in turn, it's doing nothing for advertisers.

Presence still has a value and publishers need to start looking at putting a price tag on it. A hybrid at the very least??

The Four Contenders - Mingling with Social

Inspired by yesterday’s reading of GigaOm’s blog about WordPress’ experimentation with Social Networking, I decided to look a bit further into the subject. It seems there are a number of contenders that appear to have a framework to mobilize a networking platform.

As eMarketer estimates the by 2011, US ad spending on social networks is expected to reach $2.5 billion, it's no surprise that a number of suitors will make their way towards the dowry.

Of the many channels vying to get social, the four that seem most aggressive are email, blog, instant messaging and yellow pages. Here are some thoughts on each:

Email

Quick Stats:

• According to comScore 2007 data, Global E-Mail (does not include non browser based e-mail) receives 556 million unique visits per month.
• eMarketer reports that email penetration is at 91% among Internet users between the ages of 18 and 64. The same report shows that search engine use is the second highest in penetration.
• Yahoo has 80 million users worldwide. According to Yahoo, users spend an average 24 minutes per day using the services. This is more than MySpace, Facebook and YouTube combined (24 min compared to 21 min daily). (Thanks Dave!)
• The only stat I could find on Google was that there were 20 million unique US users to gmail.com since November. (Thanks Eric!)
  

Address books, contacts friends, whatever you want to call them they are the common denominator when it comes to social networking. Browser based email has a big piece of the social pie here. The second step to almost every network around is to import contacts from existing email accounts.

I really liked this blog about Yahoo and Google planning to use their email platforms to create social networks from them. My favourite comment on the subject comes from Joe Kraus, who runs Google’s OpenSocial project, he said: “It is much easier to extend an existing habit than to create a brand.”

It looks like both Yahoo and Google may be banking on this in the future.

I'm intrigued by Yahoo’s "Inbox 2.0" project. The idea of prioritizing mail through visual enhancements according to how important the contact is for instance, sounds interesting. Using email signatures in a way that showcases rich profile information may be the strongest case for this channel.

Google and Yahoo have the masses to impress. The challenge will be to get users to create and implement the permissions attached to the multiple signatures they will inevitably need to get the most out of this platform.

Blogs

Quick Stats:

• The latest number (as of today) of blogs covered by Technorati is 112.8 million. However, this is only a fraction of the estimated number of blogs online. Blogs from China for instance, are not included in the count (representing tens of millions).
• Six Apart (TypePad) has more than 40 million users (bloggers) globally. Source: Corporate FactSheet
  
• Blogger would match if not surpass this number leaving the rest to the smaller platforms in the landscape.
• WordPress for instance, has almost 2 million bloggers. With an average of around 9,000 new blogs created each day. Monthly WordPress activity averages over 2.7 million posts on per month (over the past 5 months).

Anne Zelenka writes that blogs just might become the next social network citing that some of the product features appear to be well suited for the space. Anne went on to describe blogging’s contrast to social networking in that it offers a person-centric way for individuals to come online.

I agree with this view but I also believe that bloggers may have varying identities making it difficult to manage them in one space. A dog-loving nurse may not want to have her pet journal world collide with her private cigar aficionado friends she’s met while blogging on Cohiba-World.

Along with collecting and maintaining member contacts, for social networks to work, they require consumer oriented CMS systems that are dead easy to use and nice to look at. Blog platforms are richer versions of open CMSs and so, have a good deal of the groundwork done.

Chris Messina’s DiSo project (distributed social networking concepts) will certainly be worth watching as it unfolds. OAuth may address the colliding world issue and I’m particularly interested in the concept of “WhiteListing” as I feel this has a multitude of applications for a number of players.

Instant Messaging

Quick Stats:

• ComScore data shows global unique users of Instant Messengers was at 390 million unique visitors for the month of October 2007
• In April 2006 – comScore Networks released results of an analysis of instant messenger (IM) usage in various parts of the world for the month of February 2006. Some highlights included:
• Eighty-two million people, or 49% of the European online population, used IM applications to communicate online in the month of February.
• Sixty-nine million people in North America, or only 37 percent of the online population, used IM during the same timeframe.The analysis showed that IM is most heavily used in the Latin American region, with 64 percent of the online population using IM in February

I had an interesting chat with Rajesh Bathia, one of the founders of buddystumbler.com the other day. Buddystumbler is built on the premise that user behavior is king when it comes to capturing and maintaining active social networkers. The product is still in its infancy but the concept has been mapped out.

