Recap: Kelsey Group’s Interactive Local Media Conference

MIHMORANDUM NO. 571 | December 15th, 2009Reader Comments (8)

Kelsey’s Interactive Local Media show was truly one of the best industry conferences I’ve attended.  The focus was very different from the typical SEO show, with only one or two tactical marketing panels but a lot of insight into how the major players approach the ideas of local search and marketing to small businesses. The networking was exceptional, with a number of high-level discussions of fascinating products and services emerging in the space.  Program-wise, I loved the fact that there was only one track (although interest level in each session becomes a prerequisite with this model).

The whole experience was overwhelming (in a good way).  Representatives from companies like Twitter and Facebook were typically more open to share mindsets than at a typical SEO conference.  I found it amusing on the one hand, frustrating on the other, that no one seemed willing to challenge Google on any of its initiatives in the SMB space (note to Kelsey Group–I think Mike Blumenthal would make an excellent addition as a speaker in this context next year).  Both Acxiom and Localeze had a major presence at the show, and many of the top citation portals were there as well.   I’d encourage most Local SEOs to attend next year if only for the inside track on trends for 2011, and to meet representatives from the portals with whom we work every day.

In fact, the networking opportunities were so good that I unintentionally spent more time in the foyer of the conference ballroom than I did at the sessions!  But a number of them did demand my interest to the point of attending and summarizing.  Fellow attendee Andrew Shotland also has a number of session recaps that may fill in the gaps.

Takeaways

General: I was struck by the opportunity for small marketing shops due to the need for these larger enterprises to scale each one of its services.  Andrew, Steve Espinosa, and I were the only SEOs in attendance so we tended to get a lot of questions even off of our panels.  The conference presenters and exhibitors placed relatively little emphasis on strategies to help businesses rank in the 7-pack (which in my experience tends to be the first question for SMBs interested in local traffic).  There was a lot of interest around paid search and reputation monitoring, but little in the way of organic offerings.

Also, there seemed to be quite a bit of resistance to taking on SMBs with a budget of fewer than $500/mo. due to the cost of “on-boarding” them.  As a small business owner myself, this does not seem like a trivial amount, and I wonder about the effectiveness of that strategy.  At some point, companies might need to consider taking lower margins in order to reach wider market.

Anamitra Banerji, Twitter:

  • Location-based usage on Twitter: User-opt-in via mobile apps via API.  Lays groundwork for future businesses to build on
  • Goal is to “make it easy for people to say where they are” (in addition to what they’re doing) by saving them characters in each Tweet
  • Twitter is going to start to attach context to tweets that are not KW-dependent.  Providing additional metadata around the tweet means a larger inventory of relevant content to search & leverage for third-party apps.

Tim Kendall, Facebook:

  • Facebook’s self-service ad model is working well & they’re going to make a push to get involved with Local in 2010
  • Mike Boland highlighted that Facebook pages are an excellent “first website” for a small business & that there’s an incredibly low barrier to entry for these pages
  • To his point, Facebook has over 5,000 businesses sign up for a page each day, and has enabled over 1 billion customer-merchant interactions
  • Tim highlighted that Facebook.com may not be a destination site in 5 yrs — Facebook is very excited about the social layer that the FacebookConnect API enables for other sites
  • They’re looking to layer in both geo- and social proximity to FacebookConnect moving forward
  • Social graph: from a base of 100 fans, there are 15,000 one-degree-separation of possible NEW customers for businesses
  • Everyone wants to try to start extracting sentiment.  But the people one trusts for a pediatrician recommendation might be different than for a taqueria. Note, this may have been said by Kara Nortman of Citysearch, unfortunately my notes are unclear

Chris LaSala, Google:

  • “We would like the Fairfield Public Library to engage [by claiming its listing]”; I think this mindset is representational of the burden Google is placing on SMBs despite a multi-billion-dollar ad opportunity
  • Only half of the audience was familiar with what a Google Place Page was
  • Usage of Maps is now at a point where Google is pretty happy; they’re now starting to iterate more quickly on the monetization side
  • Chris made no mention (in fact, actively dodged) questions regarding any support mechanism for the LBC
  • Google is “waiting to get more information about the LBC” before considering any possibility of opening up something akin to an Adwords Multi Client Center.  The system was created exclusively for business owners to self-verify.

