Local Search

Google Buys Aardvark for $50 Million

After Google's failed acquisition of Yelp and on the heels of its launch of Buzz, Google has agreed to acquire "social search engine" Aardvark for $50M (per TechCrunch). A deal had been rumored for several weeks. I received confirmation also directly from the founders.

I'm a fan of Aardvark. (See the discussion of the company's distribution of queries.) It doesn't work in every situation, but it often does and when it does, it works better and more efficiently (in mobile in particular) than Google. In a vaguely ironic sort of way, this is a return to "Google Answers," a peer-to-peer paid answers service that was shut down following the rise of the free Yahoo Answers service a few years ago.

The acquisition also marks yet another -- and perhaps the most radical -- step in Google's attempted transformation from "machine" to human-powered network, or at least one partially powered by humans. 

Google will undoubtedly geocode all of the Aardvark questions/answers and push them out to Place Pages and, perhaps, Buzz (at least in mobile). Indeed, there are a range of ways that the company could integrate and utilize what is effectively a loosely knit social network of people. Among them it could push Aardvark answers into search results in the same way it indexes any content. It could also prompt people to ask a person (Aardvark) if the algo results didn't satisfy.  

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kgb Shows Super Bowl Ads, ChaCha Tracks Favs

kgb offered a couple of commercials (that I saw) last night during the Super Bowl. I enjoyed the sumo wrestler spot especially and thought it was effective. Unlike many commercials broadcast during the game the humor and content of the spot was directly tied to the brand and the service.  

This morning ChaCha put out a release that found the Doritos commercials were the favorites of the teen and young adult ChaCha user base:

ChaCha, the service that allows users to go online, call or text questions on mobile phones and receive free answers within minutes, says that a poll of its users, primarily teens and young adults, who asked questions during the Super Bowl last night showed that their favorite commercials were for Doritos. The ones they disliked most were for Go Daddy and the one most talked about, as measured by text traffic, was Denny's, mostly asking where was the nearest location of the restaurant to collect their free meal on Tuesday. Inquiries about the teams involved also skyrocketed with 60,000 (about 10x the norm) asked throughout Super Bowl Sunday.

Here's the kgb "I Surrender" commercial

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In general most of the commercials last night I thought were pretty weak. "Green police" (Audi) was another commercial I liked quite a bit. 

Mobclix Adds Nielsen Segmentation Targeting

Mobile ad exchange Mobclix announced that it would add Nielsen PRIZM and Nielsen ConneXions audience segmentation data and capabilities into the Mobclix mobile exchange. According to the release, what this enables is the following:

By bringing traditional marketing techniques to mobile advertising through Mobclix Complete, ad network partners will now enable mobile advertisers to reach over 150 unique audience segments resulting in improved conversions over legacy mobile solutions. Mobile application developers and publishers will reap the benefits of 20-100 percent CPMs higher than the market . . .

Under the terms of this agreement, Mobclix will be able to resell PRIZM and ConneXions to mobile ad networks and publishers. The anonymous user data from both PRIZM and ConneXions will then be mapped and applied to Mobclix's open marketplace platform for buying and selling mobile ad inventory. Coupled with the reach of top mobile application publishers, advertisers will benefit from this comprehensive and insightful data to help find, discover, determine, learn and better market to their audiences.

These data and capabilities move beyond simple demographics into "lifestyle" segments. 1020 Placecast uses the PRIZM data as well in its mobile targeting. 

The caveat that must be stated here is that for audience slicing and dicing to be meaningful you need massive reach, which is why allowing reselling/redistribution of these capabilities is significant. The issue of providing greater mobile reach is what makes mobile exchanges and marketplaces important. 

These Nielsen data and targeting capabilities were basically created for direct mail targeting across the US by Zip and household. However, in a mobile context, if you're looking for "hipsters" (or single moms or whatever) in a certain geography (e.g., Tribeca, New York), you start to slice the audiences too thin for most large agencies and marketers today. (The objectives of LBS or SMS marketing would be different.) Brands and agencies complain today about not being able to get enough reach with mobile in general, without adding in 150 more ways to slice up audiences. 

The fact that these data/segments were tied originally to households is paradoxical somewhat because mobile users are mostly on the go (the iPad will be a bit different). You wouldn't necessarily know who mobile users are/were except by their location and expressed behavior or "needs" (e.g., search queries). Some marketers, for example, have targeted iPhone or BlackBerry users as a proxy for certain demographic characteristics in the past.

