The Blue Book Adds New Website Features

The Blue Book of Building and Construction, which serves the commercial construction industry with its database of general contractors, subcontractors and suppliers, has launched a new feature on its website (www.thebluebook.com) designed to help construction professionals better manage their vendor contacts online.

The new offering, "My Blue Book," is a free application that enables registered users to customize the selection, sorting, viewing and storage of information found in The Blue Book database. Additional functionality has been included, such as the addition of "My Contacts" and "My Preferences" tabs that allow users to access their private vendor information.

This is a great idea from The Blue Book and will certainly be well-received by users. Online personalization is huge these days. Users want the features and functionality that online databases afford, but they also want to be able to manage their data in a way that meets their own personal needs. Enabling users to do just that will make them even more likely to utilize your content in the first place, make that content even more valuable, and will also motivate those users to return to your site again in the near future. Personalization can most definitely equal loyalty and retention.

Hopefully, The Blue Book isn't finished adding these personal touches to its website.

InsideView Receives Additional Financing; Looks to Expand Offerings

InsideView Inc., a Sales 2.0 application provider, has announced that it has secured $6.5 million in second round financing, which was led by current investors Emergence Capital Partners and Rembrandt Venture Partners. InsideView plans to use this latest financing to bolster its sales and marketing functions and further develop its platform.

InsideView's Sales Intelligence application, SalesView, works like this: it uncovers sales opportunities across traditional editorial sources and social media and presents them directly within a CRM application. SalesView is designed to help sales teams increase their productivity by helping them determine the right prospects to connect with at the right time.

InsideView leverages Sales 2.0 technology by aggregating and analyzing the personal, professional and corporate information that is available in social networks, websites and subscription-based sources to help users find new customer engagement opportunities. InsideView's CRM mash-ups provide sales professionals with real-time access to news alerts, relationship analysis and company information.

It's not surprising that InsideView has received this monetary support along with the confidence by its inventors that the company will continue to succeed. Regardless of the economic climate, sales and marketing professionals are under enormous pressure to succeed as well. Yet, during our current economic situation, that pressure is building.

Thus, the need for solutions such as InsideView's SalesView is undoubtedly strong and will continue to grow. The premise behind InsideView's technology is already very impressive: utilizing such online content as social networks is certainly innovative and most likely very effective for sales professionals seeking any competitive advantage they can gain. It will be very interesting to watch how InsideView uses this latest round of financing to improve the features and functionality of the SalesView solution even more.

Transparently Clear

In a settlement announced this week with the New York State Attorney General, UnitedHealth Group has agreed to shut down two databases maintained by its Ingenix subsidiary. In addition, UnitedHealth will pay $50 million to re-create the databases under the aegis of a non-profit organization to be established for the purpose.

The two Ingenix databases involved are Prevailing Health Charges System and the Medical Data Research database. The two products track "usual, customary and reasonable" physicians' fees. Most insurers use Ingenix's data, which is not available to the public or doctors, to calculate patients' out-of-pocket costs when they seek out-of-network care. Physician groups have complained bitterly about under-reimbursement driven by these databases, and consumers may have been under-reimbursed as well. This settlement does not address the claim of under-reimbursement.

In addition to the under-reimbursement claim, the New York State Attorney General also attacked the Ingenix data products for "lacking transparency." It does seem remarkable that a commercial, subscription-based data product would be obligated at all to be transparent. The New York Attorney General also charged a conflict of interest in that Ingenix is a subsidiary of a health insurer that also makes use of the Ingenix data for calculating reimbursements. Again, what's implicit in this charge is that these databases are so important that they've become bigger than the organization collecting them and become something of a public trust.

This settlement brings to mind the furor that erupted in 2006 when the First DataBank unit of Hearst Corporation was engaged in what appeared to be some very sloppy updating of its wholesale average price database for pharmaceuticals. Instead of surveying the industry to develop a true price average, it was instead gathering all its data from a single drug wholesaler. As a private, subscription data product, this would normally be just a huge embarrassment. In the case of First DataBank, however, this database was driving pharmacy reimbursement rates nationwide and reportedly led to inflated reimbursements to the tune of many billions of dollars. Here again, we have an example of a private industry database with outsized influence. While Hearst can't be claimed to have had any conflict of interest, this clearly seems to be a case were increased transparency regarding data collection practices might have prevented the problem in the first place.

Should private sector databases that are used to drive payment systems, particularly where taxpayer dollars are involved, seek to meet a higher standard of transparency? On reflection, I think the answer is "yes." Data publishers whose products fuel mission-critical applications shouldn't need to hide their work. If your work is sloppy, you have a perpetual litigation threat hanging over your head, as these two cases well illustrate. If your work is first-rate, you have a selling advantage. As to the proprietary aspects of building a database, I'm not (necessarily) suggesting that you open your algorithms to the world, since their quality can be measured based on results. Rather, I am suggesting that your data inputs and your process for creating gold from dross might benefit from some sunshine. After all, any data publishing veteran knows well that most of our value is wrapped up not in secret methodologies but rather that we sat down and did the messy work nobody else wanted to do. We aggregate, we scrub, we normalize, we purify. It's not rocket science, and there are few secrets, just skilled practitioners. In our business, transparency builds trust, and trust builds increased utilization, meaning greater revenues. Suddenly, the case for transparency seems perfectly clear.

