TellMeWhere: Europe's Foursquare?

This morning, I had the chance to sit down with Gilles Barbier, CEO and co-founder of TellMeWhere (Dismoiou in French), a Paris-based European social Yellow Pages service. As with any ratings/reviews service, people can find places (see Le Louvre profile page for example), read the basic information, see the map and pictures, rate/comment on the place, see what others have said and discover related places. So far, although well executed, it’s not very different feature-wise than a lot of ratings/reviews sites like Yelp or Qype.

Mobile as a differentiator

Where it gets really interesting is with their iPhone application (they also have an Android one). The beautifully designed (both from a user interface and user experience) app is where the rubber really hit the road for the young startup founded three years ago. Launched in July, the mobile version has been downloaded more than 400,000 times (on a total of 2 million iPhones in France).

TellMeWhere iPhone Application Home

Features include:

  • Location-based business search
  • Ability to rate/comment places and broadcast your comment on Twitter/Facebook
  • See feedback from other users and your friends
  • See recommendations based on your tastes
  • Great integration of Facebook Connect with instant account creation based on your Facebook information
  • Push of your activities to your friends’ phone and possibility for your friends to answer you back via SMS
  • Integration with Google Maps
  • Integration with the iPhone camera allowing users to take a picture and upload it right away to the place profile page

TellMeWhere iPhone Application recommendations

The release of their iPhone application has created a lot of user traction. Barbier asked me to pick a small town in France just to prove the breadth of usage. I chose Venasque, a small 1000-inhabitant village in Provence where I stayed last spring. I think there are only a dozen businesses in the village. TellMeWhere had two votes in their system. They even had a few activities in smaller towns in Canada. And now they’re on the verge of releasing version 2.0 of their mobile application of the iPhone and it will include check-in functionality (like Foursquare) and an activity stream of everything your friends are doing to enable real-time discovery. You can see a video of the new application here.

TellMeWhere iPhone Application Place Profile

Barbier shared with me that they’ve now realized their mobile applications (built in-house) have become strategic for the small 7-employee company. The combination of mobile + local + social (utilizing an existing identity system like Facebook Connect) is a winning formula.

Mobile will be disruptive

And this is where, in the future of local search, mobile wins (as opposed to the Web). I finally see the light and now realizes that mobile will probably be the great disruptor it was always supposed to be. Why? Because, as Barbier said, mobile usage is real. It’s grounded in real life, with your day-to-day local usage and your social graph. That’s how you build usage. In web-based local search, it’s all about search engine optimization (SEO) these days as it’s very expensive to build new brands. It’s traffic coming from Google and other search engines from users with little loyalty. And with the Mountain View goliath hosting more and more content on their own site, I suspect that strategy will soon go off its rails.

Real-time business model

As for TellMeWhere’s business model, they’re monetizing using “special offers”. Merchants can claim their listing and submit deals/coupons/special offers (the best way to monetize real-time local as I’ve often said). It’s a pay-per-action model (or as Barbier coined it “pay-per-visit) where merchants only pay when the user displays the coupon on their phone on location. With geo-location, it’s easy to verify if the user was really on premise or not when he displayed the coupon. Barbier told me he can charge 4 euros to restaurants each time someone uses a coupon. Sounds like a good model.

I think TellMeWhere has everything to become Europe’s Foursquare. The application is beautifully executed and is easy to use. Current usage seems to show a very positive trend. They have traction in France and other francophone countries and want to go after the rest of Europe and the English-speaking world. You should definitely check out their iPhone application if you want to see a great social/local mobile app.

Update: Gilles Barbier tells me version 2.0 of his application has been approved by Apple and is now available for download.

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Canpages Acquires Social Recommendation Site GigPark.com, Validates Praized's Model

[praized subtype=”small” pid=”58d245fd7e8f20800dee0ecd3af21f08″ type=”badge” dynamic=”true”], the second-largest directory publisher in Canada, announced Sunday night the acquisition of GigPark, a self-funded social recommendation site from Toronto, Canada. For Canpages, it’s the second local/social acquisition in two months. The first was Ziplocal in June. This acquisition is the latest in a series of “local media” technology/people acquisitions in the last few months. I noted five other ones in a blog post I wrote two weeks ago.