Carriers also have this type of data about their customers and I suspect that they'll make much more of it available to marketers soon. JumpTap accesses carrier demographic information for some of its ad targeting. However, there are potential privacy issues and concerns that will be the subject of debate; but that's a much longer discussion. 

This slicing of audiences begins to be meaningful once they become larger (as they are becoming) and perhaps once you've got cross-platform buying between online and mobile, as Mobclix is starting to do with AOL's Advertising.com and Tribal Fusion-Greystripe. Then you can have an agency make a demographically targeted buy across online and mobile simultaneously. That's when this will start to shine potentially. 

There's also the branding and direct response divide; though digital obiously bridges that somewhat. A "brand" ad can have DR elements (e.g., sign up to receive alerts; find the nearest dealer, etc). The cross-platform scenario I'm describing is more likely a big brand play (with DR elements as suggested) than one aimed at getting people to take specific action now (i.e., an LBS promotion). However, a movie studio targeting a specific audience for a film could use this system quite effectively as one example.

The capabilities that these data and targeting capabilities represent are somewhat ahead of the market in my view. The market will eventually catch up but it's not yet this sophisticated.  

Is Apple Hoarding LBS Advertising?

Here's the much discussed statement from Apple to iPhone developers about location-based advertising:

The Core Location framework allows you to build applications which know where your users are and can deliver information based on their location, such as local weather, nearby restaurants, ATMs, and other location-based information.

If you build your application with features based on a user's location, make sure these features provide beneficial information. If your app uses location-based information primarily to enable mobile advertisers to deliver targeted ads based on a user's location, your app will be returned to you by the App Store Review Team for modification before it can be posted to the App Store.

Here's the prevailing interpretation of this directive:

"Looks like Apple is going to keep location-based advertising to themselves"

The speculation then proceeds that Quattro will be the sole provider of LBS ads to iPhone apps. I believe the above reading is incorrect. Instead I would argue that Apple is saying "don't just use location for ads alone":

make sure these features provide beneficial information. If your app uses location-based information primarily to enable mobile advertisers to deliver targeted ads based on a user's location, your app will be returned to you . . .

Here "beneficial information" is non-advertising content and services. At a time when Apple needs to court and retain developers it would alienate them (even more) to compell use of only Quattro advertising or otherwise preclude developers from serving LBS ads. 

Only 43 LBS Apps Offered Across Platforms

Skyhook Wireless has done a very interesting analysis that seeks to reveal how many of the thousands of location-enabled apps are available across multiple smartphone platforms. Curiously there are only 43 it turns out. According to the report:

There are nearly 6,000 iPhone location apps, 900 on Android and 300 on BlackBerry. Only 43 of these apps are available in all three stores. Of these, only six are paid. Each of these six paid apps, detailed on the next page, has a distinct per-platform price point. These apps are always significantly more expensive on Blackberry than the counterpart versions of the same paid app on iPhone and Android. For example, Wikiango is offered for free on the iPhone and for $19.99 on Blackberry.

The most fascinating aspect of this, beyond the lack of overlap, is variable pricing for the same apps. BlackBerry users are getting stuck, it would appear, with much higher prices for the same apps. Here are three "case stuides" from Skyhook showing these price differences by platform:

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As shown above, there's a $10 difference between the cost of the Zagat app on the iPhone/Android ($9.99) and BlackBerry ($19.99). Why is that? It may have to do with the demographics of the RIM user population and its legacy "enterprise user" base. Developers may simply believe they can charge more. There may be another explanation, but it's not evident.

More generally Skyhook also shows a comparison of free vs. paid apps across the three platforms. In the aggregate the iPhone has the most paid LBS apps, which is partly a function of having more apps in general:

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Free 411 Offers iPhone, Android Apps

Free DA provider Jingle Networks (800-Free-411) has launched iPhone and Android apps. They're generally useful and visually appealing but otherwise unremarkable, directory style apps. The noteworthy thing is that the company is seeking to grow volume and extend the brand through these apps. It also offers additional advertising opportunities for Jingle in mobile. 

Jingle says that it does about 15 million calls per month or 180 million per year, compared with billions of calls annually in the US directory assistance market. Jingle is arguably the best known of the "free DA" providers, followed by Google's Goog 411 service. The most complete is Bing 411, powered by Tellme.

