Aerial Pizza
A few weeks ago, I had fun in this column commenting on the prolific use of pizza as a search term when discussing online yellow pages. I commented that you could easily walk away from most any yellow pages conference convinced that the industry was totally consumed with helping Americans locate the nearest pizzeria and obtaining the right mix of toppings.
But a recent announcement by Yellowpages.com, the yellow pages joint venture of BellSouth and AT&T really takes the cake, errr, pie. It seems yellowpages.com, with great fanfare, is introducing aerial photos along with its maps. They may not be able to tell you what a business does, but they can now show you the top of its building. If you like to select your pizzeria by type of roofing material, run don't walk to yellowpages.com. After all, if a pizzeria can't top its store properly, how can it top your pizza properly?
A cheap shot for a quick laugh? You bet. But I am also trying to make a point. Look at the big announcements by yellowpages.com since it was created: a distribution deal with AOL (more traffic); a distribution deal with Yahoo (more traffic) and still another neat and cool but not particularly useful site attraction (aerial maps).
We are pleased to announced that James Burke,Chief Marketing Officer and SVP, Global Solutions at D&Bwill be the keynote speaker at InfoCommerce 2006.Click Here for Conference Details
Too many data publishers are still caught up in this "traffic treadmill," spending ever-increasing sums to drive ever-increasing numbers of eyeballs against mediocre datasets, because advertisers value the traffic, not the content. Trouble is, users value the content, not the traffic, and you don't have a sustainable business unless you address both sides of the equation.
We've all now acknowledged that the power has shifted to the user, which means we have to serve the user with quality content. The problem with the big online yellow pages is that they are a mile wide and an inch deep. With no history of collecting, or for that matter valuing, content it's not surprising that they lean to bolt-on gimmicks like aerial photos. Trouble is, if you can affordably license content like this, so can others, so value and differentiation disappear quickly.
Here's a thought for the big online yellow pages publishers. Take the fat license fees you are paying for all these fancy site gimmicks and start calling the businesses in your database. Collect a bit more detail on what they sell and when they're open -- just the basics. Add this information to your database. Watch the increased user traffic and satisfaction that will follow. I guarantee a result you won't be able to top.
Vertical Search: The Early Years
There's been no shortage of discussion about how vertical search might provide publishers with new opportunities as well as refuge from the seemingly unstoppable incursions of the major search engines. The simple theory behind vertical search is that subject matter experts can find and organize information on specific markets better than a general search engine trying to cover everything at once. The thinking is that a vertical search engine will deliver deeper, richer and more relevant results to users. This is achieved by working harder to include relevant resources (especially those not on the open Web), and working just as hard to exclude inappropriate content. One of the most ambitious -- and impressive -- implementations of vertical search is offered by GlobalSpec, and vertical search is so integral to the company's strategy that GlobalSpec now positions itself as "The Engineering Search Engine."
Intriguingly, there are now vertical search applications coming out of the general search engines themselves. Google launched its Google Scholar vertical search application to great fanfare in 2004, providing not just a filtered view of its general search index, but also metadata pointers to enhance discovery of offline and paid access content, along with power searching features designed to meet the specific needs of academics. We also have an announcement from Microsoft of its new Windows Live Academic Search, aimed squarely at Google Scholar, and based on the Windows Live platform, which is being readied to replace the current MSN search engine. Microsoft Live Academic Search is actively encouraging publishers to contribute abstracts of paid content. Even the general search engines realize that vertical search requires rolling up your sleeves, actively looking for relevant content, both free and paid, and working tirelessly to deliver search results decidedly more comprehensive and focused than a general search engine can offer.
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But at its current state of evolution, vertical search is much more of a site attraction than a product. Vertical search is great for building site traffic. It appears to be good for building user loyalty and driving repeat visits, but for now at least it's not a money-maker. Google and Microsoft derive no revenue from their respective offerings. GlobalSpec has ingeniously woven its vertical search feature around its paid directory content, but as a stand-alone, its vertical search engine would not be a major source of revenue. Of course, it's entirely possible that vertical search engines can sell keywords just like the big search engines, but it's not clear yet what level of traffic is required to get meaningful advertiser participation, and it seems almost certain that some vertical markets will be too small to monetize vertical search in this way.
So while it seems clear to many that that vertical search is going to be big and important, the path to monetization is still murky.
From Problems to Profits
There's nothing more American than finding opportunity in adversity, and turning lemons into lemonade. This kind of creative thinking often becomes the stuff of legend and can create enormous wealth. But what if you are creating the very problem you are solving?