Interestingly enough, this is the kind of white-label enterprise technology Praized Media is proposing to directory publishers and other local media publishers worldwide. Yellow Pages Group, Canada’s largest directory publisher, is using our Answers module at answers.yellowpages.ca. We’re also currently deploying our real-time activity stream and real-time search technology within a major local portal and our technology stack has generated interest from about a dozen players in Canada, in the US and in Europe. Because of that, as co-founder of Praized Media, I was asked by a few people yesterday what I thought of this acquisition.

1) I am very happy for Pema Hegan and Noah Godfrey for this acquisition. Good work guys! I know how much work goes into building a startup. You’ll see, it’s actually fun working in the directory industry!

2) As a crystal-ball gazer, I am delighted to see directory companies fully embracing social media, even though it’s not our technology they end up using. As I’ve been writing about in the last three years, social media is key to the future of traditional local media firms. The “social” trend in the directory space is not a fad.

3) Reviews and recommendations are just the tip of the iceberg in social/local. The next evolution is “real-time”. Google is thinking about it, Twitter announced last week that they would support geo-location in their API which will allow developers to add latitude and longitude to any tweet and Facebook is bound to announce something very soon.

4) The acquisition of technology assets & people by local media publishers validate our core business model of working as technology providers to local media publishers. There is a clear need out there for our product offer and the Praized team is a world-class product & development team in the local/social technology space.

So, what to expect in the next 6 to 12 months?

1) Definitely expect more acquisitions and possibly some mergers. As Kelsey Group analyst Matt Booth said last week during a Kelsey webinar, local media publishers should try to put their hands on interesting companies and assets this year before the economy picks up again next year. The idea is to be ready with new, groundbreaking revenue-generating opportunities when good times come rolling again.

2) Also expect more rapid innovation in the space. Robert Scoble is quickly cluing in to the business potential of local recommendations in a post yesterday where he compared Facebook, Google, Twitter and Yelp. He says:

How will Facebook collect the cash? Well, go to Google and let’s do that sushi search for Boulder, Colorado again. Did you see how that list works? Facebook needs that list. Twitter isn’t even close. But what’s missing? PEOPLE! Imagine if this list, when it’s brought to you by Facebook, shows that #1 has been liked by 14 of your friends? Businesses get that for free. But what don’t they get for free? Yelp’s “offers.” Businesses PAY to “offer” things to customers to try to move up the list. So, if you’re the #3 business on the list, you might say “bring your iPhone in and you’ll get free beer.” Doing that will cost you money, both in the free beer and the advertising you’ll pay Facebook or Google or Yelp to try to move up the list. Google has the list. It doesn’t have the humans or the offers. Yelp has the offers but doesn’t have hundreds of millions of people. Facebook has hundreds of millions of people and the “like” system, but not the offers. So, who will get there first? Now you understand the battlefield. Who will win the war?

But he forgets that Yelp’s “offers” don’t scale. Yelp doesn’t have the “offers”. They don’t have a large enough sales force to make it a billion dollar business. It’s Yellow Pages, newspapers, coupon and other local media publishers that own the sales force. But then, like Google, local media publishers don’t have the social elements and interactions. It will be a natural one-two punch for any large company that assembles merchants (i.e. advertising) and consumers meshed in social interaction. I’m willing to bet this will come from directory companies if they move fast enough but I venture the window of opportunity is approximately 12 months before Facebook, Twitter or even Google crack the social local nut.

Update: Greg Sterling analyzes the transaction.

Canpages Acquires Social Recommendation Site GigPark.com, Validates Praized's Model

[praized subtype=”small” pid=”58d245fd7e8f20800dee0ecd3af21f08″ type=”badge” dynamic=”true”], the second-largest directory publisher in Canada, announced Sunday night the acquisition of GigPark, a self-funded social recommendation site from Toronto, Canada. For Canpages, it’s the second local/social acquisition in two months. The first was Ziplocal in June. This acquisition is the latest in a series of “local media” technology/people acquisitions in the last few months. I noted five other ones in a blog post I wrote two weeks ago.