Somewhat strangely, the public has not raced to adopt these services as once was expected (despite the money savings they offer). Lack of awareness is one factor, as is "inertia" around the number 411. Yet traditional directory assistance volumes also are in significant decline in the US. The decline of landlines and the rise of smartphones are likely also directly affecting traditional DA. Smartphones in particular make content and information available to users that far exceeds what is typically offered on a DA call.

kgb, which operates a "wholesale DA" business as well as a consumer-facing information services in the US and Europe, has reacted to the market with clever "reinventions" of the traditional offering on the iPhone (kgb answers and Knowtopia), which adds a game-like dimension to the service. The company is also doing Super Bowl advertising in an effort to further build awareness. 

VZ Navigator's Survival Depends on Facebook

Verizon just launched VZ Navigator 5.0. New and improved features include:

  • Improved Customer Experience – No need to wait for the entire route to download before starting their voyage because data will now be streamed, causing display screens to populate more quickly
  • Enhanced Points of Interest – Access to premium places of interest with detailed descriptions, clearly branded by Map Icons
  • Traffic Crowd Sourcing – Opt-in to anonymously send real-time location and speed to the VZ Navigator traffic reporting service, allowing quicker notifications and improved accuracy for all VZ Navigator users
  • Alerts for Other Road AttributesGraphic notifications for tunnels, U-turns, traffic circles and toll plazas  
  • "Say it Mode" – Select BlackBerry® smartphones and Windows Mobile® handsets allow customers to verbally search for and update destinations

The most interesting thing here is Facebook integration:

The service is now integrated with Facebook, allowing users to keep up with their friends, family and social networks by updating their Facebook statuses directly through VZ Navigator, with the option to include and share their locations.

It's this kind of value-add and expanded feature set that is key to the product's survival. Because it costs money ($9.99) and because the future of navigation is generally going to be free (see, Android 2.0 and Nokia), this product likely cannot survive absent big feature enhancements and price drops ($4.99 is probably sustainable or as part of a "bundle" with a more expensive data plan like Sprint provides). 

Putting aside the fact that there isn't an Android version available (Droid is a Verizon handset), there's no reason to purchase this if you're using a Google phone. I've been using Google Navigation and it works very well. That means the addressable market is Windows Mobile and RIM handsets. 

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That's a fair number of handsets but a thriving business it does not make. 

FourSquare's Future Emerging in Bravo Deal

Yelp adds check-ins, Facebook "is working on a Foursquare-Killer." How will the crafty location game/social net survive amid better known and more visible rivals? We're seeing how, first in a partnership with Harvard and now in a much more significant partnership with Bravo TV (owned by NBCU, in turn owned by Comcast). 

According to the NY Times' story:

Starting Monday, Bravo will begin offering Foursquare players “badges” and special prizes when viewers visit more than 500 Bravo locations. The locations will be picked by Bravo to correspond with select Bravo shows including “The Real Housewives,” “The Millionaire Matchmaker,” “Top Chef,” “Kell on Earth,” “Top Chef Masters” and “Shear Genius.”

This is the way FourSquare becomes "mainstream" (my persistent complaint/critique about the service), generates revenue and stays ahead of rivals. Forget about selling coupons to SMBs, which isn't really scalable for the startup. This is a much, much bigger opportunity. 

It's appropriate that I just wrote about QR codes and the way they extend the value of traditional media and make them more dynamic. Here's an analogous function for TV -- a way to engage viewer-users in the real world when they're not watching TV, and extend the value of the brands involved. 

Again from the Times' article: 

“We really want to tap into the power of Foursquare by engaging their audiences and bringing our Bravo viewers these unique experiences on a national level,” said Ellen Stone, Bravo’s senior vice president for marketing. Mrs. Stone said Bravo would start creating on-air TV promotions telling viewers how to play the Bravo-enhanced features of Foursquare.

This is huge for FourSquare and puts them on the path toward acquisition. Other networks and shows are probably calling Dennis Crowley right now. 

Microsoft Tag: 'Hyperlink the Real World'

CNet showcases Microsoft Tag, a nouveau QR code for traditional media publishers and products. Most QR code systems, including Microsoft Tag, require a download of software that can read the 2D barcode. On smartphones this is not the problem it once was. New market entrant JagTag doesn't require specialized software.

Microsoft Tag works with feature phones that have a camera as well. 

There are lots of companies in this 2D barcode space and lots of proprietary formats. Standardization would push the whole industry forward. Microsoft may have success with Tag because it's, well, Microsoft. Companies such as Geovector and NeoMedia have patents in this area and we'll probably see litigation eventually. 

Putting all that aside, this phenomenon of "hyperlinking the real world," is going to be massive -- capital M. Phenomena like SMS marketing and QR codes/Tag proliferation could actually move much faster than "mobile advertising" overall. Because they help measure consumer response as well as make traditional advertising more dynamic -- you can put anything you want behind a Tag including video, websites or coupons -- industry and publishers will adopt these technologies in the very near term. Indeed, they already are. 

