Category Archives: Research

New BIA/Kelsey Report Shows Momentum for Card-Linked Offers

BIA/Kelsey is out with my new paper on the status of card-linked offers, which is based on detailed discussions with 14 leaders of the card linking ecosystem, including credit card firms, tech vendors, payment processors, publishers and merchants. Most of the respondents are members of The CardLinx Association.

This week, I presented report highlights to The CardLinx Association’s Mobile Summit in San Mateo. Among the findings: universal agreement that card linking is seeing momentum among merchants; that some budgets for card-linked offers have begun to move from experimental to seven-figure spending; and that many key categories are participating, including Quick Service and Fast Casual restaurants, specialty retail and subscription services.

Challenges remain, however. Once seen in simple terms as a successor to the prepaid model pioneered by Groupon and Living Social, there have been some slow-downs in the business. As Coupons.com SVP Bruce Sattley noted at The CardLinx Summit, “There is not as much fervor among retailers as I would have thought a year ago.”

Clearly, the ultimate success of card-linked offers will be linked to better coordination among the various segments of the CLO ecosystem; the development of a constant stream of attractive offers; greater awareness of CLOs; the elimination of structural sales blockages; and the development of industry standards for card-linked transactions.

More information about the report, including purchase information, may be accessed here.

Craigslist’s Revenue Up 101%; Measuring Its Impact

There have been several game changers in local. One is Google search. Another is Yelp reviews. Another has got to be Craigslist.

Craigslist started out as a totally free community site focused on recruitment. In recent years, it has incrementally added paid sections – partly to make them more manageable – and it is beginning to make real money from these. According to “conservative” estimates compiled by our friends at AIM Group for its annual Craigslist report, the site’s revenues grew 101 percent in 2013 from $166.5 Million to $335.7 Million.

While Craigslist now serves 700 markets around the world, AIM Group says the vast majority of the revenue comes from 54 markets. The dollars largely come from Craigslist’s affordable fees for recruitment in 28 markets, and its auto ads, which were just introduced in 4Q 2013. AIM estimates that 79 percent of Craigslist’s revenue comes from recruitment; 16 percent comes from autos; and the remaining five percent coming from things like “therapeutic” listers in New York City. The site’s fees range from $5 to $75.

Yet, the site stays true to its roots as an altruistic community resource by not charging for “private party” person to person ads – recruitment ads are just charged to agencies and companies; and auto ads are just charged to dealers.

The question we’ve asked in the past is whether Craigslist is vulnerable. It still seems easy enough to produce a better classifieds site. eBay Classifieds – started after eBay was unable to take over Craigslist — is a much better site in terms of user experience, with links to social media, easy photo uploads, etc.

To be sure, Craigslist is — as AIM notes — “the same drab user experience” as it has always been. Under the hood, however, AIM notes that Craigslist has finally started improving the site. Suddenly, listings are mapped; there are new ways of searching for goods and services; there is a picture gallery view; and even a way to save thumbnail photos. Moreover, by imposing fees on dealer auto ads, it has become easier to find autos for sale — spam entries have been significantly cut back.

Does all this suggest that Craigslist is now poised to become a state-of-the-art site that truly serves the needs of its users as we move into the mobile age? Not necessarily. But Craigslist has probably done enough to keep its critical mass of listers, and users.

Media Execs: ‘Local’ Sales Are 7th Most Impactful Revenue Issue

Localizing ad campaigns via geo targeting and local sales is increasingly important. At BIA/Kelsey, of course, the importance of localization for digital ad sales is an article of faith.

Local Sales are not, however, part of the “A” list of impactful issues for media executives. In a poll of media executives attending Operative‘s Op/Ed 2014 event last week in Palm Desert, Local Sales ranked 7th out of 11 features that impact revenues.

It ranked as less impactful than Effectively Scaling Ad Ops; Changes in buying/RFPs; Consultative Selling; Mobile Monetization; Ineffective Technology; and Cross-platform Selling. Video Monetization; Third-party Data; Buy/Sell Automation; and Real-Time Bidding ranked lower than local.