Interestingly enough, this is the kind of white-label enterprise technology Praized Media is proposing to directory publishers and other local media publishers worldwide. Yellow Pages Group, Canada’s largest directory publisher, is using our Answers module at answers.yellowpages.ca. We’re also currently deploying our real-time activity stream and real-time search technology within a major local portal and our technology stack has generated interest from about a dozen players in Canada, in the US and in Europe. Because of that, as co-founder of Praized Media, I was asked by a few people yesterday what I thought of this acquisition.

1) I am very happy for Pema Hegan and Noah Godfrey for this acquisition. Good work guys! I know how much work goes into building a startup. You’ll see, it’s actually fun working in the directory industry!

2) As a crystal-ball gazer, I am delighted to see directory companies fully embracing social media, even though it’s not our technology they end up using. As I’ve been writing about in the last three years, social media is key to the future of traditional local media firms. The “social” trend in the directory space is not a fad.

3) Reviews and recommendations are just the tip of the iceberg in social/local. The next evolution is “real-time”. Google is thinking about it, Twitter announced last week that they would support geo-location in their API which will allow developers to add latitude and longitude to any tweet and Facebook is bound to announce something very soon.

4) The acquisition of technology assets & people by local media publishers validate our core business model of working as technology providers to local media publishers. There is a clear need out there for our product offer and the Praized team is a world-class product & development team in the local/social technology space.

So, what to expect in the next 6 to 12 months?

1) Definitely expect more acquisitions and possibly some mergers. As Kelsey Group analyst Matt Booth said last week during a Kelsey webinar, local media publishers should try to put their hands on interesting companies and assets this year before the economy picks up again next year. The idea is to be ready with new, groundbreaking revenue-generating opportunities when good times come rolling again.

2) Also expect more rapid innovation in the space. Robert Scoble is quickly cluing in to the business potential of local recommendations in a post yesterday where he compared Facebook, Google, Twitter and Yelp. He says:

How will Facebook collect the cash? Well, go to Google and let’s do that sushi search for Boulder, Colorado again. Did you see how that list works? Facebook needs that list. Twitter isn’t even close. But what’s missing? PEOPLE! Imagine if this list, when it’s brought to you by Facebook, shows that #1 has been liked by 14 of your friends? Businesses get that for free. But what don’t they get for free? Yelp’s “offers.” Businesses PAY to “offer” things to customers to try to move up the list. So, if you’re the #3 business on the list, you might say “bring your iPhone in and you’ll get free beer.” Doing that will cost you money, both in the free beer and the advertising you’ll pay Facebook or Google or Yelp to try to move up the list. Google has the list. It doesn’t have the humans or the offers. Yelp has the offers but doesn’t have hundreds of millions of people. Facebook has hundreds of millions of people and the “like” system, but not the offers. So, who will get there first? Now you understand the battlefield. Who will win the war?

But he forgets that Yelp’s “offers” don’t scale. Yelp doesn’t have the “offers”. They don’t have a large enough sales force to make it a billion dollar business. It’s Yellow Pages, newspapers, coupon and other local media publishers that own the sales force. But then, like Google, local media publishers don’t have the social elements and interactions. It will be a natural one-two punch for any large company that assembles merchants (i.e. advertising) and consumers meshed in social interaction. I’m willing to bet this will come from directory companies if they move fast enough but I venture the window of opportunity is approximately 12 months before Facebook, Twitter or even Google crack the social local nut.

Update: Greg Sterling analyzes the transaction.

Close to 50% of Qype's Traffic Comes from Germany

Just stumbled upon this interview with Andrew Hunter, [praized subtype=”small” pid=”e05a4250d652484974e47fda5bd84b6b” type=”badge” dynamic=”true”]’s VP of Marketing (listed as UK country manager on Linkedin). The interview with Hunter starts at 3:35.

