This post about Mark Zuckerberg’s Sister Randi signing in Davos made me think of this SNL skit:
Randi Zuckerberg: “Don’t Make Me Sing”
Berry Co. Buys WebVisible Engineers, Assets
As previously announced (where was I?), The Berry Company has scooped up some of the assets of WebVisible, including some of its engineers. Charles Laughlin’s post discussing the acquisition was pointed out to me by several people today.
According to the release that went out:
The Berry Company, LLC today announced that it has acquired the Geneva interactive advertising platform and related intellectual property of WebVisible, Inc. The Geneva platform facilitates the development, launch, execution, measurement and administration of local advertising campaigns through an integrated suite of search engine marketing (“SEM”), bid management and other features.
The technology assets will be owned and independently operated by a newly formed, indirect subsidiary of TBC Holdings based in Playa Vista, California. Approximately 25 software development, product management and other technical staff have joined the new company, which will focus on expanding Geneva’s capabilities and supporting new and existing users of the platform.
According to Laughlin’s interview with Berry’s Eric Owen, the company got some engineers and a few others in the deal in addition to the platform. I hope that’s a good outcome for those individuals.
The Berry Company is/was a reseller of the Yodle platform — its biggest in fact. I wonder how this deal will impact the Berry-Yodle relationship?
I originally wrote about the demise of WebVisible on December 27. Since then additional details have out about internal politics, strategic missteps and a massive advertiser churn problem.
AT&T 2011 Directory Revenues: $3.3 Billion
Earlier this morning AT&T reported Q4 2011 results. I’ve written about the wireless results a bit on Internet2Go. However I always look at the spreadsheet to see how the company’s local advertising solutions are doing.
The company’s directory revenues for Q4 appear to be $781 million, down from $926 million a year ago. Total revenue for the AT&T unit for 2011 was $3.3 billion (click to enlarge the charts below):
The earnings release also describes some sort of “directory asset impairment”:
Fourth-quarter 2011 net income attributable to AT&T totaled $(6.7) billion, or $(1.12) per diluted share. Excluding significant non-cash charges of $0.65 from the actuarial loss on benefit plans and $0.48 for directory asset impairments, along with a one-time charge of $0.44 for termination of the T-Mobile USA acquisition and a one-time gain of $0.03 from a tax settlement, adjusted earnings per share was $0.42 . . . The directory asset impairment resulted from an annual review of intangible assets compared to fair value.
I’m not an accountant so I don’t have any real insight into what this means.
One question: is this 15% revenue decline a reflection of a still-weak economy and uncertainty among SMBs or does it reflect a “secular” shift away from traditional directory publishing? Remember, however, that AT&T has lots of digital solutions as well.
Update: Apparently the “directory asset impairment” was some sort of write-down based on the declining value of the directory division. I didn’t listen to the earnings call but apparently AT&T CEO Randall Stephenson said the following:
That’s one area [the directory business] that we’re going to obviously take a very hard look at, and while I don’t want to give any indication on M&A activity, it’s one of these areas that we’re going to have to decide, do we keep it, do we restructure it, as we move forward
Facebook Credits, Loyalty and Offline Sales
AllFacebook reports that Plink is going to award Facebook Credits to people who dine at designated restaurant chains. It’s pretty interesting.
Plink was designed to be user-friendly, and 100% free and easy to join; new members simply create an account through Facebook Connect, then safely and securely register the credit or debit card of their choice. Plink members then earn Facebook Credits by using their registered card when dining-out or shopping at participating restaurants and offline retailers. There are no coupons to print out, no discounts that need to be awkwardly requested or extra loyalty cards to carry; for both consumers and retailers Plink is a seamless process, with no interruption from the regular transaction process.
Facebook Credits, for those who may not be familiar with them, are a virtual currency that can be redeemed for online gaming credits (e.g., CityVille). In the Plink scenario, users register a credit card online and then must present the registered credit card participating locations — the company says there are “more than 25,000 restaurants and retail locations nationwide.” Plink then gets a cut of the transaction that it supposedly helped motivate.
For some percentage of Facebook users who normally go to these participating locations (e.g., Quiznos) and play games online this program may prove to be popular. I’m not one of them. Yet I recognize that among the 800 million Facebook users there will be many people who do fall into these two categories.
This could be a much bigger deal, however, if Facebook were to connect credits with real-world value (e.g., gift cards, products) and not just online games.
Wrapp is a company (in Sweden only right now) enabling people to send gift cards through Facebook. It’s not necessarily that far from where Facebook Credits is today to something like Wrapp. Offline behavior would then accumulate Facebook Credits that would in turn translate into real-world value.
