Category Archives: Research

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.

SFSW: Taking on Punch Cards with Loyalty Marketing

Loyalty and engagement programs are now flooding the local ecosystem. They see themselves as the next step up from daily deals. At the same time, they hope to be more effective than “buy 10 get one free punch cards,” according to execs from LevelUp, Swipely and Closely who were among htose who spoke at Street Fight Summit West in San Francisco.

Level Up’s John Valentine says results from his company’s loyalty program are already apparent. The discounts and loyalty points give consumers a better feeling of value, and in a review of 500 locations, have resulted in consumers paying seven percent more on average compared to regular tabs, he said.

Valentine acknowledges that the audience is self-selective. The fact that they have an iPhone suggests they’re more affluent. But it has “gone beyond the cool factor,” he says. “Using a phone for paying is becoming more normal.”

Mostly, however, Valentine says the race is on to gain a strong customer base. Level Up claims 200,000 users after just nine or ten months, and it is growing 20 percent month over month. It winds up paying $5-8 apiece for customer acquisition, he said. Even if the industry does a fast switch into NFC, and starts working more with entities such as Google Wallet, “ we don’t care,” Valentine added. “We will have a base of customers” and will be in a position of strength.

Swipely’s Angus Davis, meanwhile, suggests it is not going to be so easy getting that customer base. “Acquiring consumers is very difficult,” he says. Swipely’s approach is to build up customer loyalty, and after several months of experimentation, get them to develop restaurant specific loyalty programs.

Ultimately, it is all about fostering more repeat business for restaurants, says Davis. Sixty percent of their business comes from repeat business. Getting customer engagement and providing rich analytics will win merchant accounts over from the legacy of credit card accounts, “where bi-furcation and crust has built up.”

A different approach is being taken by Closely. CEO Perry Evans said that that the key is to give merchants “tools that get to the heart of loyalty.” Evans is especially intrigued by CardSpring, the new loyalty and promotions platform that allows consumers to opt-in to various deals and services. It puts incentives in front of consumers at a time that makes sense. “You want to give them the remote control so they can turn things on and off and decide what channel they want,” he said.

“Consumers are living their lives facedown into their phones and into their network,” said Evans. “Shopping decisions are becoming more live and based on a new combination of quality (review related) and price (putting incentive in front of consumers at time it makes sense). Give them the remote control to turn things on and off and give them a channel,” he said. That will beat Facebook. “The tools are not there. It centers only around the display ad category.”

Local Display vs. Search: Display Often Wins

Local display doesn’t get as much attention as search for SMBs, but we know that in many situations, it can complement search campaigns, or even produce better results. No one pushes harder on this than PaperG, which has developed a network of local media sites for its automated display solutions, and is now working with 20,000 SMBs. It has put together a great Infographic based on its research, coming up with some striking data.

Supporting the sense that display and search are complementary, PaperG notes that 35 percent of people who see a display ad will later search for the business. It also notes that display is cheaper on a cost per click basis that using radio or direct mail. The average CPM cost is $1.50, compared to $4.50 for radio, and $350 for direct mail.

The cost of a display ad for key verticals also runs substantially less than desktop or mobile search. Dentists, for instance, will pay a CPM of $2.58, compared to $6.13 for desktop search and $3.55 for mobile search.

“We’ve seen display work well when positioned as creating “brand awareness with performance upside,” says CEO Victor Wong in an email. “Certainly advertisers with multiple locations or that spend $1,000+ a month on print advertising benefit from greater brand awareness from online display at far cheaper costs than traditional channels. That said, we’ve now gotten targeted display to start working for single location businesses spending $500/month and with re-targeting, we can get results for as low as $100/month.”

Google Offers’ Nitin Mangtani Set to Keynote at ILM East

Here’s what we’ve been waiting to announce: Google Offers’ head Nitin Mangtani will join our great list of keynoters at ILM East March 26-28 in Boston. We believe Mangtani’s appearance marks one of the first public debuts of Google Offers, which is playing a major role in Google’s vital local strategy, along with Google Places, Google Maps and Zagat ratings and reviews.

Previously announced ILM East keynoters include Groupon Vice Chair +++ Ted Leonsis; American Express SVP of Social Media Leslie Berland; CityGrid Media CEO Jay Herratti; New York Times Research Ops VP Michael Zimbalist; and New York Magazine Digital GM Michael Silberman.

Mangtani joins Google Channel Sales BizDev Head Christine Merritt at ILM East. Merritt will provide Google’s perspective on its emergence in the local ecosystem, and the most effective way to work with Google as a partner.

The next wave of Deals is, in general, a key focus for us at ILM East, along with mobile local media, social local media, video local media, hyperlocal and locally targeted national advertising.

In addition to the keynotes from Google Offers and Groupon, we have a special Day 1 session dedicated to the next wave of deals, featuring EverSave’s Jere Doyle; Find n Save’s Christopher Tippie; Closely’s Perry Evans; and Boomtime’s Bill Bice. That session will be followed by a broader view of deals and ecommerce, which featured NextJump’s Charlie Kim; Cartera’s Jim Douglass; and’s Jaidev Shergill.

