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With more than 20 years of technological and entrepreneurial success, John Melideo, CEO of Jambo, has designed and brought to market a variety of products and services, and developed the necessary company infrastructure to support his inventions. Prior to starting Jambo, Melideo founded CallSource, a leading direct response advertising tracking and management company.

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A Pay-Per-Call Counterpoint: Local Search Is Trapped Under its Burdens on Merchants

Written on
May 22nd 2006
Author
by John Melideo  |
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If local search is to be the catalyst for enabling millions of smaller merchants to capitalize on online advertising, then the system must be designed to proactively reach out to the businesses — àla the hugely successful early Yellow Pages approach — rather than waiting for the businesses to find the search engines and pay-for-performance advertising providers.

If, as an industry, we employ a business model that makes it easy and hassle-free for businesses, the entire space will see enormous growth — and the benefits will be felt not only by the merchants, but by consumers, search providers and ad agencies as well.

For some specifics, I’ll use pay-per-call to illustrate what this business model should look like:

• Businesses should receive phone leads automatically — with literally no effort required on their part. When a merchant receives a call from a consumer, he or she can choose at that moment whether or not to accept the charges on a pay-per-call basis. Those charges should appear on the company’s regular phone bill. Merchants don’t pay a penny until they receive an actual phone call from a potential customer — versus paying for listings or impressions which they hope will result in calls.

• Next, search vehicles and pay-per-call providers should work together to filter search results to make them more useful for consumers. They can do this by analyzing appropriate metrics to identify the merchants most likely to be relevant to a particular consumer (factors like type of business, geography, service specialties, if it’s a residential or commercial address, among others). This refining process ultimately will deliver qualified leads of motivated consumers to merchants — enhancing the consumer experience, and the value of each phone lead.

• Listings should be organized according to which companies want phone leads and which don’t — based on the percentage of calls each merchant answers, or doesn’t. By filtering out those companies that don’t need or want the leads (companies that never accept the calls placed to them), the system will align itself for maximum efficiency.

While these suggestions relate specifically to pay-per-call, in fact every aspect of local search needs to adopt the basic principles here: that we can’t assume that the local merchants will find us; we need to proactively find them. And that we should filter, filter, filter, to ensure quality. If we start delivering quality leads before asking for their money, local search will sell itself.

For the local space to reach the next level, agencies and search providers must work together to make it easy and effective for local businesses to spend their advertising dollars online.



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Reader Comments.

“Banish ‘The Burden Model’
Advertising online is largely a do-it-yourself undertaking for local businesses. The burden is on the merchant to find online directories, navigate complicated sign-up procedures, create ads, pick keywords, manage a dynamic bidding process — with separate campaigns for each search engine and directory. Merchants often don’t have the resources or the inclination to go to such lengths, especially if they don’t yet have a website or if they’re not yet convinced of the value.”

Not entirely correct. ReachLocal.com offers an almost entirely hands-off approach for the merchant, with the service doing by far the vast majority of it form them.

Posted by John Brock (Philanthropic Media, LLC) | 1:53 pm on May 22, 2006.

For over 4 years 1-800-SAN-DIEGO has been doing just as you said in your article. The only difference is that the merchant is not billed on their exisiting phone bill. The RBOC on’t allow it. Instead the merchant is charged a fixed amount per month ($29.95) and all their calls and advertisements are paid for from this fee. We have worked hard to develop a system that takes only one community at a time and replaces the existing Yellow Pages and 411 calls to local businesses.

Keep writing those great articles

Steve Parker

Posted by steve | 7:23 pm on May 22, 2006.

The problem with local online marketing is everyone is offering services, but no one is showing local businesses how to convert prospects to customers online.

So many local businesses are getting burned because they are hiring so called professionals to build website. These people do not have a clue how to successfully convert prospects to customers. They also do not know how to cost effectively advertise online. Most have never actually marketed their own business online. There are some exceptions.

I created the Local Online Marketing Association as a vehicle for local businesses to educate themselves on techniques and strategies to market online. Whether a local business owners takes a hands-on approach or hires a “Professional” they must act for a position of knowledge.

I say to local business owners, don’t recklessly turn your online marketing over to someone else. Learn how it works and then the activities of others.

The reward will be the most cost-effective marketing available to your business.

Regards,
Fred Waters

Posted by Fred Waters | 8:14 am on May 23, 2006.

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