Why is there so little innovation locally?


If you were looking for "local" in the App Store, you could expect to see dozens and dozens of apps. Instead, you get some known brands: Facebook Local, Eventbrite, Nextdoor, Weatherbug, news and casual dating apps. It's kind of weird.

This is a metaphor for the declining world of the local.

Only a few sites are of importance

It was not so long ago, I made a presentation according to which local online marketing mainly concerns Google and Facebook, with a pay close attention to Yelp, Apple Maps, relevant verticals – and maybe Bing. Almost everything is indifferent or declines in importance.

This contrasts with the way a decade or so ago (several "horizontal" directories and local search engines competed). for consumer traffic. Some may not believe it, but Google was just one of the many sites that consumers could use to search for local business information (remember Yahoo Local, Mapquest, and Citysearch?). This has now radically changed.

But not only has the number of "sites that matter" changed, but there is virtually no innovative innovation for local consumers. This may seem wrong, but all the sites you would probably name are about 10 years old (or older).

Billions of dollars in spending, a declining invention

Local communications are one of the most dynamic segments of the digital economy – arguably the most important argument. Billions of dollars of offline consumer spending are influenced by online marketing and consumer ratings.

A staggering number of companies are competing for the marketing expenses of businesses and SMEs to target and influence local consumers, manage their reputation and measure the effectiveness of the media. .

But the alpha and omega of the local is now Google, where there is a frenzy of development and activity (wizard, ads, house, etc.). Then there is Facebook, which built a major local business with Marketplace . She also has groups (sometimes local ones) and has stubbornly engaged in SME marketing budgets. But Facebook has also resisted the idea of ​​creating new consumer experiences for local consumers.

Facebook trial, Yelp under pressure

In 2017, Facebook renamed its "Facebook Local" event application and I was very enthusiastic. But two years later, the company is not really promoting the application and I am not aware of anyone using it today. Nobody talks about it, ever. Even if it is used, it under-exploits its potential.

In my opinion, Yelp is the only direct and "horizontal" competitor of Google in the United States. Yelp is a public company under the pressure of some unhappy shareholders . The company is moving forward but is making only modest and incremental improvements to the user experience. And like other local giants, it was launched 15 years ago.

When it first appeared in 2004, Yelp had many competitors, which have long since disappeared (ie Citysearch, Sidewalk, Insiderpages, Judy'sBook, Tribe.net). Even once promising, Foursquare is no longer a competitor. The company has changed its B2B service model for geolocation and the consumer application is no more than a source of confidential data.

I am mystified that Foursquare is nothing more experimental for consumers. Given his new business model, he can afford to take risks and create new applications even if they get stuck and burn up. He does not need to monetize them.

And Yelp itself is now facing an existential threat from Google and the rise of GMB because of the speed and volume of review of it. According to the recent research of the social networking and social networking platform SOCi, Google seems to have more than 10 times the volume of reviews of Yelp for the same places of activity .

Nextdoor, Waze and Amazon

Nextdoor is an exception to my generalization about the lack of innovative innovation locally. He really built a local juggernaut. But the site emerged after a pivot in 2011 – eight years ago. And if you take a closer look, there is not much innovation on the site today. If possible, Nextdoor has become more cautious – perhaps tracing a path to an IPO and increasing its revenues with national or local advertising dollars.

What about Waze? He did innovative things with advertising and location . The site was launched in 2006 and acquired by Google in 2013. Yes, Waze innovated – but that's part of Google.

Several years ago, mapping-related innovation was developing, as evidenced by applications and services like Apple Maps, Bing Maps, ICI and a 3D mapping company . formerly called Recce (now known as WRLD). But that seems to be largely over, with Google Maps winning.

And Amazon? Amazon is a local dilettante. In 2005, the company developed a version of Google Street View (A9 Block View Maps) before Google Street View. He also played with the construction of local service contracts and directories. But he has never been involved at the local level and is not a key player in this area. She could certainly acquire businesses if she wanted to.

What about all sectors?

What about all sectors? Yes, there are many directories and local markets in many markets: TripAdvisor, Zillow, ZocDoc, Thumbtack, HomeAdvisor and dozens of others. But most of these sites have been around for years and most of them are not "brands".

Zillow has a relatively strong brand, but she is also 15 years old. TripAdvisor, whose brand is undoubtedly in decline, was founded in 2000. (Despite its Paleolithic UX, Craigslist remains relatively strong.)

Indeed, although there are many vertical directories, there are few of known brands. Most of these sites rely on SEO and, as the SERP evolves, they are increasingly forced to buy traffic (see HomeAdvisor-Angie'sList). Their business models are essentially a version of arbitrage.

I would say that, with a few exceptions, most of these local vertical brands weaken and no longer as Google strengthens its local offerings (for example, travel services, local services). ads) and captures more traffic. However, creating a brand is the only way to have a long-term success at the local level (and in general). If you rely on SEM and SEO for traffic and visibility, your costs will continue to increase and your brand will suffer as a result of changing the algorithm and .

Uber is also 10 years old

I know what you think: "What about food delivery and carpooling?" Food delivery has not innovated and exists for years in its own sector, despite the fact that some companies are more recent (eg DoorDash, GrubHub). Uber was founded in 2009 and was very innovative – although it would not have existed without Google Maps. But it's been 10 years now that investors are questioning its long-term prospects.

Most new local startups are SaaS companies that focus on small businesses or focus on multi-site catering, but do not reach the consumer. There is a lot of competition and activity in these areas. Why is the consumer a ghost town even though the B2B ecosystem of local businesses / SMEs is very dynamic and competitive?

I think that's because investors do not think anyone can attack Google directly and succeed. They will finance B2B companies and consumer startups in specific sectors, but it usually means bringing more efficiency or new stocks to an existing segment rather than doing something really innovative. AirBnB and WeWork are examples.

Most startups facing consumers must rely on SEO for traffic but, increasingly, is not an effective strategy and even less sustainable . Yelp has built its traffic and brand using SEO more than ten years ago.

Wanted: New Experiences, Competitors

Having a few dominant consumer destinations helps organize the world of local marketers, but it's not good for consumers – or businesses, by extension . I think there are still opportunities to create new types of local experiences for consumers (for example, Niantic Labs and AR), but challenges related to the business and competitive model are preventing investors to finance new local consumer businesses. However, it is clear that the market really needs it.


About the author

Greg Sterling is a collaborative editor at Search Engine Land. He researches and writes on the links between digital commerce and offline commerce. He is also Vice President of Strategy and Knowledge for the Local Search Association. Follow him on on Twitter or find him at the address Google+ .



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