Other recent adds to the program include The Boston Globe’s Lisa DeSisto, who joins VP of Digital Products Jeff Moriarty as a presenter; and MIT Sloan Associate Professor Catherine Tucker, who gives the low down on the effectiveness of local social media.

Before the show, we’re making a special trip to The Boston Globe’s R&D Lab (Limited Space, RSVP required). Or come to Andrew Shotland’s SEO for the Enterprise session, which also features SEO Expert Will Scott and Advance Digital Media VP John Denny. We’re looking forward to a great show.

Venture Capital
•David Hornik, Principal, August Capital
•Scott Maxwell, Senior Managing Director, OpenView

Mobile Local Media
• Walt Doyle, CEO, Where
• Doug McDonald, Director, dotMobi
• John Valentine, VP, East Coast, SCVNGR/LevelUp

• Merrill Brown, Principal, MMB Media
• Josh Fenton, CEO, GoLocal24
• Zohar Yardeni, CEO, Main Street Connect

Social Local Media
• Geoff Cramer, CEO, Social Made Simple
• Adam Japko, President, Digital Sherpa
• Jeff Moriarty, VP, Digital Products,
• Mark Schmulen, GM, Social Media, Constant Contact

• Juan Delgado, Managing Director, Americas, Perform
• John McIntyre, CEO, Pixelfish
• Randa Minkarah, SVP, Revenue, Fisher Communications

Deals and Promotional Ecosystem
• Bill Bice, CEO, BoomTime
• Jere Doyle, President and CEO, EverSave
• Perry Evans, CEO, Closely
• Christopher Tippie, CEO, FindNSave

• Charlie Kim, CEO, NextJump
• Jim Douglass, EVP, Retail Advertising, Cartera Commerce
• Jaidev Shergill, CEO, Bundle

•Adam Epstein, President, AdMarketplace
•Pete Gombert,CEO, Balihoo
• Steve Sherfy, Local & Mobile Search, GroupMSearch
• Karl Siebrecht, President and CEO, AdReady

Elections 2012
• Andy Slater, VP, Digital Agency Sales, Katz 360

SMB Marketing
• Dave Galvan, President, Schedulicity
• Maria Kermath, Director, AT&T Ad Solutions
• Randy Parker, President, SMBApps
• Darren Waddell, EVP,

Sign up now (and hint: reserve your room earlier rather than later).

CitiBank/Microsoft-Backed Bundle ‘Rates’ Restaurants, Others Via Credit Card Data

Yelp reviews are susceptible to a lot of noise – relatives and friends of a business, mischief makers, people without any perspective (or taste). In fact, most review sites – Trip Advisor, Zagat, etc. — are impacted by these factors.

Some sites have tried to get around this problem by using proxies for reviews. A few years ago, for instance, Grayboxx used “mentions” of a location as a proxy for reviews, assuming that the majority of mentions would be positive ones. That method, however, proved to be inaccurate and especially dicey in smaller markets. Other sites are experimenting with the use of check- ins and Tweets as review/rating substitutes.

Now comes Bundle, a new service with seed funding from CitiBank, Microsoft and Morningstar. Bundle, which is based in New York City, has built the algorithms to clean and sort “mentions” from 20 million + Citibank credit cards. While other services work with credit card companies for loyalty programs and recommendations, we haven’t seen companies that can actually apply algorithms to aggregated, anonymized credit card data.

Bundle scores are based on the popularity of a restaurant (i.e. number of visits); the number of repeat visits by customers to a restaurant; and the amount people are willing to pay when they eat at the restaurant. One assumes scoring can easily be applied to other categories as well.

CEO Jaidev Shergill tells us that the company started 2 ½ years ago as a money management site that would analyze statements for better budgeting practices, etc. But the company changed its business model to “solve problems for people using our differentiated data asset.”

“Local search and discovery have become bigger and the importance of accurate, relevant reviews is increasingly important. However, there is no way to tell whether the review is relevant to you,” says Shergill. Credit card data, coupled with aggregated demographic and behavioral data, clears the hurdle.

The service launched last December in New York and San Francisco, and nationwide on January 1. “We have two million merchants ‘rated,’” said Shergill. “That’s as many as Yelp. It will get richer as the months go by.” He also notes that unlike review sites, Bundle doesn’t need to go market-by-market for reviews.

Shergill acknowledges some limitations to Bundle’s methodology. If there is no data, there are no ratings. So that rules out cash-only places. The data also can’t distinguish how many diners are on the check, although individual prices can be estimated based on pattern analysis. But a quick look at my zip code (“92009”) showed fairly robust, accurate results.

Bundle CEO Jaidev Shergill is speaking at ILM East March 26-28 in Boston along with Next Jump CEO Charlie Kim and Cartera SVP Jim Douglass. Register here.

Bundle CEO and Founder Jaidev Shergill