Here's my story . . .

Today a received a cold call to add a listing on Yahoo! Yellow pages (http://edit.yp.yahoo.com/). I said, hmmmm . . . tell me more :rolleyes:

He went on to mention about how search engines work ... blah blah blah ... and how local search will be the next big thing.

I told him that my business sells online at a nationwide level, so he said that his best package covered every city in the U.S. for a price over $500 and some dollars (can't remember the exact figure because I was shocked :eek: , but I think it was $550). Woooow! that beats the $299 directory listing by a good bunch green bills with B. Franklin's faces on them.

So I told him, "No way I can get an ROI for that", and I was very surprised when this guy started giving me all the facts about their averages, clickthroughs, coversions, etc. As I remember one of the first things I learned in this business from Kevin Lee's (Did-it) rule of "Don’t fool yourself with averages." SEM best practices meaning focus ROI to the detail level (Thank you Kevin!). Anyway, so I turned him off by giving him a 1% conversion rate, which (he quickly grabbed and punched-in figures in his trusty calcluator) and said, "Yea, that would probably turn out to about 2 sales per month for you and this is most likely not going to work for you then."

So, let's go back to the entire idea about local search. Here a few great articles about the topic:


Chris Sherman wrote "Will Search Engines Slay the Yellow Pages? (http://searchenginewatch.com/searchday/article.php/2239511) - July 24, 2003. And this more recent one "Google Pushes Local Search Into the Limelight (http://searchenginewatch.com/searchday/article.php/3327051) - March 17, 2004
Greg Sterling wrote "Local Search Growing, but Small Biz Advertisers Cautious (http://www.searchenginewatch.com/searchday/article.php/3316741)" - February 24, 2004
And of course, Danny Sullivan's complete collection of "Local Search Series (http://searchenginewatch.com/searchday/article.php/3111631)"
As well as many others and there is a lot of talk about it from sessions given at SES Conferences.

So, let's talk about it. Will it work? Will it be the next big thing? How will it impact SEM firms? How will it impact users and businesses? With listing fees from $25 and all the way up to over $500, will there be a true ROI or will it be one more way just to gain link popularity from directories?

Please share your views and experiences.

I got the same call this Monday. I opted out as well. Why? Well, I tried SuperPages.com and AOL Yellow Pages and I can tell you I did not get a single penny out of it. I know Yahoo is used more but after two years of paying for premium sponsorship on SuperPages and AOL Yellow Pages, and not receiving more then 3 phone calls (all ending up to be nothing), I opted out of Yahoo.

There are several types of local search, so it's tough to generalize. (Google alone has a couple of different kinds -- Google Local plus regional targeting for the Adwords program.) Clearly the category is going to be huge, but everything boils down to (a) the way the portals deploy it; (b) the way users decide to go about using it. and (c) you do need a critical mass of participating merchants to make it useful. But it will all fall into place within 2 years or so I imagine. On the horizon is local search integrated with voice-activated wireless search from, say, your car.

The sales methods, quoting unreasonable conversion rates, are not surprising to me but I do find them heavy-handed. Where will that guy be when the real numbers come in far lower than his projections? I imagine they'd think twice if they had to take personal calls on their cellphone every time an advertiser's numbers were 90% lower than those projections.

A client or two have experienced similar tactics from Yahoo on banner buys. We ran the numbers using *reasonable* CTR projections on a CPM-based offer and Yahoo's pricing on an effective CPC basis was ten times (10X) higher than we were getting elsewhere!

Local search sales tactics run the risk of becoming a boiler-room-like operation -- not just small firms or legacy yellow pages companies, but as you've obviously seen, our friend Yahoo. It's unclear that this model can be sustainable given the increasing savvy out there about measurable ROI from any type of online ad.

Confusion reigns. IMHO will be up to interactive agencies and SEM firms to guide companies through the process of being listed intelligently, and paying the right price for listings that will have an impact, and avoiding those which don't add up. For small business owners to stay on top of those shifting sands is a tall order indeed.

Will there be a true ROI? Sure, big time. There are some local businesses who are not benefitting at all from search currently. I could tell you 20-30 lines of business where a vendor might gain my business in a sea of confusion (Toronto is a big city with traffic jams so I'd rather go "very local" for some stuff) by simply taking the trouble to address me on Google Search. I would use haircuts as an example, since I moved to a new 'hood and still haven't found a good place, but for now I am growing a huge afro, so the point is moot. :afro:

I work on a very local level with a lot of small businesses -- so small that I coined the term "micro businesses" to describe them. Their budgets are so small that much of what is written about "small business" just does not apply to the micros. By micro businesses, I mean everything from the one-person consultant, to the nail salon, to the local restaurant, to the local antiques store, to the local music school, etc, etc.

Many of these micros do spend limited amounts of money on advertising. They are building websites, for a variety of reasons, and they are beginning to look for ways to raise their visibility on a local search level. Often, decent SEO is all they need, because they have a built-in geo modifier. This will get tougher however, as more sophistication moves into the area. So other online promo is necessary for these folk. My feeling is that it will be best conducted by SEM firms at the ground level, who can react to local conditions. That's why local SEM is a part of my company's offerings -- we also design sites, and host them. Different things work for different folk. A plumber may benefit from a Yahoo IYP, because people are used to looking in the Yellow Pages for a plumber. Ditto a restaurant or a carpet outlet. High-end antiques dealers, on the other hand, are not likely to do that well in the YP model, internet or print.

It is often said that more consumers are searching online for local products and services each day. I know I do. And I know the user experience often sucks -- no other word describes it! But if consumers keep coming, one of these days Google, or Yahoo, or Verizon, or someone, will get the product right, and BINGO! It's a big market out there in local land, especially when you add it all up. :cool: