At the BIA/Kelsey conference yesterday, I had the opportunity to sit down with the two co-founders of SeniorChecked, Chris Spanos and Scott Knowles. Both ex-AOLers with solid experience in the local space, they’ve built this vertical local directory site targeting Seniors and their family.
Their mission is to help reduce the risk and incidence of fraud against Seniors by connecting them to trusted local businesses. Local service providers pay them $700 a year for a detailed review which eventually gets them a seal of approval from SeniorChecked. This is the list of things they investigate before approving a merchant.
Obviously a great vertical with the aging baby boomers population (Yellow Pages Group had published a print directory on the topic a few years ago) and an important life event that involves many business categories, Scott and Chris have stumbled upon a better business model than I had expected before sitting down with them. This is not a business directory play, this is a “seal of approval” play.
Why is this an important distinction? If you’re building a vertical business directory, you need to sell advertising AND convince users to come to your site. A very difficult challenge for any startup. But if you’re selling a trusted seal, advertisers will “sell” consumers to your brand. They will promote the seal in-store and in their brochures (SeniorChecked provides advertisers with a promotion package that includes stickers, logo, etc.). Consumers might eventually come back to the SeniorChecked.com site searching in the directory to make sure that the company is legit but this is not the core business. Because a seal is a simple content “atom”, it also enables SeniorChecked to distribute their approved merchants in other directory sites.
The long term picture for SeniorChecked is also very interesting. They’ve basically built a platform which enables them to launch other verticals where trust plays a big role. They want to build these verticals themselves or partner with other people, as a technology provider, to launch them.
This is not the first company to try a “seal of approval” (ValueStar comes to mind) but by verticalizing, SeniorChecked might be taking the right road to success. I’ll be following them.
The Kelsey Group organization just released the list of the keynote speakers for their next conference.
From the release, “The agenda features more than 40 influential executives from across the industry, including keynoters Jeff Berman, president of sales and marketing, MySpace; Jay Herratti, chief executive officer, Citysearch; and Chris LaSala, director of local markets, Google, as well as featured speakers Chip Perry, president and CEO, AutoTrader.com, and Chris Spanos, general manager, AOL local and search verticals.”
It will be interesting to hear from Google’s Chris LaSala to see if the recession is impacting their local ad sales or if they’re benefiting from their ROI-driven Adwords product. Also curious to hear from Jeff Berman (MySpace) to discover his thoughts on the “localization” of social networks. I also wonder if AutoTrader.com is hurting from the double whammy of the economic slowdown and the US car manufacturers meltdown or if people are doing more shopping online to get the best prices possible.
The next Kelsey Group conference “Marketplaces 2009” is in Los Angeles, March 16-18, 2009. I will be there if you’d like to meet.
On the second day of the Kelsey Drilling Down 2008 Conference, we heard from Rich Barton, Chairman and CEO, Zillow. He exposed us to his thesis that lead to the various projects he’s been involved in in the last 10 years. Before founding Zillow, Barton founded Expedia when he was at Microsoft. His basic thesis is that transparency of information is power. This leads to a consumer revolution in various verticals, releasing things that were locked-up, especially around big financial decisions. He mentioned stockbroking, travel and real estate as three verticals that were forever altered by the arrival of the Web. He also mentioned three other companies he’s involved with in the following verticals: Legal (Avvo.com), Healthcare (Realself.com), and Employment (Glassdoor.com).
He finished his presentation with a “Power to the people” manifesto that’s very telling in this user-generated content age:
- Consumer crave information and power
- If it can be known, it will be known by all (the web causes transparency)
- If it can be rated, it will be rated
- If it can be free, it will be free
- Professionals who are active players in the new vertical marketplaces win
- There can be no vertical marketplace without community
- The digital media model rules (local is giant)
“Microsoft to Pay $31 Per Share for Yahoo, Totaling $44.6 Billion in Cash and Stock. Microsoft said it sees at least $1 billion cost savings generated by the merger, and intends to offer significant retention packages to Yahoo engineers, key leaders and employees. The software giant said it believes the takeover would receive regulatory clearance and close in the second half of 2008.”
(via Yahoo Finance)
Update: just listened to the conference call. Clearly, vertical search and social media is high on the Microsoft priorities and buying Yahoo! gives them precious assets there. From a local search perspective, mobile was mentioned many times.
What it means: that rumor had been circulating for a long while now. This has the potential to create a powerhouse in local and social. More details during the conference call.