IAB Presenation 2014_2

Local Onliner Bookshelf: Christopher Schroeder’s ‘Startup Rising ‘

Let’s just concede that Silicon Valley is the biggest hub for Web activity, and that it has some real advantages over other locales in terms of engineering and programming talent, fundraising and industry attention. But Silicon Valley’s tech-centric view –which is less oriented towards media and content smarts and culture– doesn’t always hit the bull’s eye. We certainly find a lot of talent in Seattle, Boston, Austin, New York, Washington, Chicago, Los Angeles, Atlanta and Salt Lake City.

There is also fantastic new activity in countries like the U.K., Germany, Finland, Israel and China. But can countries without a core tech center also cut it? A significant challenge is posed by the countries of the Middle East, including Turkey, Egypt, Jordan, Lebanon, The UAE, Kuwait and Saudi Arabia.

Former Washington Post. Newsweek Interactive and HealthCentral CEO Christopher Schroeder, in his powerful new book, Startup Rising, focuses on how the tech community in the Middle East has not only developed a solid infrastructure for new Web and mobile companies, but has been an important driver of democracy and social progress as well. In fact, the new generation is demanding a life and opportunities that its parents and grandparents never had (See Google’s Wael Ghonim’s leadership role in the Egyptian revolution).

Schroeder got involved in the Middle East as an adviser to several companies and as a judge for a State Department startup competition in Cairo. Prior to his direct exposure to the region, Schroeder concedes he probably held the patronizing view of the region as lacking the political and economic freedom, or the culture or technology infrastructure, to develop startups from scratch. It is not just that women aren’t allowed to drive in Saudi Arabia. It is also that the Arab culture itself seemed unable to accept failure.

But in studying the startups of The Middle East, Schroeder discovers a lot about the grit of the entrepreneurs who organically build apps based on their real day to day needs – some of them desperate (Amazon-like ecommerce sites, social nets, online education, traffic apps, event guides, restaurant review sites, investor guides) And as he points out, entrepreneurship isn’t exactly new to the Middle East – it has been going on for thousands of years, dating back to the ancient bazaars.

Ecommerce especially drives the activity here, as the region moves from a cash on demand culture. But so does mobile, in its leapfrog over the landline based telcos that have held back the countries. And so do women – many of whom — even in their hajibs and burkas, in some cases — are focused on educating the next generation, and working to develop new services.

Schroeder points out that the entrepreneurial efforts in The Middle East can be broken down into Improvisers that play off successful sites elsewhere; Problem Solvers that take over roles once reserved for government; and Global Players that can impact any market.

Developments in the Middle East, of course, are at the book’s core. But what really makes this book important to the tech community — and a worthy complement to other “startup” tomes such as David Kidder’s “Startup Playbook” — is that it strips away the hubris and conventional thinking of what has made startups successful in the U.S. Instead, it focuses on the passion and creativity, real needs of consumers, and community that really anchor next generation services.

We are proud to announce Chris Schroeder’s keynote at BIA/Kelsey’s Interactive Local Media conference Dec. 10-12 in San Francisco.

Local Onliner Bookshelf: The LMA’s ‘Innovation Mission 2013′

Sometimes there is no substitute for dropping in on industry leaders to exchange ideas and specifically, to find out how their efforts relate to yours.

That’s what our friends at The Local Media Association have been doing the last few years with their “Innovation Mission,” a tour of top companies and industry leaders that really impact their member base of small local publishers. This year’s tour was especially top-notch, with headquarters visits to Facebook, Twitter, Google, Plug and Play Tech Center, The Denver Post, The San Francisco Chronicle, The McClatchy Company, AdTaxi and Emmis Radio.

BIA/Kelsey was pleased to be part of the tour, going up to San Francisco to present our vision of verrticalization, ecommerce and transaction marketing opportunities for publishers, along with FiveStars CEO Victor Ho.

