Show Me the Money!
So there are Billions out there. But who’s making money now. How will SEMs place bets now to ensure their success? Show me the money!
Moderator:
Greg Sterling
Speakers:
- Ian White, CEO, Urban Mapping
- Shawn Riegsecker, Chairman & CEO, Centro
- Justin Sanger, CEO, LocalLaunch
- Alfred Chow, Head, Yellowbook
Lots of energy in the room for this one. Big variety on the panel. PACKED ROOM.
Live Blogging after the jump
So much potential, but where’s the money!
Justin Sanger – LocalLaunc
“Greg, you complete me” laughter
Lots of hype – for so many of us it’s not the real world. Makes fun of google’s “galactic scale” comment. Content at the galactic scale… what does that mean to us!
The innovators are always just around the corner from making a big announcement. So tired of seeing announcements.
The irony is that the targeted beneficiary of new local ad inventory, local advertisers aren’t benefiting from all of it yet. See Nebulous local search marketplace slide… good slide.
- Local and Vertical and Social Networking are converging – next 2 years.
- Online classifieds – big marketplace
- Local search – lots of types, you must keep perspective! You must differentiate and keep perspective. Depends on who you are and where you are coming from. Unique advertising options even with one inventory provider.
- SMEs are overwhelmed and confused! Even though the innovation is exciting.
- Major Local Advertisers have tried to make sense of it. Try to identify inventory, consolidate into products. make it easy for SMEs to buy.
- SMEs are not coming online and providing content to Google/Yahoo, etc. as expected. They do not ‘buy’ advertising… they are ‘sold’ advertising.
- see cost of traffic slide. Not all inventory sources are created equally.
organic seo is like free inventory
- Majority of audience has gone immediatly to paid search… puts pressure on margins.
- Silos and advertisers don’t mix in local search
- destination and inventory providers must get omfortable iwth the idea of being a component of larger product.
- You may need to distribute advertising outside of your own walled gardens.
- Agnostic local search marketing platform. YPs are becoming platform providers.
- Platforms consolidate complex systems.
Shawn Riegescker
A different perspective – not working with search per se.
media industry ($250B) – for the most part has been scaled on people and spreadsheets. Fine when we were buying print, outdoor, direct mail. but when cable came, stress started, then when the web came, the whole thing fell apart.
If you look at last 10 years, it looks like how people bought off-line media. People are buying less than 20 companies.
When people have well built out off-line planning teams, buyers – 78% of all media spent was going into portals. Local publishers like newspapers, tv stations, LYPs, magazines, etc. were collectively getting less than 5% of all digital spending despite having best content. Why??? media was fragmenting greater at the rate than it was growing.
If an agency is doing right, they should be sending out 3 times as many ad agreements. when clients are not spending more you have a pressure margin at the agency level.? So without a system that takes out friction between national clients and local publishers the money will not find it’s mark.
Newspaper market is in bad shape. Web growth has slowed on newspaper.com to single digits, but these numbers are masking the largest success stories on the web. Why? because 70% of all of the $ reported or attributed is a forced upsell (like “buy this too” classifieds.) Eventually this noise will go away and the real numbers will emerge.? And they will show huge numbers flowing into the local market.
Regional advertisers are next big explosive growth area. Less than 3% spend right now. Because of confusion. Agencies don’t have expertise. (!)
Show me the profit!
Small businesses on one side – a sales/education issue …
on the other side are publishers – greatest cost is sales.
….big money are intermediaries who put the ads across all of the ad networks.
the fragmentation will force publishers to run businesses with fewer people and more efficiencies.
Ian White – Urban Mapping
Where the hell is the money?
- Technical Limitations
- User Behavior
- Search Engine Keyword Lockdown
Stats say “yes” but not “when”
Geo IP lookup sucks
…. for local search.
SE’s claim 99% country level
SE’s claim 95% at state level
- But granularity matters in local search!? (right down to neighborhood level)
- Adwords and YSM let you draw your ads but a SMBs dont’ want to spend a 50M radius. Barber Shops can’t use it in the current state.
Where you are vs. where you want to be.
….therefore…
“you must throw the ball where the customer will be”
What about GPS – Cell ID, A-GPS, wifi?
…. none work perfectly.
So, We must relearn what we’ve unlearned
…users known best
- Tribeca –> 10012 –> Tribeca
- Pseudo concierge
- Leaky AOL data – 20k neighborhood terms and ran it…9% used informal search terms
- Postal codes < used in 1% of searches
Another issue is Keyword Lockdowns by Search Engines
- The Duluth Issue (?) Panama “Duluth MN” freeze on regional PPC campaigns favoring national brand. Was Duluth a place or brand?
- Low volume, high quality geo-keywords are rejected by Google not enough searches.
Alfred Chow – YellowBook? Publisher and sales channel
Who’s making money? (“conferences!” – laughter)
Who will be making money?
- Print yellow pages will make money for a while, but writing is on the wall and they know it.
- Chaos is good, opens opportunity.
- Advertiser has too many options.
- Yellowpages have lots of salespeople. Like “Human Crawlers”
- They act not like the last “mile” … but the last “few feet”
- Google probably won’t hire 10k salespeople, so YP have advantages.
- Salespeople must suppress confusion – speak in customers’ language.
- Yellow pages may be able to sustain longer, not just short burst of activity.
Remainder of session was Loosely organized discussionYahoo will not be able to build out salesforces, but newspapers know they can build out display advertisingHow much of the $100B in traditional media buying locally will migrate to the web?
…Money always follows eyeballs.
…You must keep in mind what’s real dollars vs. attributed dollars. Cross selling screws up the numbers for newspapers, and if you ignore that you will always be looking at the wrong information
…brand ads outpaced direct response advertising first time this year.
…$20-30B Locally targeted Spend in next 5 years (a guess)
….At the expense of traditional yellow pages?
How is user intent established?
…more words in user queries.
…personal search
…behavioral targeting
…Search Assist in Yahoo
Where are they in terms of being accurate on understanding intent?
…Google is best by far.
…Yahoo next.
…MSN — I have NO idea (room giggles)
For off-line businesses, what’s the best way to track conversions?
…Well, it’s a fact: 92% research products online, 96% bought offlines
…Also: 36% off all retail influenced by web now.
…driving directions, send to friend, send to phone, etc. can be tracked.
…coupons, offers, etc.
What Big Acquisitions coming down the road? (room laughs)
… Alfred Chow: Google is not going to buy Yellow Book… NOT going to happen
… you can expect more consolidation… nobody knows what
… Why hasn’t someone bought Yelp yet?? (Sc- Someone is going to)
Are mobile providers collecting data on how we use search on mobile?
…Too early. But they collect everything.
… Personalization will be part of mobile.
out of time.