People and most industry observers don't realize how pervasive this will be in say three years, provided that there's some standardization that helps remove uncertainty over which system to use. Consumers are already using traditional barcode readers in stores to get price and reviews information. I've both done this and witnessed this extensively (over the past Xmas shopping season). 

Imagine a code/Tag on every product, in stores on displays, on TV, in newspapers and magazines, vending machines, yellow pages directories, outdoor ads (e.g., movie posters). These codes will be absolutely everywhere. It's just a matter of time. 

As a side note, we're also likely to see 2D barcodes integrated into location gaming in the very near future . . . 

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Related: Jagtag Extends 2D Barcode System To All Major U.S. Carriers

Will FourSquare Survive Facebook's Onslaught?

Facebook is the dominant "mobile social network." We know this from Opera, Nielsen, our surveys and other third party data. We know for example that more than 70 million Facebook regularly access the site on a mobile device. No other network appears close (notwithstanding GroundTruth's assertion that MySpace is the largest mobile social network). 

Silicon Alley Insider now reports that "Facebook Is Working On A Foursquare-Killer." As a digression it's lamentable that "Fill-in-the-blank Killer" has to appear in every third technology headline. Having said that, here's the relevant part of the discussion:

A source briefed on the matter tells us Facebook is working on a feature that will allow users who access the network from mobile devices to "check-in" and broadcast their current location to all their friends.

If Facebook does add check-ins for mobile devices does it "kill" FourSquare? My answer would be "no." Facebook has a massive mobile user base, true, but FourSquare has a loyal following. Just as various Google products were launched in many instances with the moniker "X-Killer," only in a few cases has this actually turned out to be true. Navigation is one of them.

However, Google Checkout didn't kill PayPal. Google Base (now closed) didn't kill Craigslist. Knol didn't kill Wikipedia. Lively didn't kill Second Life (yes, it's still around). Okut didn't kill . . . well, it hasn't done very well outside a few isolated markets. And Facebook hasn't killed Twitter, despite becoming much more Twitter-like over the past six months. 

I had predicted that Facebook would buy FourSquare, but instead the social media site appears to be trying to adopt some of its functionality. FourSquare founder Dennis Crowley is a smart guy and understands that he has to keep ahead of his competitors with new content and features.  

Quoting Crowley on his reaction to the report, SAI reports:

For his part, Foursquare cofounder Dennis Crowley told us he fully expects Facebook and others to launch "check-in" functionality, making it "commodity by the end of the year."

Dennis says Foursquare's survival depends on providing "the most incentive for a user to check-in." Right now, Foursquare awards frequent users badges and calls the users who check-in at certain venues the most "mayor."

"I think we're doing this better than anyone else and I think we'll continue to do so. We have so much stuff on the whiteboard that we haven't even touched yet... we're really just getting started."

FourSquare's movement further into the mainstream is what could be affected by Facebook, if the latter copies FourSquare's features. However simply adding mobile check-ins alone won't truly impact FourSquare. As I've said, check-ins predate FourSquare and it's not all that FourSquare offers to its users.

Millennial Media: Portals & Directories Become Top Category by Ad Spend

Millennial Media's December/Q4 SMART report reflects some interesting trends, but mostly incredmental changes from November. The top ad spending category is now "portals and directories," which includes major Internet players (e.g., Yahoo, MSN). Travel moved up from category number 10 to number eight, as well.

Here are the highlights, as reported verbatim by Millennial:

  • The U.S. Mobile Web: Decreased slightly to 66.6M users, according to Nielsen (Nov.)
  • For the first time since S.M.A.R.T™ was first published in March ’09, Entertainment was not the top advertising vertical.  Portals and Directories took the top slot in Q4. Telecom, Finance, Entertainment and Dating round out the top 5.
  • Engagement: Average monthly page views per user increased to 125 in December from 113 in November; and, average user session times increased from 5:02 to 5:09 (min:sec).
  • Devices: Samsung represented approximately 23% of our network’s impression share in Q4. But the iPhone was the leading smart phone on our network with 41% of our network’s U.S. impressions. 

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We don't know all the specific advertisers in these categories but I would argue that at least five (maybe six) of these categories are substantially or mostly concerned with local "on their face":

  • Entertainment
  • Dating 
  • Retail/restaurants
  • Travel
  • Automotive 

Turning to handsets and OS market share, here's what Millennial is seeing on its network:

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Compare AdMob's smartphone share numbers (North America) from December:

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In both cases the iPhone is has the largest share, but on Millennial RIM is second, while AdMob's network shows Android handsets second to the iPhone. Among the top 20 mobile handsets appearing on Millennial's network, the G1 is the only Android handset reflected to date. 