Mark Josephson, Outside.In:

  • The definition of what is Local content, as well as the amount of this content is exploding.  The cost of distribution has shrunk to nothing.
  • The business model for becoming a source of local content is more about an ecosystem than any one player dominating the space.
    • Some companies will have local sales force
    • Some will have a larger audience
    • Some will have better consumer contributions
    • Local bloggers are all in it together.
  • Outside.In’s role is to reduce costs & reduce friction between all of these parties
  • Outside.In currently pulls from over 40,000 sources of content, aggregating them into over 50,000 neighborhoods

Lem Lloyd, Yahoo:

  • Companies without brick-mortar locations STILL want to play in Local Note: interesting to think how the 7-pack has affected these types of businesses
  • On the publishing side, defining advertising metrics purely by clickthroughs is a dangerous path

Scott Tobias, Village Voice:

  • The Village Voice’s goal is to be the reference point when people think about LIFESTYLE in their local market
  • Village Voice media reps have been doing business w/mom and pop advertisers for years.  They were one of the first online destinations where SMBs spent ad dollars.
  • Putting the network together demographically/vertically is key to Village Voice’s business model – selling ad packages for VV food, UrbanSpoon food, AND Eater, for instance.
  • Creating synergy bet. print & offline is really hard to do – cross-platform practices
  • I’d say somewhat counter to Outside.In, Village Voice doesn’t believe in the long-term power of long-tail hyperlocal content–it needs to be “good traffic” for advertisers in the long haul

Court Cunningham, Yodle:

  • Yodle’s goal is to connect SMB’s with consumers in such an easy way that they can’t imagine doing it any differently
  • The SMB needs the power of a 10-person in-house marketing department but doesn’t have the budget for it; presumably Yodle becomes that outsourced marketing department
  • Yodle has seen that 25% of leads that its customers are paying for go to voicemail or are unanswered — come on SMB’s, get with the program! :)
  • Google is increasingly favoring merchant sites themselves, fewer directory sites–big threat to directory-oriented sites
  • Verticalization is coming quickly — different advertising models will evolve for different verticals (restaurants, petsitters, home contractors, etc.)–presumably this evolution also means “survival of the fittest”–interesting insight

Kirsten Mangers, WebVisible:

  • WebVisible’s idea is to create  a suite of products and services that fits that SMB owners can choose from within their budget
  • Among their customers, the total average annual spend is about $1200/yr–much closer to what I would have expected; see my comment re: $500/mo in opening remarks
  • WebVisible offers multiple media buys & is agnostic toward which buy is better for any given business–great idea
  • High lifetime value per customer for online marketing; important to layer in service right from the start

Andy Vogel, L.A. Times:

  • The Times has lots of individual brands developed within editorial side under their corporate umbrella
  • Their company has one sales force that sells across all platforms
    • Echoing Court’s idea of the 10-man marketing department, “Every hunter has a farmer has a customer service rep” in the L.A. Times’ sales chain – SMB’s have a dedicated TEAM working for them.
    • Education is key to make process/results NOT be a black box.  They conduct vertical seminars to learn about SEM.
  • They are not seeing a 1-1 relationship between hyperlocal content and being able to monetize SMB advertising around that content…yet?

Geoff Donaker, Yelp:

  • Yelp served 26MM uniques last month versus 15MM in late 2008.  Note, others found this to be a signal that Yelp’s growth might be flatter than Facebook or Twitter but I still think that adding 11 million visitors YoY is pretty darn impressive.
  • What made Yelp work?  1) They started using a one-city-at-a-time model that went against conventional wisdom.  2) Their review filter creates a level of trust from users.
  • Yelp now has 8.5MM reviews; keep in mind that out of 16MM small businesses in the U.S., only ~3.5MM have even ONE review online (statistic from Matt Booth of TKG)
  • There are a surprising number of long-tail reviews on Yelp; 29% are restaurants, 22% have a “retail” focus
  • Many Yelpers see the site as their “lifestyle blog”
  • Nice to see that Matt Booth was somewhat critical of Yelp’s monetization strategy as restaurants tend to be high-churn, low-spend businesses (vs. doctors or lawyers)
  • Geoff contended that Yelp was cash-flow positive in Q2 and Q3 of 2009; they’ll be negative again next year as they expand to additional markets, however.  Booth did some incredibly quick math to speculate that Yelp’s revenues were in the neighborhood of $45MM last year based on advertiser stats and employee numbers provided by Geoff.
  • Although I am not a Yelp “fanboy” by any means, frankly I LOVE Yelp’s expansion model:
    • When Yelp expands to a new city, a small team of paid scouts actively verifies and cleans up the YellowPages-type business data that Yelp starts with
    • They seed a handful of reviews and take photos of some of the more popular businesses in their town or neighborhood
    • A paid community manager is then hired by Yelp for that given city
    • They have 33 community managers in US and European cities to date, who are the face of Yelp for local media and Yelpers in the major markets
    • This process takes 18-36 months in a given city to get a critical mass of data in long-tail categories; however, I’d argue that it’s one of the reasons Yelp’s content is so valuable compared to a traditional IYP (or even Google)
  • Yelp is happy to partner with companies to display some of their review data as long as attribution remains very clear
  • Geoff defended the attacks of favoritism or extortion with respect to sales reps and small business owners as “confusion in the marketplace”
    • Geoff did admit that Yelp’s biggest challenge is that users love them but businesses are afraid of them
    • They’re doing a much better job of outreach this year
    • “Tens of thousands” of SMBs are now signed up for Yelp for Business Owners
    • A flat-rate product ad product is coming out soon