Upon registration, users dump all their chat contacts into the platform and go on to create profiles attached to their handle. Rajesh talked of some interesting partnership plans that allow users to display their status, blog and photo updates within the chat environment. Registered users are able to browse the entire network (Rajesh hopes that this will be a major combined share of AOL, MSN, Yahoo and Google).

While there are many factors that make this approach very natural, I am haunted with Joe Kraus’ comment about creating a new brand vs. extending the usage of those that already exist.

Yellow Pages

Quick Stats:

• comScore reports 808.6MM IYP search queries in Q1 of 2007 (including Google & Yahoo) this amounts to around 269MM queries per month
• comScore’s 2006 release of IYP Share Data as showcased on Greg Sterling’s blog last summer showed that the majority (over 85%) of all Internet searches occur on the major search engines Google, Yahoo and MSN.

This leaves yellow pages publishers scrambling to re-invent themselves to gain share in consumers’ ever-fragmenting daily media usage.

The new generation of yellow pages sites have taken some time to abandon their structures which have been deeply rooted in their rigid print legacy. SuperPages.com for one, has made great strides towards positioning itself as a player in this space. The first real movement towards the directory channel's new image was its circa 2004 proclamation that yellow pages are truly the "local search experts". Since then, publishers have been rushing towards social networking opportunities as research continues to point towards localized word of mouth as the holy grail of profitably putting buyers and sellers together.

While those publishers who are heavily ensconced in their past through branding are struggling, sites like MojoPages and Yelp have been built from the ground up to harness the power of socializing in a directory context. These sites among other new entrants allow users to connect with friends and other people in their neighborhoods to share reviews and feedback on local businesses.

With social networking enablers like Montreal-based Praized, yellow pages publishers may be able to transform themselves effectively if they act quickly. Time will tell.

I think the biggest challenge is that directory usage has historically been categorized as just that. Looking to make friends on a yellow pages site brings with it a multitude of issues. Users looking to get an address or phone number are now being asked to fragment their time further to share reviews and look up profiles of other reviewers. User experiences may be compromised as the focus shifts on socializing vs. having accurate, rich directory data.

To date, there has been some success through plugging directories into social networks but the evolution of pure play yellow pages to social has been difficult.

In summary, I have to defer to my theme comment of the day (thanks Joe), “It is much easier to extend an existing habit than to create a brand.” It's hard to argue with the hundreds of millions of email users that have and will continue (for the foreseeable future) to use the application as a mainstay.

With the growing concern over the time wasting going on within the pure play social networks, finding a work around might be the key. To this end, I'd hedge my bets and cast at least a strong vote in favor of email.

In the meantime Google, can you please make it stop snowing? Or at least moderate it?

CRM - It Can't be that Hard

I’m trying to put my finger on exactly why I feel that localized, small business CRM is going to explode over the next year. I know it wasn’t Google’s announcement of their partnership to SalesForce.com and it’s not like contact management systems like ACT! and Goldmine really fascinate me.

Maybe it’s the idea that millions of small businesses with a newfound interest in online media (specifically email marketing), could really use a comprehensive CRM system that provides marketing automation with the same level of sophistication as some of the systems being used by national advertisers.

Just like content management solutions have long been integrated into directories, wouldn’t it be prudent to offer a marketing system to compliment the existing services?

As publishers are under increasing pressure to provide performance models, they must play a larger role in yielding higher conversions for their advertisers. This way they can manage inventory (or offset the cost of a lack of it).

I think I’m starting to get impatient about this topic. It feels like it’s been years since the capabilities have existed. Why isn’t anyone connecting these dots? Granted, they may be busy buying up Pay-Per-Call platforms and what not...but I really believe that this is a huge piece of the puzzle that could go a long way to differentiate one local search or online directory from another.

With all the advancements in this field namely Force.com's multi-tenant "platform as a service" roll out this year, it seems like this investment is a no-brainer.

I have too many thoughts on this to map it all out in a blog. I will have to take this little favourite topic of mine offline for a while and maybe spell it out to those that might listen.