Geo Most Commonly Used Targeting Feature

I was reading the Rubicon Project's Q4 market report and it cited and reminded me of a September Millennial Media mobile ad survey of "100 leading [US] agencies" and brands. The Millennial report presents a picture of increasing investment in mobile marketing but also, a lack of resources and knowledge to effectively mount mobile campaigns in some cases.

Here's an excerpt from the executive summary:

Mobile spending is expected to increase next year, with 31 percent of agency respondents stating that they will invest between $100K and $249K. More than 15 percent (15.4 percent) plan to invest more than $1 million. More than half of Q4 mobile campaigns will represent between 1 percent and 10 percent of their clients’ total spending, but, for a few, that number will be a whopping 40 percent - 50 percent. Current participation remains high with nearly ¾ of the 100 leading agencies that responded to “The State of the Industry” stating that they have developed mobile campaigns for themselves or a client. Meanwhile, 28 percent have not taken the plunge.

It's worth revisiting and showing a few of the graphs:

Targeting approaches utilized:

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Campaign objectives and success metrics:

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Barriers to mobile ad adoption: 

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Arguably this final slide is the most important, with many agencies and brands not being sure where to begin, as well as being intimidated by what they perceive as complexity (also fragmentation) in the market.

It's very curious, however, that half of the agency respondents say they have "no internal resources" to deal with mobile. Many of the big holding companies bought mobile agencies (e.g., Publicis/Phone Valley). But, beyond that, isn't it their job to deal with important emerging channels? One would think so. 

As platforms and exchanges emerge to make it easier to buy across the ecosystem or single networks with enough reach (e.g., Goog-Mob)  are established we'll see many more brands and agencies move into mobile. This year and early next, we'll see rapid advancement of mobile advertising.

Will Mobile 'Revolutionize' Local Advertising?

There's a very strong piece in AdAge about mobile trends for 2010. Here are the top-level predictions:

  1. Mobile will completely revolutionize the way local advertisers can connect with potential customers.
  2. Growth in adoption of mobile shopping applications will continue to alter in-store consumer behavior, increasing the significance of mobile in point of sale decisions making.
  3. Brands and agencies will continue to build branded apps, but will also have more attractive display media options, thanks to Google.
  4. Advertising's outdoor real estate is fast becoming another connected channel capable of delivering high-fidelity digital experiences as unique, varied and measurable as more well-established mediums.
  5. Consumers have new power to express their opinions through social technologies from anywhere, anytime. Smart marketers will do all they can to encourage and act on this real-time feedback. 

I think all these are good observations and predictions in general. However I take issue with the first prediction. Yes, from a consumer standpoint, mobile is revolutionary when it comes to obtaining local information (which includes products in my book).

Here's what the discussion of that first point in AdAge goes on to say in part:

While online display advertising has been incredibly effective for many companies, it hasn't offered all that much value to small, independently owned businesses. For one, the web is good at scale, not so good at precision. It's difficult for mom-and-pops to reach the relatively small audiences that might reasonably be expected to patronize their stores.

The article references FourSquare, Place Pages (Google) and GoWalla (but not Yelp) as a new and improved way for local advertisers to connect with customers. In isloated cases, it may be true that FourSquare is a boon to SMBs (See our related post: FourSquare Morphing into Mobile Loyalty Program for SMBs). Indeed, some advertisers might be able to find new business and improve loyalty and frequency with a FourSquare or GoWalla. But in another way these sites/companies simply add more noise to the local (SMB) advertisers' consideration set. 

I suspect the article's authors are not that familiar with local, small business advertising and are speaking at a conceptual level. They don't know that most local advertisers with any budget to spend are getting 10 calls a day before 9 am from sales reps of one sort or another. 

With an established brand, online reach (25+ million uniques), a strong mobile presence across platforms and, let's not forget, 200 telephone salespeople, Yelp is in a much stronger position than its newer mobile challengers to successfully sell to "mom and pops." 

The local world is full of clutter, noise, confusion and fragmentation. Yellow pages publishers and independent sales channels such as Yodle or ReachLocal are trying to knit all that together into a "network" or single point of contact and simplified selling proposition. Google, for its part, is almost in a unique position here (selling only its own traffic) because of its dominance of local search and huge mindshare. 

