Posts Tagged ‘DMS2011’

#DMS2011: New Models for Customer Acquisition

Thursday, September 22, 2011

A telling stat this week out of the DMS meeting is that business owners are approached around 40 times each month by sales reps. The local business advertising space is becoming more crowded so this figure is only going to increase. For sales reps, it’s going to be even harder to cut through the clutter and get the ear of a business owner who wants to focus on their work. Indeed, in one of the advertiser videos shown during the conference, a business owner was given a pie by a marketing company trying to get her attention – and it worked!

Mike Centorani, VP of sales training and development, MatchCraft and Paul Plant, founder and principal, Radicle Consulting, hosted a panel to share their insights on effective models for acquiring new small business advertisers in today’s media environment.

Both Mike and Paul advocated a similar model for customer growth where sales reps are closer to their customers, more educated on their potential clients’ businesses, and can offer a diverse portfolio so they become a trusted mini ad agency. To gain credibility with small business owners and to cut through the noise, Paul and Mike offered tips for sales reps to acquire new customers:

  • Focus on the customer and their customers — not on you and your products
  • Keep in touch, offer flexibility, and prove the ROI you deliver before you deliver a bill
  • Investing the time to learn about the verticals you’re calling and visiting, to be able to ask the specific, significant questions that will engage them early on. Business owners want someone who understands their industry and if reps can explain how their solution will help drive leads, the perceived value of the advertising package will be greater than the amount you’re asking them to invest.
  • Offer creative incentives and offers..  Plant mentioned some sales reps he works with offer a “try before you buy” approach for customers where it makes sense
  • Shorter-term contracts and/or big entry-level packages

All great suggestions for reps looking to up their game.

#DMS2011: Interview with Tom Higley, Local Matters

Thursday, September 22, 2011

Tom Higley, CEO at Local Matters, a longtime player in the business of building local search platforms for publishers, provided his perspective on what’s necessary for his company – and the industry as a whole – to continue to compete in an increasingly more complicated marketplace.

Higley, who believes that Yellow Pages companies were the first develop compelling local search technology for consumers, said the industry needs to ensure that its search offerings place consumers are at the center of the innovation universe. He said that today, the Googles of the world have captured the innovation momentum in the space, and that his company and others must determine how to deal with the radically changed reality.

The key to future success, Higley said, will be to deliver something new of value to consumers that captures their attention, fosters their engagement and closes the loop between offline and online activities among consumers and businesses alike. He said an important step will be ensuring that search tools provide consumers with effective results, or they will be “almost worthless” and a failure.

Higley made clear that taking a start-up approach to innovation can and needs to be done in a way that does not put the entire company at risk. We’ll be keeping a close eye on Local Matters and its unique approach to tackling the new realities of the local search arena.

#DMS2011: Interview with Brett Truka, Groupon

Thursday, September 22, 2011

Brett Truka, regional sales manager at Groupon, provided a behind-the-scenes view of life inside the originator and largest daily deals provider. According to BIA/Kelsey, Groupon represents 58-60% of the daily deals space, which currently comprises more than 600 daily-deals providers.

Truka said that Groupon’s sales team, made up of reps ranging from backgrounds in newspapers and Yellow Pages to recent college grads, generally goes by a model ensuring 70% of reps time is spent inside the office contacting local businesses by phone, and 30% outside in the field.

Every day, Groupon needs to put out a deal in each of its markets. Truka talked about daily pipeline meetings in each regional office where Groupon managers and reps take a look at their specific market needs, and listen to where reps are in the process of securing deals with local businesses that fit those categories. Following the meeting, reps reach out to CRMs to finalize lists of businesses in those categories and then reach out to strike a deal.

BIA/Kelsey estimates that 54% of Groupon’s deals are for restaurants, something that Truka doesn’t see changing since consumers love to dine out. But he did say that Groupon is moving beyond its initial deals focused just on fun things to do locally, and branching out to local services that people need and get excited about.

Truka said that while many local businesses have heard of Groupon, most don’t know how the process works. Groupon’s reps work with business owners to structure the right kind of deal for their business, one that takes into account the volume of business and dollar discount that they can handle. Truka said that Groupon also helps manage redemption. Recentlly, the company launched iPhone and Android apps that allow merchants to scan Groupon barcodes and track redemption in an online merchant center.

BIA/Kelsey estimates that daily deals revenue will grow from $873 million in 2010 to $4.2 billion in 2015, so there is enormous opportunity for Groupon to continue to grow. But with so many competitors entering the space, it will be interesting how its future plays out.

#DMS2011: Mobile Tools for SMBs: The Starting Line

Wednesday, September 21, 2011

Michael Boland, the program director for BIA/Kelsey’s Mobile Local Media Practice, moderated a conversation today on mobile tools for local businesses, focusing on the benefits of mobile optimized websites. As we tweeted earlier today, mobile Internet users will surpass desktop users by 2015, led in large part by Smartphone penetration. Even so, it turns out only 1.25% of websites are fully mobile optimized so there’s a lot of room for sales reps to guide their clients through this space.