The VP says Qype is similar to [praized subtype=”small” pid=”fbc5d89826a49a78e7c8f39d86f90980f2″ type=”badge” dynamic=”true”] but that their main difference is that it’s multilingual. He says they have communities in 9 European countries plus Brazil. When asked what Qype has in common with Yelp, he says that both are strong believers in community (their main growth driver). They also have a city-by-city approach stating that cities like London, Edinburgh,  Manchester and university towns like Oxford and Cambridge love Qype immediately. He adds that their business model is similar (I discussed Qype’s and Yelp’s business model previously). Hunter says the number one benefit of Qype for users is the quality and volume of reviews.

He ends the interview by telling us Hamburg and Berlin are the largest communities on Qype, mentioning that the site has 5 million unique visitors from Germany out of 11 million total (according to their CEO, they had 9 million users in May). This is not surprising given the company was founded in Hamburg. The UK and France are the second biggest countries with 2 million unique visitors each.

Close to 50% of Qype's Traffic Comes from Germany

Just stumbled upon this interview with Andrew Hunter, [praized subtype=”small” pid=”e05a4250d652484974e47fda5bd84b6b” type=”badge” dynamic=”true”]’s VP of Marketing (listed as UK country manager on Linkedin). The interview with Hunter starts at 3:35.

The VP says Qype is similar to [praized subtype=”small” pid=”fbc5d89826a49a78e7c8f39d86f90980f2″ type=”badge” dynamic=”true”] but that their main difference is that it’s multilingual. He says they have communities in 9 European countries plus Brazil. When asked what Qype has in common with Yelp, he says that both are strong believers in community (their main growth driver). They also have a city-by-city approach stating that cities like London, Edinburgh,  Manchester and university towns like Oxford and Cambridge love Qype immediately. He adds that their business model is similar (I discussed Qype’s and Yelp’s business model previously). Hunter says the number one benefit of Qype for users is the quality and volume of reviews.

He ends the interview by telling us Hamburg and Berlin are the largest communities on Qype, mentioning that the site has 5 million unique visitors from Germany out of 11 million total (according to their CEO, they had 9 million users in May). This is not surprising given the company was founded in Hamburg. The UK and France are the second biggest countries with 2 million unique visitors each.

Why Social Media is Not Just About Merchant Reviews

Merchant review functionalities and sites are all the rage currently in the Yellow Pages industry. In the last 2 months, amongst others, we have seen:

  1. Truvo launch their own social site under the Truvo.com URL
  2. Eniro launch a beta social site under the Rejta.se URL
  3. AT&T Interactive announce the launch later this year of a social Yellow Pages site under a different brand than YellowPages.com
  4. Herold, the Austrian directory publisher, make an investment in Tupalo, a Yelp-like destination site.
  5. Canpages, the independent Canadian directory publisher, acquire assets from ZipLocal, a Canadian merchant review site.

Often called Social Yellow Pages sites, the biggest representatives of that category are Yelp (US, UK, Canada) and Qype (most of Western Europe). Both are independent, venture-funded companies. As of June 2009, more than 22 million people had visited Yelp in the past 30 days according to published internal numbers. Yelp users had written over 6 million local reviews. Qype had 9M+ unique users in May 2009 (+350% in 12 months) and 1M+ reviews.

Impressive usage numbers but an important challenge remains for these sites: monetization. For example, even though Yelp has been extremely successful from a user point of view, revenues are still low in proportion. Articles from 16 months ago mentioned Yelp’s revenues were “rumored to be sub $10 million/year” (I discussed Yelp’s monetization strategy here.)

On the other side, directory publishers, even though they’ve had for the longest-time advertiser-focused web sites, have been extremely good at generating revenues out of their web sites. For example, Yellow Pages Group (Canada) generated $C 247 million in online revenues in 2008. Over the same period, Pages Jaunes Groupe (France) achieved 471 million euros in online revenues. In the US, Yellowbook’s online revenues were up a spectacular 97.5% to $US 227 million in the last fiscal year.