Beyond this there are lots of others selling to the local market: ValPak, daily and weekly newspapers and other specialized print publications (e.g., Pennysaver), other local coupon providers of one sort or another and others (the list goes on). Much of all this is "opaque" to the SMB owner. He or she is growing more savvy but doesn't have time to fully investigate all the options or test what works and what doesn't generally speaking. 

Most SMBs want a trusted partner that will help them navigate the complexity of online and mobile advertising. For those that want to DIY or go it alone, they're much more likely focus on a "brand" or big name: Google, Yelp, Facebook, even Twitter. It's very challenging for a little-known startup to get attention among SMB owners, let alone sell anything to them -- especially "at scale."

So while mobile and LBS on the consumer side is increasingly compelling and will lead to more connections between local buyers and sellers, local advertiers' lives are being made more difficult -- not less -- by the advent of more local-mobile players and options. 

Having said all that, I think that FourSquare has strong momentum among various segments of users and becomes a takeover target in the not too distant future by a larger player that has a stronger capacity to "monetize" the consumer traffic. 

Google’s Q4 Earnings Call Comments: Mobile

Mobile is one of the areas on Google's Q4 earnings call that received the most attention and interest during the Q&A session. Here are verbatim comments (from the transcript) about mobile. I have grouped all of a particular individual's comments together though they may have been made at different times during the call.

CEO Eric Schmidt:

Everybody knows about the success of Android, our search traffic increased 5 times in the past two years. The Droid and Nexus One show the power of the Android approach. Great devices, multiple partners, great features, [lost] for use cases. Again, a pretty clear success at this point . . .

There the most obvious one in terms of growth rate would be mobile and a lot of that depends on the competitive dynamics of the industry, how successful the new AFMA product from us is, the AdMob acquisition if that comes through. We have a lot of evidence that people are moving to these data friendly mobile devices very, very, very quickly. Our search traffic growth rate is quite a bit faster than on PCs. We expect that to continue. So for lots of reasons 2010 will be a year of significant mobile revenue growth for the whole industry. I am sure we will be able to play a major part of that.

CFO Patrick Pichette:

As we enter 2010 we are very excited about the opportunities our core business, display, mobile and apps and so you should expect us to continue to drive real investment in significant ways in the areas we believe have real long-term opportunities for Google and that will accelerate our pace of innovation.

Product SVP Jonathan Rosenberg:

Personalization is also getting more important and we think mobile is a big part of that. More users both for search and other products are accessing us from mobile devices. With all the capabilities these phones that are coming out have like GPS, cameras, we think there is the potential to actually make this mobile web better than the PC web...

[W]e are starting to see . . . that advertisers are getting better at figuring out what kind of ads work on the mobile devices. The simple addition, for example, of things like including a phone number or an offer is substantially increasing the click through rates and the ROI for the subset of advertisers who are correctly optimizing their mobile campaigns. So we are certainly seeing very strong growth there . . .

I am not going to give specifics on mobile RPMS versus desktop RPMs but I think the main thing we can say is the new formats, the targeting tools and the reporting we are giving the mobile advertisers is making the huge difference. I mentioned Click to Call putting phone numbers in the mobile ads making a difference. Try something like auto insurance on your phone and you will see that the Progressive ad on the phone actually shows the phone number while on the PC it doesn’t. Nikesh gave the Razorfish example in his opening remarks and we are also letting the advertisers target high end devices, specific devices or specific carriers and we have also launched the reporting with analytics to the mobile phones. We are starting to see much improved monetization in general across mobile.

Head of Sales Nikesh Arora:

Finally with the trends that Jonathan mentioned, the penetration of smart phones and other mobile devices our sales teams are continuing to work with advertisers who can reach and target their customers through mobile advertising like never before.

One campaign of specific note was done by Razorfish, an agency partner of ours, who used a targeted mobile campaign to improve conversion rates towards monetary retail clients by approximately 10%. So we continue to see promise in this area.

Finally, regarding Apple specifically . . .

Eric Schmidt:

With respect to Apple it is probably better to say that Apple, I as a former board member have a special spot for Apple in my heart but I will tell you Apple is a very well run company. They have a lot of very good stuff coming. We have a couple of very good partnerships with them and we also compete with them in a couple of areas. My guess is that is a pretty stable situation for awhile . . .

We are not going to speculate on the market share of Apple mobile products. That is for Apple to discuss with you. As far as I can tell our business structures with Apple are quite stable. I am not going to speculate on any deals of any kind, rumored, true, not true, you name it we are not going to talk about it.