Two articles in Wednesday's Wall Street Journal offer examples of this phenomenon. The first dealt with recent moves by the nation's big three credit bureaus to further cash in on rapidly rising consumer interest in credit scores and reports. What's driving consumer interest in this information? Identity theft (for which the credit bureaus must assume at least some responsibility), and data processing errors by the credit bureaus that erroneously reduce people's credit scores. In short, the credit bureaus have discovered a lucrative business in letting consumers double-check their work, which is seemingly sloppy enough to warrant hundreds of millions of dollars in report sales annually.
In another article on the same day, it was reported that a growing number of guidance counselors and college test preparation services are recommending that students purchase backup scoring services to verify results of SAT tests run by the College Board. The backup scoring services, which can range from $10 to $100 on top of the $41.50 fee for taking the SAT test, are available from only one source: the College Board.
Why the sudden push to verify test results? A wave of recent bad publicity about scoring errors that wrongly lowered the test scores of thousands of students, admittedly a uncommon occurrence for the College Board. But here, too, the data provider has become, albeit inadvertently, a beneficiary of its errors.
These two examples seem like anomalies in a time when we all agree that the customer rules. What does, in fact, set these entities apart is that the information they generate and report can have a huge impact on our lives. Yet this great power over the lives and livelihoods of individuals must be matched with an equal level of responsibility to do the job properly. Certainly the College Board can be excused for isolated errors. They happen. But in the case of the credit bureaus, telling individuals in effect that data accuracy and quality control is ultimately their responsibility, and then charging them to perform it, sends absolutely the wrong message. And the perverse incentives created when errors and sloppiness can generate large amounts of revenue only works to further erode trust in these organizations.
The Pizza Paradigm
I was reading a newspaper article the other day about enhanced directory assistance services. The writer had conducted a bake-off between the various services to determine which one could most quickly, easily and dependably connect her with a pizza.
It seems the pizza paradigm is alive and well. Over the years it seems every time some new search technology is unveiled, its proof of concept is illustrated by using the example of ordering a pizza. Yellow pages conferences were particularly notorious for this. You could leave some of these conferences convinced that all of America spends its entire waking day in search of its next pizza.
Humorous? Yes. Harmless? Perhaps not. What has always bothered me about the pizza paradigm is that it's a very poor example, and when your thinking is shaped by a poor example, you overlook a lot of potential issues.The reason many cling to the pizza paradigm is because pizza is ubiquitous and commoditized. Everyone knows what a pizza is, thus freeing the new technology from the complexities of illustrating it (a real issue for mobile devices). As a commoditized product, its price doesn't vary too much, freeing the new technology from having to offer price comparisons, or worse, having to gather price information from thousands of pizzerias. As a product that isn't as heavily branded as many others, the technology is free to assume that proximity to a pizzeria matters most to consumers. This allows developers to showcase gee-whiz location technology using the dubious assumption that all consumers view all pizzerias as equally good. Pizza is also largely free of value-added content opportunities. Not too many pizzerias are rated or reviewed, so there's no need to offer this information. In short, pizza is easy.
As you can see, the pizza paradigm allows technologists and yellow pages publishers to convince themselves that cool new software can improve a poor underlying dataset. I pick on technologists and yellow pages publishers because both groups have a long history of viewing databases as a necessary evil rather than an asset. One great example of this is the many online yellow pages that offer interactive maps and detailed driving instructions. Nine times out of ten they can't tell you if the business in question has what you need, but boy can they tell you everything about how to get there!
My point is simple: always push past lowest-common-denominator, simple illustrations to determine if there is a real value-add being discussed. More times than not, you'll find you are looking at a technology in search of an application, or great technology being driven by a thin dataset. Technology by itself is rarely the whole solution to a problem in the wonderful world of content.
LoopNet Files For Initial Public Offering
LoopNet, Inc. announced that it has filed a registration statement with the Securities and Exchange Commission relating to a proposed initial public offering of its common stock. The shares in the offering will be offered by LoopNet and certain selling stockholders. The number of shares to be offered and the price range for the offering has not been determined.
Credit Suisse Securities (USA) LLC will serve as the sole book-running manager for the offering, with Thomas Weisel Partners LLC, Pacific Crest Securities Inc., and Pacific Growth Equities, LLC acting as co-managers.
LoopNet is the leading online marketplace for commercial real estate in the United States, based on the number of commercial property listings and registered members. Our online marketplace, available at www.LoopNet.com, enables commercial real estate agents, working on behalf of property owners and landlords, to list properties for sale or for lease by submitting detailed property listing information in order to find a buyer or tenant. Commercial real estate brokers, agents, buyers and tenants use the LoopNet online marketplace to search for available property listings that meet their commercial real estate criteria. By connecting the sources of commercial real estate supply and demand in an efficient manner, we believe that LoopNet enables commercial real estate participants to initiate and complete more transactions more cost-effectively than through other means. LoopNet also delivers technology and information services to commercial real estate organizations to manage their online listing presence and optimize property marketing.