Miscellaneous

  • Directory-building: there are a number of sources of third-party data willing to give it away if you look hard enough–the example Panos Bethanis of DirectoryM gave was the Massachusetts Association of Auto Dealers
  • Kenshoo Local is a pretty slick-looking PPC management interface, although I don’t have the experience in that world to judge its uniqueness
  • Both MSN and Yahoo are working on curating local content to various extents
  • Matthew Berk of Marchex: “”Local search is a solved problem for consumers but not SMBs”

8 Responses to “Recap: Kelsey Group’s Interactive Local Media Conference”

  1. Brian Hancock says at

    Hello David,

    Thanks for summarizing some key points covered at this conference. I’m in the local space as well and it sounds like this conference was more valuable than the search-focused ones I typically go to. Do you have any others you would recommend attending?

    -Brian

  2. MiriamEllis says at

    Terrific recap, David. Lots of different players and folks at this conference. It sounds like you had a really positive experience! I liked your notes on Yelp, and agree, their approach when entering a new city looks pretty good.

  3. Domenick says at

    Great summary Mr.Mihm, looks as though the information there was priceless. The review gave good insight on what is happening and what could transpire, appreciate the gift. Happy Holidays all.

  4. Tom Crandall says at

    David,

    Thanks for the update. Yodle has been aggressively recruiting an SEO staff in Scottsdale (my neck of the woods) for the last couple of months. Is this part of a new product offering mentioned at the conference? How do you believe Local Listing Ads will eventually impact companies like Yodle and ReachLocal?

  5. Vedran says at

    David,

    Thanks for the recap. It was very informative. But the last line stuck with me.
    “”Local search is a solved problem for consumers but not SMBs”

    How true is that ?

    The market expects too much from SMBs.

  6. Mike Ramsey says at

    You have a lot of information to digest here. Thanks for the recap, between this and Andrew’s posts I practically felt like I was in LA myself.

    I, like Miriam, find it interesting that Yelp has such a bad connotation with businesses owners. When you look at the business owner facts page it is riddled with questions like. “I’m considering legal action against a reviewer and/or Yelp. What are the precedents here?”

    Not a frequently asked question I would like to be dealing with all that often.

    So, my question is… do you see Google finding themselves in this same situation with their major focus on reviews? It seems to me that business owners are ultimately scared to death of letting customers have a front page shot at them for the good or bad, and it is by far the most prominent eye candy for local listings. As the business world comes to use Google as an everyday marketing tool, I can see SMB’s not having the greatest feelings about the listings. Especially if there is delayed support for bad reviews, or review issues. It seems like Yelp is actively working to fix this problem though, will Google be close behind?

  7. David Mihm says at

    Thanks for all the comments, guys.

    @Brian, the SMX and SES shows are both great but can be expensive for solo practitioners like myself…I am obviously biased but I think our SearchFest event here in Portland should be pretty great (http://www.searchfest.org)

    @Miriam – Yeah, imagine that — actually paying people to verify the data that serves as the core of your revenue stream!

    @Tom – I think Google is probably trying to take SOME business away from those guys but there’ll still be a need for people to help SMB’s navigate the online world, both paid and organic, and by all accounts I’ve heard, Yodle does that pretty well…it’s just a matter of shrinking margins IMHO.

    @Vedran, I don’t think Berk was saying that we should “expect” more from SMBs; the inverse, in fact–that we as an industry need to do more to get SMB’s to embrace online advertising and marketing.

    @Mike – 2/3 of Yelp’s workforce is dedicated to sales/customer service. Exactly 0 members of Google’s LBC/Maps team is dedicated to this. Something’s gotta give…

  8. Mark Oliver says at

    Thanks David, interesting to hear Google sidestepping the questions of how professionals can help businesses both activate and optimise their LBC listings. Very frustrating. It would be nice for Google to recognize that we play a role. It would be handy to have a process to create LBC accounts that can be linked together so that there is a log in for for individual and a log in for the professional displaying multiple accounts similar to Analytics.

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