Matching Google Nokia Ovi Maps Offer Free Navigation on Handsets

In late 2007 Nokia bought Navteq for approximately $8.1 billion (EUR 5.7 billion). But since that time the GPS/PND market that Navteq serves has seen its fortunes decline with the rise of smartphones. When Google introduced free navigation and turn-by-turn directions on Android 2.0 devices that market was further threatened. Now Nokia itself is offering free navigation (via Ovi Maps) in a bid to stop its smartphone slide vs. Apple and Google. 

Nokia sees Ovi Maps as a platform on which third parties will develop (there's an API and SDK) and which can integrate local content from various sources as well as social networks such as Facebook. In a month Ovi Maps users will be able to get content and data from Lonely Planet and Michelin.

According to the press release:

Nokia has today announced plans to release a new version of Ovi Maps for its smartphones that includes high-end walk and drive navigation at no extra cost, available for download at www.nokia.com/maps. This move has the potential to nearly double the size of the current mobile navigation market.The new version of Ovi Maps includes high-end car and pedestrian navigation features, such as turn-by-turn voice guidance for 74 countries, in 46 languages, and traffic information for more than 10 countries, as well as detailed maps for more than 180 countries.

There are also plans to eventually integrate ads onto the map. Navteq has been experimenting with advertising for over a year and last year acquired Acuity Mobile for LBS ads.

Nokia claims that its maps are more detailed, have better data and will work more often than Google's. While Google Maps requires a data connection, Nokia's do not because they're downloaded onto the handset. 

Two observations:

  • This probably does make Nokia handsets more interesting and competitive for some buyers; however it will be unlikely to stop the iPhone and Android's momentum in Europe (RIM is also growing partly at Nokia's expense outside the US.)
  • This further accelarates the decline of subscription-based navigation services and PNDs

YellowPages.com Would Benefit from iPhone-Bing Deal

BusinessWeek is reporting that Apple and Microsoft are in talks to make Bing the default search engine on the iPhone. I've discussed this at some length at Search Engine Land. Given the intensifying competition between Google and Apple, this would clearly be a case of “the enemy of my enemy is my friend.”

However, I don't think Bing will become the default. Rather I think Apple will add Bing as an option. But we'll see. 

Regardless of the scenario, a beneficiary of any such increased exposure on the iPhone and iPod Touch devices for Bing will be Microsoft's local monetization partner YellowPages.com, which is owned by AT&T.

YellowPages.com's YPMobile iPhone app has seen good uptake but the volumes of searches coming through the Safari browser default would likely be considerably larger.  

Yelp Counters FourSquare with iPhone Upgrade

Yelp originally got into mobile in a kind of "back door" way a couple years ago, with Palm building the first Yelp mobile app in Q3 2006. Since that time mobile has become more and more strategic for Yelp, with each successive app release offering richer functionality, including augmented reality.

The rise of local-mobile "game" FourSquare and to a lesser degree Gowalla has threatened to steal some of the buzz and "cool factor" that is part of Yelp's public image and appeal for younger users. Neither of these sites has many users compared to Yelp and their "nature" doesn't yet make them mainstream enough to be a true threat to Yelp, which is a much more utilitarian site and app. (Local-mobile "check ins" or friend finding don't originate with FourSquare, BrightKite, Socialight and others had this earlier.) But Yelp isn't taking chances. 

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The new release of the iPhone app offers a number of features partly responding to perceived market demand and partly intended to match FourSquare et al and prevent them from stopping Yelp's momentum in mobile. Here's the upgraded feature list of the iPhone app update:

  • Yelp Profile: Not only are you able to log into your Yelp.com profile (v.3), but now you will also be able to see and interact with your Yelp profile as you would on Yelp.com.
  • Yelp Friend Finder: You can now see and invite friends from your iPhone's address book to join you on Yelp. If you've connected with Facebook, we'll also let you know if any of your FB friends are yelping, too.
  • Yelp Check-ins: We've now added the ability for yelpers to "Check-in" to businesses. This includes being able to broadcast your whereabouts and send Quick Tips to your friends on Yelp, Facebook and Twitter who, if they opt-in to these updates, will be able to see your location both via "Push" alerts, as well as on a map. Active users of this feature may receive "Regular" status of highly-frequented businesses. This means they are part of an active group of people who patronize a business and this moniker will appear next to reviews and tips and on business pages in the app, as well as on the business listing on Yelp.com.
    Sharing via Facebook Connect and Twitter: We've taken another online feature, offline. Yelpers now have the ability to share their check-ins and Quick Tips via Facebook Connect and Twitter while on the go.
  • Updates to Monocle: In addition to seeing reviews nearby in Monocle, Yelp's Augmented Reality feature, you can also see which businesses your friend's have "checked-in" to as well as a new "map" in Monocle view that will move with you. 