The LMA’s Nancy Lane and Pete Conti have put together an excellent report of The Tour. We all tend to live and breath this stuff, but I personally learned a lot about native advertising, digital ad agencies and Twitter ad products. In fact, the report is a field guide to the key things that small publishers (and in fact, everyone) should be thinking about in terms of their digital and mobile transition. Non-LMA members can purchase it from this link for $479.

Yelp Rolls Out Local Revenue Estimator

Primitive (and perhaps misleading) estimates on effective ROI have driven many local publishers up the wall. During Yelp‘s IPO period, one analyst suggested that it cost pizza shops almost a hundred dollars in advertising on Yelp for every pizza sold.

To combat such mistakes and show how local ad dollars are really working, Yelp has come out with a new “Estimator,” which seeks to close the loop on the value of each lead. Any merchant that has claimed a Yelp page can track leads and engagement that Yelp brings in via phonecalls made from its App , check ins, or uploaded photos.

VP of Revenue and Analytics Matt Halprin, recently recruited to Yelp from Boston Consulting Group (where he worked on similar SMB analysis, as covered by our colleague Steve Marshall), noted that SMBs are confused about the value of their Yelp advertising compared to other channels, such as circulars, coupons, display and radio.

The Estimator, which is based on actual data pulled from Yelp’s logs, will give SMBs a much better idea of Yelp’s effectiveness, he says. But it “undercounts customer leads. We can’t see calls coming from consumers who are looking at their laptop and then making phone calls. It also can’t track customer walk-ins.”

Already, the Estimator has determined that Yelp advertisers do significantly better than non-advertisers. A local business that has claimed a Yelp page sees an $8,000 annual lift from Yelp, but advertisers see a lift that is $23,000. Halprin notes that typical ad packages run about $4,000 a year, or $350 a month.

Local Onliner Bookshelf: David S. Kidder’s ‘The Startup Playbook’

The startup ethos is something that a lot of companies want to emulate: the constant drive and hustle, passion and ruthlessness of it all. We are many years from the first dot com explosion, but I still have a habit of checking corporate parking lots after dinner to see how many people are doing all-nighters.

What can we learn by talking to the “winners” in business about their startup experiences? How can we transform what we focus on, how we scale for growth — and how we work with our colleagues?

These are questions not only for the Future Stars of local media and commerce, but for all the established companies that would like to reinvigorate their dusty, musty ways. And they are the questions posed by serial entrepreneur David S. Kidder.

After raising $32.5 Million for his startup, Clickable, from the likes of Amex (and then successfully exiting with a sale to Syncapse,) Kidder says he had come to realize that he had to update his “playbook.”

Kidder’s solution: go out and talk to 50 business and philanthropic leaders about what their playbooks were for success. And failure. Among the executives were many of the tech luminaries who may have known once who have gone on to spectacular success: people like Elon Musk, of Zip2, PayPal, Tesla and Space X fame; Kevin Ryan, from DoubleClick and Gilt City; Reid Hoffman, from LinkedIn; and Steve Case, from AOL and Living Social.

The results are captured in his new bestseller, The Startup Playbook. Topics range from product development to team building and HR; from investors to culture, design, marketing, finance, crisis management and more.

“The playbook I began with simply wasn’t robust enough to capture all the extremes of taking a company from its fledging roots, when you are solving five to ten challenges at a time, to a much larger company, where you are suddenly required to juggle hundreds of problems, often instantaneously,” Kidder writes.

Kidder confirms many things that I have long suspected in this totally fascinating book. Among them: That startup people are completely irrational and self deluded; that they will do anything to keep ALL of their options open. And with the expansion of tech tools, they are the stuff of the next generation’s success. As Kidder cites blogger Chris Dixon: “Building a startup will be the homeownership of the next century.”

Kidder is customizing highlights from The Startup Playbook for his Keynote at BIA/Kelsey’s “Leading in Local: The National Impact” conference in Boston March 18-20. You can register here.