As an interesting follow-up to the Why Local is in the Zeigeist story I wrote in September, the latest TrendWatching.com briefing discusses “The Expectation Economy” and mentions a grocery store that tries to stock goods produced less than 100 miles from New York.
Urban Rustic, located in Williamsburg, NY, is a grocery store and café that aims to connect local urbanites with local farmers and producers, much like farmers’ markets do. The store primarily sells food and dry goods produced less than 100 miles from Brooklyn. Anything from farther afield is acquired from sustainable sources. Expectations being set? How about consumers developing a taste for (and demanding) anything and everything organic, eco-friendly, and local?
(Picture from the Urban Rustic web site)
What it means: I believe we will see more and more stores like this one catering to the needs of consumers who want to “shop local”. BTW, this is a great online product vertical waiting to happen. And there’s no reason why it could not be built by local newspapers or directory publishers.
Zagat Survey has launched its first ad-supported Web site for mobile devices, a platform it believes will be a primary way to serve, and advertise to, “affluent and engaged” customers. The site, Zagat.mobi, is sponsored at launch by the entertainment- and dining-themed Visa Signature credit card, which appears in clickable banner ads on the new mobile presence. Visa Signature will be the exclusive advertiser on Zagat.mobi for the first two months. (…) Mobile services player Starcut helped Zagat design the new Zagat.mobi site, which features Zagat restaurant, nightlife and hotel content for all major U.S. cities, London and other select international destinations. (…)
The mobile site differs from the company’s main Web site, ZAGAT.com and from its $30-per-year ZAGAT TO GO smartphone software (…). It is optimized for quick display on all Web-enabled mobile devices, offering free access to restaurant, nightlife and hotel information. Mobile-friendly features include links for directions, movie times, airlines and other information as well as the ability to use SMS to communicate with friends, said Zagat. Mahle said ZAGAT.com subscribers will be able to view Zagat ratings and reviews of businesses.
What it means: A couple of interesting insights on that roll-out:
- Zagat has redesigned their site specifically for mobile access. That’s a smart decision. (It’s funny how everyone uses the iPhone now to showcase their mobile site…)
- They’re promoting it using the .mobi extension. I’m still not sure .mobi domain names will catch fire but I think it can help brand recognition at this point.
- They say they’re going ad-supported but, in reality, they kept their freemium subscription model in place. You need to pay to see their trusted ratings and reviews. BTW, an interesting debate around the freemium vs. ad-supported model is happening currently.
(Via the MediaPost blog and the Kelsey Group press release)
According to The Kelsey Group’s Global Directories Forecast 2007, advertising revenues from print Yellow Pages, Internet Yellow Pages and Local Search will grow from $30.6 billion in 2006 to $38.9 billion globally in 2011, representing a 4.9 percent compound annual growth rate. The forecast expects the print Yellow Pages segment of the global directories marketplace to grow from $26.5 billion in 2006 to $27.8 billion in 2011.
Charles Laughlin, senior vice president and program director, The Kelsey Report, said “Bucking the trend of some other traditional media, the global print Yellow Pages market will grow slightly through 2011, driven by aggressive and innovative publishers.” The online segment is expected to grow from $4.1 billion in 2006 to $11.1 billion globally in 2011, a 22.3 percent compound annual growth rate.
Neal Polachek, senior vice president, The Kelsey Group “Our outlook for Internet Yellow Pages and local search is supported by our annual research of small and medium-sized business advertisers… While (small and medium-sized businesses) continue to utilize traditional media, they are increasingly turning to targeted, vertical electronic media.”
Thumbnail Summary from the Report (U.S. $):
- The global print and online directory market is expected to grow from $30.6 billion in 2006 to $38.9 billion in 2011.
- Global print revenues will be $26.5 billion in 2006 compared with $27.8 billion in 2011.
- Global online revenues will grow to $11.1 billion in 2011.
In the United States:
- Internet Yellow Pages with traditional sales channels will grow at 30.7 percent (compound) through 2011.
- Internet Yellow Page revenues will grow from $624 million in 2006 to $2.3 billion in 2011.
- Local search revenues will increase from $922 million in 2006 to $2.6 billion in 2011 .
What it means: according to the Kelsey Group, the print directory business will continue to grow in the next four years. I’m not surprised. It’s still a great business. I’m obviously biased but directory publishers have tremendous assets: sales force, usually a great brand, distribution, users and advertisers. It’s a great ecosystem! If you operate in the local search space and you brand yourself as a “Yellow Pages Killer”, you’re missing out on major opportunities to partner with these guys.