Labels: FirstDataBank, Hearst, Ingenix, Medical Data Research, Prevailing Health Charges System, UnitedHealth Group

European Union Investigating Standard & Poor's

According to media reports, European Union regulators are investigating Standard & Poor's to determine if the credit rating agency broke monopoly abuse rules by collecting fees from banks and investment funds to use S&P's identification codes.

S&P apparently requires these financial firms to pay a fee each time they use an international securities identification number to access financial information from content service providers such as Thomson Reuters and Bloomberg. S&P manages the CUSIP Service Bureau for the American Bankers Association. It serves as the only agency to receive first-hand information from all U.S. securities issuers and licenses the data to market information services.

The EU says that investors are paying to access a database they don't use and are being charged to access a code that they need to conduct their daily business activities. The EU also says that it has received complaints that S&P is ordering information providers to cut data feed access on U.S. securities to financial institutions if they didn't pay to use the codes.

S&P has responded through the media by saying that its licensing practices and charges follow industry practices and are fair. It is likely that this investigation will continue for a while as the EU more closely examines S&P's business model to determine if the company is acting improperly. It will be interesting to see how this will be resolved and if it will lead to changes in business practices for S&P and similar information providers.

More Risk, Less Reward

I noticed in a small blurb this morning that LexisNexis had spent over $2 million on acquiring an interest in a company called RocketLawyer described as a lead generation site for lawyers. There are lots of good reasons LexisNexis might make a move like this, notwithstanding its ownership of lawyers.com, which is, surprise, a lead generation site for lawyers. This did get me thinking though that lead generation offerings are becoming ubiquitous.

We're evolving, rather quickly, from a model where advertisers purchased access to our audiences. We've spent the last several years enmeshed in a pay-per-click model, where advertisers only paid if some particular action, usually a click-through, was taken against an online advertisement. Now, the ante is rapidly being raised once again, to one where publishers are delivering screened, qualified and active prospects to advertisers.

For several years now, I've been saying that the pay- per-click model was really all about a shift in risk from advertisers to publishers. Technology and a lot of innovation by the search engines helped advertiser rapidly evolve from "you pay your money and you take your chances" to "I'm not going to pay unless something happens." Publishers were put in the position of proving that their audiences were as engaged and responsive as they had always claimed them to be. Advertising risk was being shared, like it or not.

With a business model based on sales leads, I would argue that risk may be shifting totally from the advertiser to the publisher. That's because in most sales lead models, the advertiser only pays, on a per-lead basis, for qualified leads, delivered conveniently to his doorstep while still fresh and hot. What's not to like ... if you're an advertiser?

My problem with this historic shift in advertising risk from advertiser to publisher is that as far as I can see, it's largely de-coupled from reward. In the old days, advertisers did indeed assume all the advertising risk, but at least they were allowed to keep the full benefit of the results. If a $100 advertisement yielded a $1 million order, the advertiser kept the $1 million. The publisher took no risk, but received only a small benefit. There was some balance of risk and reward.

With the sales lead model, the publisher is essentially working on spec, and effectively assuming all the advertising risk because the publisher has to invest to identify sales leads for the advertiser, and is only paid for results. If a sales lead developed by the publisher yields a $1 million order however, it is the advertiser who keeps the $1 million, paying the publisher a flat fee only if and when a lead is delivered. In short, risk and reward are anything but fairly balanced.

Perhaps most significantly, it seems clear to me we're on a slippery slope with advertisers who are finding they can ask for increasingly unreasonable performance on increasingly unreasonable terms and publishers will deliver. While it may seem laughable, the next logical step in this evolution is for advertisers to decide they only want to pay when a lead turns into a sale. Even if the publisher were to share meaningfully in the sale revenue this really puts a publisher's success in the hands of strangers. Do you really want your revenue to depend on whether or not the owner's brother-in-law at one of your advertisers is a skilled salesperson or not?
I'd suggest that before the lead generation business spirals totally out of control, publishers should take a breath and think about their revenue models. It's great if you can get, say, $200 for a qualified lead. But if you can truly deliver qualified leads to your advertisers, you're worth a lot more. Further, it's not sensible or good business to get your advertisers used to a risk-free business relationship. Perhaps adding a monthly "program participation fee" on top of per-lead fees is a way to re-balance risk and reward while reminding advertisers that there is no free lunch.

Labels: lawyers.com, lexisnexis, rocketlwayer.com