Another idea: what if there were an online “Facebook Store,” for example, where users could buy real things (electronics, travel, services) with Facebook Credits, not unlike the airline or credit card shopping portals? That would be a radical and much more compelling scenario with far-reaching implications for Facebook, brands and the various third parties participating in the ecosystem.
ShopKick operates a Plink-like Facebook Credits program as well.
Plink’s and ShopKick’s programs are part of a relatively new movement to connect online ads or promotions to the real world. One way to describe this is: “real world analytics.” Although, that’s only a partial description because loyalty is involved in some of these cases and not just attribution.
CheckPoints, ShopKick, Bloomspot, Euclid Elements, MomentFeed, Foursquare, LocalResponse and the deal vendors, among others, can be seen in this context. NFC marketing and payments (e.g., Google Wallet) would also fall into this discussion.
Although coupons and deals (and calls to a lesser degree) have always been available to track the influence of online on local sales, these companies are doing something new and different, in very directly linking specific online promotions to offline sales and vice versa in the case of Plink.
It’s a profound development, largely enabled by smartphones, that will change both online and traditional marketing.
Related: Peter Vogel, co-founder of Plink, does believe that Facebook Credits will evolve into a real-world currency. In an article for Inside Facebook he cites some interesting examples where it’s starting to happen (e.g., movie rentals) and says the Open Graph will help drive further evolution and adoption of Facebook Credits by third parties.
ReachLocal Relaunches Site with Testimonials Aplenty
ReachLocal refreshed its site, with lots of testimonials segmented by industry.
Overall the site is an improvement vs. what was there before, which emphasized technology (platform) and the company’s ad network. This is more SMB-centric. In the same release announcing the new site, the company said that former COO Nathan Hanks is now ReachLocal president. Not sure what to make of that.
Let me know what you think of the new site and whether it’s an effective sales and educational tool.
GatheringPoint Offers Extensive Menu of Local Content for Publishers
Before the holidays I met with GatheringPoint. The company, run by Spencer Nassar, is a local data aggregator and aims to be a syndicator of enhanced content to local publishers and developers.
While there are many local business listings sources and even some offering rich content, I’m unaware of a source with the breadth of local data offered by GatheringPoint.
The company doesn’t offer the local business listings database itself. The content is complementary and sits on top of those listings. But it can also exist separate and apart from the local business database.
The company collects and organizes a fairly comprehensive list of local data feeds and sources, including:
- Deals
- Events and cultural sites
- News
- Social/check-in feeds
- Weather
- Video/images
- Environmental information/sites
They continue to add new data. The company doesn’t aspire (to my knowledge) to be a consumer destination but wants to be a data provider to others in the local segment.
The site above is a demo/showcase for its data.
Survey: 33% of Urbanites Only Use Print YP for Local Lookups
This may be very difficult for some to accept: recent survey data released by Market Authority indicate 33% of metro market consumers rely exclusively on print yellow pages for local business lookups. The data are based on 15,000 telephone interviews done in late 2011, with US adults in markets such as Chicago, Philadelphia, Austin, Boston, Atlanta and others.
Market Authority found the following about media usage for local in rural and major metro areas in the aggregate:
Metro markets:
- Print YP use only: 33%
- Both print YP and online: 40%
- Online only: 27%
In this case “online” includes IYP, search engines and sites like Yelp. It also includes (I believe) smartphone-based local lookups.
What the data above effectively mean is that more than 70% of respondents said they use print yellow pages. This finding will strike some people as implausible.
Rural markets:
- Print YP use only: 49%
- Both print YP and online: 42%
- Online only: 9%
In the rural market case over 90% are reporting current use of print YP.
If one were to look at individual markets (e.g., NYC or SF) the numbers might be different but in the aggregate they show that print YP usage (remarkably) is still quite strong. Unless you’re going to claim that these data are fabricated or rigged (which I don’t believe) they say what they say: print YP is still widely used. And the sample size is extremely large: 15,000.
In metro markets Market Authority also found that 40% of consumer-respondents had smartphones. Penetration was 27% in rural areas.
What do you think? Do you believe these data or do you have some alternative explanation for these findings?
Update: Almost nobody who commented below believes these findings or accepts them at face value. In advance of the demographic information from Market Authority, here’s some demographic usage information from a yellow pages study conducted in 2011 by Burke (on behalf of the Local Search Assn.):
Those under 34 are more likely to use search most often to find local information. Those 25-34 are more likely to use IYP most often; those over 55 use print yellow pages and other traditional media (e.g., newspapers, coupons) more often than online.
HomeDepot Buys RedBeacon
RedBeacon has announced that HomeDepot is acquiring it. The price was not disclosed. Late last year the company announced a new funding round of $7.4 million and launched an iPhone app, which I liked quite a bit.