Small business owners, recognizing the growing importance of mobile, now have to decide if they’re going to focus their marketing dollars on mobile apps, developing mobile-friendly websites — or both.

Today’s panel all prioritized the development of a functional mobile website for small businesses. Apps are often easier for consumers to discover through sorted stores, but tend to work better for brands with a built-in audience. Most small businesses, on the other hand, are almost always found through search and mobile websites can offer them the tools that are sometimes too complex for apps.

Itai Sadan, cofounder and CEO of DudaMobile, said his company’s call widget is behind the 18% conversion across verticals because it makes it simpler for people browsing the site to connect with the local businesses. Sadan said that when consumers are searching from their mobile device, they’re not in research mode, but want to buy and connect with a business in real-time.

When it comes to apps and mobile websites, it’s clear that businesses found through mobile experience a lower bounce rate and higher client conversion than traditional websites.

#DMS2011: Joe Walsh: Planets Are Aligning for Industry Consolidation

Wednesday, September 21, 2011

Yellowbook CEO Joe Walsh kicked off today’s marathon of sessions with a look at how consolidation might stabilize Yellow Pages companies.

In an interesting and video-filled presentation, Walsh said the industry is in the beginning stages of a shakeout that will lead to consolidation across the industry.

“In the future, we’re going to have one national Yellow Pages,” Walsh said.

Walsh said that with consolidation, he’d expect to see company financials stabilize and five big benefits to the market, including:

  • Stabilized prices
  • Higher ROI to advertisers
  • Double usage of surviving products
  • Product stability and extended life
  • A business model that can survive and grow

Like the daily deals space is faced with oversupply, Yellow Pages companies face a similar situation with too many directories in many markets, according to Walsh.  This oversupply has already forced about a third of directories to exit markets, including the elimination of companion directories in many cases.

Walsh felt that despite being in a contracting environment for the print Yellow Pages business, usage of Yellow Pages is much stronger than the perception and that print directories will be around for some time to come. Walsh showed an entertaining commercial from FedEx that demonstrated the continued value of a Yellow Pages listing.

When will industry consolidation start? “I think the planets are aligning,” Walsh said.  Walsh believes many Yellow Pages companies are putting their businesses in order for this consolidation, but that the economic conditions remains one of the biggest challenges today.

Yellowbook is no stranger to change and Walsh has positioned the companies as a leader in staying ahead of industry trends. Since its founding in 1930, Yellowbook has been through many transformational periods, including closing 80 acquisitions and launching 175 new market launches.  It has been privately held and also owned by British Telecom before buying itself back.  It is now part of Yell Group.

#DMS2011: Featured Address: Bill Dinan, president, Telmetrics

Tuesday, September 20, 2011

Bill Dinan, president of Telmetrics, runs one of the leading companies in the growing call measurement space. He spoke this afternoon on key trends in the industry and where he sees call measurement heading next.

Based on the millions of calls measured by Telmetrics each month, Dinan said they are experiencing strong growth across all media channels (print, SEM/interative and mobile). Print continues to grow, but is no longer the majority of their business as it was seven years ago. Traditional performance metrics vary with each, with print traditionally measured with calls, Internet performance measured by clicks, and mobile, in his words, being “the perfect marriage of clicks plus calls.” Overall, pay-per-call programs are growing more than 200% in 2011.

A sample of the trends across media channels include:

  • Print: Performance-based advertising is increasing; transition to pay-per-call / pay-per-action remains at a measured price; and QR scans increasing to initiate calls and bridge the relationship offline.
  • SEM/interactive: Increased emphasis on measuring post-click actions and consumer engagement points; search and IYP providers leveraging technology to gain attribution
  • Mobile: Will open to a variety of new categories (i.e. gas stations and parking lots) and increase relevancy of location-based performance metrics; increased mobile QR cocktails; and complete call intelligence to determine quality as opposed to quantity (accounting for dropped calls, telemarketers, etc.).

The biggest takeaway for me was the consumer experience across media influencing call duration. Longer calls doesn’t necessarily equal a purchase, but it certainly implies high-quality leads. Based on Telmetrics research, calls through mobile leads last an average of 3.7 minutes, Yellow Pages 2..2 minutes and SEM/interactive at slightly less than 2 minutes (1.7 minutes). It makes sense for mobile since consumers are the go are probably looking to do something or book something at the point of search.

No matter what the platform, small businesses are careful where they’re spending the money and will increasingly want to see performance results. Our clients’ desire for action-based metrics will fuel the growth of mobile and greater acceptance of pay-per-call and pay-per-action pricing.