Blocked Traffic on Social Networks & The Advantages of Being Anti-Social

IT Security companies are effectively communicating (or marketing) the need for corporations to be concerned about security and loss of productivity due to employees wasting time on social networking sites. As a result, the valuable traffic to these sites may start to diminish during peak media messaging hours (9-5).

Back in September according to this BBC article, a UK law firm, Peninsula, estimated a loss of 233 million hours per month or £130 million a day by employees “wasting time” visiting social networking sites on the internet.

The estimates were based on a survey conducted of 3500 UK companies, suggesting that some employees spend up to two hours a day visiting social networking sites at employers’ expense.

While findings of the survey were alarming, the Trades Union Congress (TUC) told AFP that the total ban to networking sites would be “something of an over-reaction”.

But earlier this month, Barracuda Networks released a survey based on data contributed by several thousand customers. The survey showed that 44% of companies using Barracuda's Web filtering technology block access to MySpace, and 26% are doing the same to Facebook. The analysis showed that while 19% of companies blocked both the sites, half said they block one or the other or both.

In a separate survey of Barracuda 228 IT security workers, results showed that 53% of businesses restrict Web surfing. This number is expected to increase by 23% in 2008 to 65 percent.

The top motivations behind these restrictive measures were:

• Prevent virus or spyware (70%)
• Control employee productivity drain (52%)
• Lessen the load on bandwidth (36%)
• Liability issues (28%)

In August, Sophos, an international provider of IT security and control, released a report that showed 43% of 600 polled workers said their employer blocks Facebook access completely.

According to Sophos, 41% of Facebook users are willing to disclose personal information to complete strangers. And details such as employment history and mobile phone numbers found on Facebook could be used to launch corporate phishing attacks, security experts warn.

Social networks have been making major strides towards becoming directionally focused. Some have partnered with online directories; some have added business advertising opportunities and many have started to cultivate reviews. If this trend continues and corporations continue to block the major social networks from their employees, ironically, the anti-social characteristics of today’s directories and local search engines may be their greatest advantage. Consumers who tend to plan dinners, movies and other after work activities online may be forced to use less social environments.

I’m getting more data on this…

National Channel...Stuck with the Hot Potato

A couple of weeks ago, Idearc blamed the CMR channel for their poor Q3 online sales performance.

The statement came as a shock as the national channel only represents about 15% of their total revenue. Idearc took this line further when it revealed its plans to get around the CMRs all together. Idearc's attraction to the open market has been going on for about 4 years.

When SuperPages.com migrated from a fixed price directory product to a pay-per-click model, the national channel was last on its mind. To be fair, all the self-procurement tools they were working on over the years were more geared towards the 85% revenue weight of their local channel.

The CMRs' role has been changing dramatically over the past 5 years. Its strengths were historically rooted in driving efficiencies to a super-complex paper wrought business. Its priority was to provide a sales channel to the yellow pages publishers who would provide them with exclusive re-selling rights.

Today, with the evolution of the yellow pages businesses and the increasing migration to the digital channel, CMRs are pushing themselves to become thought leaders in the “directional” space. It’s simple really. To keep the clients, you need to provide value. The value these days is in providing objective media planning services and flawless execution.

Apparently, objectivity doesn’t sit well with publishers. With the acute awareness of the competitors streaming in, they don’t take kindly to the CMRs’ new attitude (questioning “the Matrix”).

Idearc isn’t the only publisher or media property to experience this frustration. I’ve had a number of conversations in Canada and the US about how agencies in general are a cog in the wheel to the publishers. The publishers feel they are doing three times the work to sell their products to an agency (never mind the end client).

Like it or not, clients hire agencies to protect them from the onslaught of media opportunities. The local landscape has many and whether they are self-procured or not, national advertisers will need some objectivity from someone.

I remember this problem in the mid-90’s when thousands of .com’s where being launched. All of them were convinced that they could do a better job selling through to the client. In some cases it was true. In many cases however, I spent long nights getting my clients out of bad contracts that they had done independently.

Results speak for themselves. The national channel will invest and re-invest in products that drive returns. They’re getting better at quantifying these returns and eventually, they’ll get more demanding.

It would be prudent to focus on the product’s ability to bring buyers to the sellers. Integrity wins business.