There will now be a leaderboard and a new category of "Yelp Regulars," frequent visitors or patrons of local businesses. This is a broader version of the FourSquare mayor concept. According to Yelp:

"Regular" status can be achieved by frequent patronage - or checking in - of a business. This title will show up on a user's profile, next to reviews and tips and on the business page in the iPhone app, as well as eventually on that business listing on Yelp.com. The Regular with the most Check-ins will not only be featured on that business page, but get to wear the golden badge of honor. The moniker can also be lost if patronage wanes, so Regulars must visit a business often to keep it.

FourSquare is getting (or trying to get) local businesses to offer some incentive or deal (e.g., free drink, appetizer) to the "mayor," the most frequent visitor to a local business. In this way it is essentially morphing into a mobile loyalty program of sorts. Yelp is doing something similar with "Regulars" but with potentially much broader application:

Will Regulars get access to Special Offers or Exclusives? It'll be up to the business owner if they want to offer exclusives to Regulars, but it's super easy to upload a Special Offer. For almost two years now, Yelp has offered business owners the ability to post free announcements that appear on their business listing on Yelp.com and our iPhone and Android applications. In fact, businesses have posted over 200,000 special offers on Yelp to date.

On Yelp there will not simply be a single mayor but a larger category of "regulars," who might gain access to special offers, coupons and deals from local businesses. Here the pieces come together for Yelp, which has a 200-person-strong telephone sales force to promote mobile and special offers to local business owners. And the strength of the Yelp brand doesn't hurt either.  

This new version of the Yelp iPhone app sits at the nexus of social networking/mobile friend finding, LBS and mobile couponing and loyalty. 

CBS Launches Local News Apps for iPhone

CBS is smartly launching stand-alone apps for local TV affiliates (for the iPhone/iPod Touch) that complement its several national CBS News apps. According to the release, the apps will feature:

  • Local and national news (incl. sports)
  • Local weather
  • Twitter feeds
  • Video (local and national news)
  • The apps will be supported with both display and pre-roll video ads

Thirteen markets are covered:

WCBS-New York, KCBS/KCAL-Los Angeles, WBBM-Chicago, KYW-Philadelphia, WBZ-Boston, KPIX-San Francisco, KTVT-Dallas/Fort Worth, WCCO-Minneapolis/St. Paul, WFOR-Miami, KCNC-Denver, KOVR-Sacramento, KDKA-Pittsburgh and WJZ-Baltimore.

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The analogy in a local directory context would be a flagship "horizontal" app complemented by more vertical apps covering specific categories -- as AT&T has tried to do with YP Mobile and its "Have2" verticals.

The Genesis of Google's 'Near Me Now'

People are abuzz about Google's "Near Me Now" link on its mobile homepage. This was demo'd at Google's Search Evolution event several weeks ago. Many bloggers have added inflammatory headlines suggesting this is a "Yelp Killer" and the like.

First, it's not a Yelp killer and it's not new. It's really the "escalation" of something that Google's been doing for some time.

In March, 2008 Google created what it called "LCB", which experimented with a category-based browse interface. Location was manually set. A year or so later, in June 2009, Google created the Android Places Directory app. It was a much more polished version of LCB and still exists. It similarly emphasized browsing but used built-in location to avoid the need to enter that manually. 

Then in September, Google turned the "local" tab into a browse interface:

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Now this has been elevated and refined with the new "New Me Now" home page link:

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The prominece of this on the Google homepage does represent a major challenge to all the no-name local apps that have limited consumer awareness. It's not going to kill Yelp. However it could well negatively impact yellow pages app usage if those apps are not upgraded and enhanced. 

FourSquare Morphing into Mobile Loyalty Program for SMBs

TechCrunch points to a promotion on the FourSquare site that gives the "mayor" of a particular organic food restaurant in North Carolina, Blynk Organic, a free meal. One becomes mayor by being the most frequent visitor to "check in" at a venue. Here's a full list of businesses offering what amount to mobile coupons or deals to FourSquare "mayors."

One should see this as a mobile loyalty program of sorts. I still don't believe that FourSquare is mainstream but these local business promotions potentially give it much broader appeal. Nothwithstanding my "non-mainstream" remark, in some ways FourSquare represents the perfect expression of the convergence of local, social and mobile.

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