#DMS2011 Interview with Todd Rose, AT&T Interactive

Tuesday, September 20, 2011

BIA/Kelsey’s Charles Laughlin interviewed Todd Rose, VP, Business Development, AT&T Interactive, who is part of the team rolling out AT&T’s Deal of the Day offering. AT&T initially launched daily deals in three markets – Atlanta, Dallas and Los Angeles – and hopes to expand to 10 this quarter.

Rose said that the unique advantage of AT&T’s offering over pure-play competitors like Groupon and LivingSocial is its sales management infrastructure, which allows AT&T to easily roll out products nationally. He said AT&T’s challenge is not access to merchants, but to customers – something the company is trying to overcome now through e-mail, referral marketing and other efforts.

Rose described the company’s initial success in its three starter markets, which are all returning healthy margins and now have significant backlogs of deals. AT&T is currently reviewing the success of its first deals – conversion rates, etc. – which Rose said are encouraging. The company is currently using sales reps dedicated only to deals, but will test whether deals can be sold as part of a traditional rep’s comprehensive portfolio of local offerings.

Additional highlights from the conversation include:

  • According to Rose, the overall objective for deals will be to help merchants acquire and retain customers on a long-term basis.
  • AT&T has already partnered with Foursquare, and will continue to look at other partner opportunities in the deals space
  • Tier-two markets, which are less saturated with daily deal offerings, might be better entry points than larger markets, such as New York City, which has 150 daily deals sites alone
  • Deal fatigue is a real issue, that’s why AT&T is capping the number of deals per merchant. Rose said that pure-play daily deals companies max out every deal – even when it makes sense for a local merchant to do so – because it’s their only revenue stream

#DMS2011: The Future of Yellow Pages

Tuesday, September 20, 2011

BIA/Kelsey’s Neal Polachek and Charles Laughlin hosted an interesting panel on the future opportunities and challenges facing traditional Yellow Pages providers, and how these companies need to continue to transform their business models to embrace the fast-growing digital market.

David Sharman, senior vice president and chief strategy officer, Dex One, made clear that Dex One no longer sees itself as a Yellow Pages company, but a marketing solutions company providing commercially-oriented local search offerings to local businesses. Sharman said the good news about this transformation is that Dex One is positioned as a player in one of the hottest spaces in the investment market today. The bad news, he said, is that is one of the most competitive as well.

Scott Pomeroy, CEO, Yellow Pages Group, New Zealand, said his company has had debates about where the business is going and how they should embrace it. So far, he said, there is no concrete example of a business model that has been completely successful. Pomeroy said the industry needs to do a better job implementing a sustainable model. He said Yellow Pages Group is looking specifically at share of wallet – how quickly small businesses are shifting from print to digital – and working to provide the right product set to make the company credible in the marketplace.

Our own Neg Norton stressed that in today’s increasingly digital world, print Yellow Pages still provide valuable lookups. He noted that he believes that industry’s real struggle has been with sales execution.

Sharman agreed that print still has a lot more life in it and remains attractive – and that his company continues to explore creative ways to extend the medium. He said that local businesses are simply interested in ways to drive leads – so whether that comes from print or digital isn’t an issue to them. He said his company’s salespeople today help determine the combination of print and digital that makes sense for each of their customers.

The panel also spent time talking about the best business strategy for traditional Yellow Pages companies in today’s world – and the pros and cons of creating standalone digital businesses as opposed to today’s integrated print-digital businesses. Sharman said that the capital structure and cultures of the traditional Yellow Pages providers makes it difficult to build out digital offerings and attract the right workforce. Pomeroy built on that by noting that the Yellow Pages company culture was a major constraint to growth – and that publishers felt entitlement given decades of high margins and low competition. He said the industry needs to adopt a more customer-centric and fluid culture in order to be successful.

The remainder of the panel focused on other segments like mobile, and the importance of traditional Yellow Pages driving digital growth through partnerships with more specialized companies with distinct offerings as opposed to creating their own from scratch.

Blogging Live from BIA/Kelsey DMS ‘11

Tuesday, September 20, 2011

Greetings from Denver! I’m here along with my colleagues Neg Norton and Natalie Wuchenich to participate in the kickoff of BIA/Kelsey’s DMS ‘11 conference, one of the most important industry gatherings of the year.

Today through Thursday, we’ll be live-blogging exciting keynotes and panels featuring leaders from across the local search industry, including executives from AT&T Interactive, Eniro, Facebook, Local Matters, Microsoft Advertising, No Problem, Telmetrics, Yellow Pages Group and Yellowbook, among others. Additionally, this afternoon, Neg will be participating in a panel titled, “The Future of Yellow Pages,” about the near-, mid- and long-term outlook for the industry.

Check out the jam-packed DMS ’11 agenda and speakers. And keep up-to-date all week long on the latest from Denver by following us via our RSS feed, Facebook page or @LocalSearchAssn Twitter feed (hashtag #DMS2011).