Tuesday, May 26, 2009

The Search for Local Search

How to Solve Local Search, Once And For All
by Matt Greitzer, Friday, May 22, 2009, 10:46 AM

There is no way to find a good plumber or electrician in New York City. I can find a plumber, any plumber, no problem. My Google query for "New York City Plumbers," for example, returned 14,700,000 results. (How is that even possible)? But finding a good plumber, one who will show up on time and provide an estimate with fewer than five digits, can't be done.

This is where I thought I would start writing about Facebook, and the opportunity has to corner the local search and services market. No one out there is doing this well -- not the major engines, not the IYPs, not even the new(er) social search and recommendation engines like FacebookYelp.

The problem with local search is not in getting accurate listings, that's easy. The challenge is in getting relevant reviews on those listings. In order to do this, you need two key ingredients.

The first is scale, as in a massive, active user base willing to inform objective business listing with subjective opinions.
The second is relevance, as in some way to ensure the reviews you are reading are not written by shills, angry ex-lovers, or crazy people.

Facebook can address both of these challenges: It has a massive user base, and it's networked, which provides all kinds of useful ways to vet the trustworthiness of a reviewer's opinion. If Facebook jumped into the local search space I believe they could corner the market. But I think Yelp has actually beaten them to it.

I was going to put Yelp in my original column as an also-ran. My original thoughts were that Yelp did not have the scale to capture this opportunity. It was in digging around on Yelp looking for examples to prove my point that I realized I'd misjudged it. Yelp does have scale. Though not nearly that of Facebook, Yelp has almost 8 million monthly unique users (according to comScore), and has doubled its user base over the last year.

Facebook should not build its own socially powered local search engine; it should just buy Yelp. This combination makes both companies better. It would instantly propel Facebook into the local search space with the backing of an active reviewer base and a proven service model. And Facebook's scale would rocket Yelp from niche to mainstream, making a good service even better by combining reviewer opinions with vetting via the social graph.

My Take

This article addresses the exact problem that led us to design YouGottaCall.

In researching our patent, it amazed us that no one had tapped into the actual value of local word-of-mouth referrals through a Web-based social network.

Our revenue model is quite different than Yelp's or Facebook's - it allows consumers to find and share the businesses trusted by their neighbors and friends. Businesses voluntarily reward their social network for referrals that result in new customers. The members' favorite charities benefit!

It is working well in our test market -I'll be glad to keep you posted on our Facebook integration and e-commerce back-end development.

One parting question - if you combine two social networks - neither of which have an intrinsic revenue model - guess what you're still missing. An intrinsic revenue model.
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