There’s an obvious logic on both sides here and this is echoed in the expected “everything will be great going forward” statements on the RedBeacon blog:
In our opinion, The Home Depot is the perfect place for Redbeacon to achieve our vision even faster. Redbeacon and The Home Depot share many of the same core values around forward thinking, entrepreneurial spirit, excellent customer service, commitment to quality, and empowering pros and homeowners. We could not be happier to become part of The Home Depot family and to grow our team together. We want to assure all of our current users and service providers that our service will continue and will only get better!
The thing that HomeDepot brings to the table, beyond additional money, is national visibility and distribution. RedBeacon has built a worthy platform but has failed to gain much consumer traction. It recently experimented with AmazonLocal to acquire new consumer-users. RedBeacon debuted in 2009.
My guess is that consumer adoption was proving to be a very tough slog and this makes the consumer side potentially much easier. Now RedBeacon can get immediate national and local visibility in HomeDepot’s more than 2,000 stores across the US.
HomeDepot gets technology and a team. Indeed, this is a little like Wal-Mart buying Kosmix, which then became @Wal-Mart labs.
I was an early skeptic of RedBeacon but was later impressed by how the site evolved and adapted to remedy problems or imperfections in the model (such as the lack of a phone-call capability). It’s not clear to me whether RedBeacon was being shopped or whether HomeDepot approached the company.
One question that arises is: what does HomeDepot want and expect from its new Internet property? And does anyone know how much the deal was worth?
RedBeacon competitor Thumbtack recently announced a $4.5 million funding round.
Update: I just spoke to a HomeDepot spokesperson who alerted me to HomeDepot’s services channel, which connects local contractors with homeowners. I was totally ignorant of this business. She said that RedBeacon would be integrated generally with that effort but that the precise implementation of the RedBeacon assets would be worked out in 2012.
Most of my questions received a very polite, “it’s too early for us to answer that” and “we’re not talking about that.” In the latter category was the question: did you approach them or did they approach you?
Related posts:
MerchantCircle Brings Lead-Gen to Newly Redesigned Website
MerchantCircle has redesigned and relaunched its site following last-year’s $60M acquisition by lead-gen company Reply.com. In the past most of MerchantCircle’s revenue came from display and text advertising by third parties on its site.
There’s a great deal of advertising on the new site. But lead-gen has also been introduced as a central element.
Some of the pages look good — I like the home page in particular. But it’s very busy otherwise and most pages are too cluttered in my opinion. Below is a hypothetical lookup sequence for “San Francisco painters”: search/browse . . . sort . . . click . . . fill out quote form:
As an aside, you gotta love that Romney ad; that’s Google behavioral targeting in action.
Questions that arise in my mind about the new lead-gen model include:
- When people fill out the forms are the leads going to the selected merchants?
- But what if selected merchant is not among Reply’s merchant-subscriber base?
- Does the lead get diverted to someone who is?
- In the event it does not, is there an email or call that goes out to the merchant: if you want this lead do X, Y, Z . . . ?
These are questions that would apply to any lead-gen site I suppose.
Savored: Another Flavor of Daily Deals
I first became aware of Savored a couple of weeks ago after receiving and email from Mike Deluca, who indicated to me that he had joined the company. Mike was previously in charge of sales for AOL Patch. Before that he was running sales for Yodle.
Savored is a very interesting hybrid site and “evolution” of the daily deals model. Something like: Groupon meets OpenTable; it’s true “inventory management” for restaurants.
Restaurants make “inventory”available to Savored; say, a certain number of reservations between 5pm and 7pm on Tuesday and Wednesday nights, when it’s typically slow. People use their credit cards to make a reservation through Savored — paying $10 for the privilege. In the restaurant they automatically get 30% deducted from their bills without presenting a coupon, which is awkward to some people.
The restaurants give up some margin (30%) but this system is more “dignified” for everyone vs. the traditional daily deal process. Savored gets a fixed reservation fee ($10 per party), which is pretty lucrative at scale. It’s somewhat analogous to unsold ad inventory that gets dumped into secondary online ad markets/exchanges.
I was impressed by the overall quality of restaurants on the site, in contrast to sites like Restaurants.com where most places are mediocre.
The challenge here is general awareness and getting consumers to do this once. Once they do — and have a credit card on file — they’ll be inclined to use the site repeatedly.
At the other end of the spectrum, if Savored is enormously successful here might be too many people competing for too few discounted reservations. But they’d probably be happy to confront that problem.
As a final note there’s a totally closed loop here. This is like what Bloomspot is trying to do in terms of customer data and analytics, matching online to offline.
About Greg
Greg Sterling is the founding principal of Sterling Market Intelligence (SMI), a consulting and research firm focused on the Internet's influence on offline consumer purchase behavior.