Why is that? Yes, we could obviously underline the fact that these publishers represent trusted media brands, that they have large sales forces and that regular merchant contacts all play a big role in their financial success. But I would posit the moment in the consumer purchase decision process when online directories are used plays a bigger role in monetization potential.  Looking at the traditional decision process (see diagram below), online directories are clearly used when consumers are doing information search and evaluation of alternatives. Consumer reviews only happen at the end of the whole decision process, at post-purchase evaluation. Consumers will obviously look at past reviews as a proxy when doing information search but I don’t think it’s as attractive a real estate for advertisers.

buying_decision_process

Figure: Consumer Purchase Decision Process (source: Tutor2U)

I’m definitely not saying consumer reviews are useless from a strategic point of view. Consumers love to provide feedback and they love to read comments on merchants to make up their mind. I’m saying directory publishers should see reviews as one of the elements on which they build their social media strategy and one that happens at the end of the purchase cycle. It should be integrated within a more complete social media consumer purchase decision process strategy.

The filter of the consumer purchase decision process is very powerful to see who’s competing against you and to identify opportunities. Google, for instance, is clearly used by consumers when they do information search and comparing alternatives. This explains why the search giant from Mountain View is perceived as a serious threat by most directory publishers.

Enter Twitter and Facebook, the new juggernauts of the real-time conversation and real-time search world. Where do they fit in that purchase decision process? They’re definitely used for information search as well. If you search on Twitter for “Can anyone recommend” or “Looking for“, you’ll see that, every day on Twitter, thousands of people are asking for recommendations and advice. That’s why, by the way, we implemented a social media broadcast mechanism in our Praized-powered Local Answers module (used here by Yellow Pages Group in Canada) to send consumer requests to Twitter and Facebook. But I think what’s even more powerful with this new real-time conversation world is the fact that people are now actually expressing needs to the world. More than 100 people per day on Twitter say:

All these consumers are facing major life events (or know someone that are facing one) and are amazing advertiser leads for any publishers that can corral them. Consumers now want to express their needs/problems and have people/companies come to them with solutions. As I expressed in my “I have seen the future of local media” blog post, this is a new and important consumer behavior online. That’s why I believe every local media publisher will be introducing locally-relevant real-time conversation and real-time search tools within their Web sites in the next three years. That’s why I believe social media lead generation, customer and reputation management tools will become more prevalent in the next few years. That’s why publishers will introduce social ratings/reviews functionality to allow consumers to close the purchase loop after expressing needs and shopping for options. But be aware that Twitter and Facebook will certainly go after this market. This is probably the biggest opportunity directory publishers have seen since the arrival of the world wide web but it needs to be a complete strategy. Merchant reviews alone do not make a social strategy.

Yelp's Monetization Strategy

Big fracas in the local social media space today with the publication of a long anti-[praized subtype=”small” pid=”ef0b9b94446693e82f569cf40375566a” type=”badge” dynamic=”true”] article, “Yelp and the Business of Extortion 2.0”, in the East Bay Express. Jeremy Stoppelman, Yelp’s CEO, has many issue with the article and answers on the company blog. You can read Greg Sterling’s analysis on the whole situation here.

What I found interesting in the East Bay Express article is the description of the package Yelp is selling to small merchants.  According to an e-mail sales pitch that was forwarded to the journalist, advertisers receive the following:

  1. Advertisers “can highlight a favorite review to appear at the top of the page about their business.”
  2. “They also show up first in search results for similar businesses in their region (for example “coffee” near “Alameda, CA”).”
  3. “Ads for that business appear on the page of local competitors, while competitors’ ads do not appear on their page.”
  4. “Owners can post photo slideshows, add a “personal message” about their business, and have the ability to update info on special offers and events.”
  5. They also can find out how many users visit their web site, update their page, contact Yelpers who’ve reviewed their business, and have access to an account manager who will help “maximize” their experience with Yelp.”

You can see some of that info on the Business Owner section of Yelp.com.

What it means: people often ask me how you can monetize social media in a local search context.  Yelp seems to have found a combo of items that could be attractive to merchants in such a context. Ranking a review, appearing as a “related merchant”, the ability to upload additional content, and some tracking and reporting appears like an interesting social media ad bundle.  Does this package monetize as well as the traditional “advertiser ranking” model we find in many local search sites?  I don’t think so, but it’s the delicate balance between users and advertisers’ needs that Yelp is trying to maintain.  Not easy!