Issues with Local Business Centers

Checking out the “local” blogs buzz this week, I noticed a number of blogs reporting about Google Local Business Center issues and why it’s a failure. In his post, Mike says:

Google needs to understand that Local is different than Search, that accuracy is more important than relevance, and they need to embrace the business listing side of Maps if for no other reason than these folks are the future growth of Adwords. If it takes charging a monthly fee to have the resources to service this side of the business then so be it.

I agree in principle that the companies like Google and my ex-employer should strive to provide a better service (and any company for that matter :), but I’m not so sure about charging local businesses for that service. The problem that Mike is pointing out with Google is just a tip of the iceberg. The problem with local listing sites and pain that a small business owners feel as a result is much deeper and bigger. Why do I say that?

An online listing of a small business is an important identity that the small business owners deeply care about. They not only want to make sure they can be discovered online, but they also want to make sure that the listing information is accurate. Sounds reasonable? Ok, then to achieve that where do they need to go today? Google? Microsoft? Yahoo? Ask? YellowPages? Yelp? Localeze? Merchant Circle? Center’d? Or InfoUSA? All of them?

You see the issue? The issue is that the local directories are fragmented and the small business owners are already spending tons of time online to make sure their information is accurately presented on each and every site (at Center’d we do get a number of emails every single day from SMBs asking either to be listed or to correct the listing) – that is a huge distraction from running their business offline. Now if all these sites start charging them for having a basic listing and keeping it accurate – it’s going to be a huge money sink as well. I’m not against charging small business owners for promoting their business once it is listed and accurate – but having an accurate listing is almost a right that they have and all the websites that do list these owe it to their owne users aswell – after all you don’t want to give a wrong phone number or a wrong address when someone searches on your site.

So what do we really need to help small business owners? We need a federated service that let’s a small business owner to create and control their identity online – then this service pings all the directories (that are registered to get updates) about the updates. Then each directory must sync the data automatically from the central listing created/controlled by the small business owner. The federated service must be free and should some-what be like Wikipedia (or a part of Wikipedia itself?). Sounds too simple? Yes, hard to archive? May be, but not impossible. There are issues around how entities are represented in each directory –  a standards-based entity-definition system and a standards based data format (microformats) is key to realize this.  

When we are seeing a broader trend to move towards an open, portable and standards-based protocols and data formats, isn’t about time to make that “local move” too? What do you think? If you are passionate about this problem and want to do *something* about it, ping me – may be we can do something together!

— Chandu Thota, CTO/Co-Founder, Center’d

On my mind: Central Market Dallas /  Photo theme: Fragmented / Photo credit: Cats_mom

8 thoughts on “Issues with Local Business Centers”

  1. ChanduI think (for what it is worth) that your suggestion, one that I have long dreamed about, is spot on.It is one though, that would require Google stepping out of the beneficial position of market leader and possibly market monopolist. They benefit tremendously from the fragmented market. From their point of view, their algo gives them a competitive advantage and it is not clear that they would agree to loose that relative benefit.Currently, Google’s trio of problems (bad data, buggy Local Business Center and poor customer relations model) are so noticeable exactly because of their market leading influence. It is conceivable that once Google achieves true monopoly status in Local, that all of the other players might agree to cooperate (without Google) but currently each has the illusion of possible market dominance themselves. Thus I have trouble envisioning the process that would lead to success of your proposal despite its need.Your solution certainly speaks to the bad data issue in a very direct way. But, as an aside, the solution would also need a functional Local Business Center alternative AND a meaningful customer relations model. In the end, there still needs to be a “bug free” way of correcting/adding to the listing.That being said, I am ready. Sign me up!Mike Blumenthal

  2. Mike – thanks for the detailed comment. Agree with you on all counts. The perception that the market leaders have much to lose when something like this materializes is understood. However, as you say that could be an illusion if they are contributing to the data problem.Good software coupled with a great process is achievable with proper execution, and I’m sure you know it! 🙂Let’s see what we can do with this idea…

  3. This idea seems like one of the better ways to solve the problem. That said it still comes down to a couple of key questions:1. Who owns the data?2. What controls the standards?Companies that control the most data don’t want to share it for free.Everybody has a different standard.Starting a kind of open source business data movement has a lot of appeal in theory, but per Mike’s assessment it seems just as rife with spam possibilities as GLBC. The only way I can see it working is more like an association model where all of the players support the association that has a non-profit mandate to make sure the data is good. Then association members get to use the data. The challenge of course is that you would need big players to buy into this to make it viable, and right now too many of them see data as a differentiator. Of course if Google decides to throw their hands up over the problem (or if Obama throws some stimulus money at it) that could change everything.Right now the best solution seems to be an imperfect market-based solution here where a handful of profit-making third-parties keep getting better at the data collection and sell the data to all players who can afford it (e.g. Localeze, IBegin, UBL, etc.). I don’t think any one company will ever dominate this arena, but they could hit some kind of tipping point where their data gets exponentially better than the rest.

  4. AndrewOne way to combat spam in the open source model would be to use a model similar to the secure certificate model where, for a fee, detailed verification & thus certification does occur.It could be a tiered model with a good, better & best level of verification.This doesn't speak to the significant issue you point out, of how to get the major player(s) to coalesce around the idea but I do think the spam issue could be dealt with via the fee…Mike

  5. AndrewOne way to combat spam in the open source/association models would be to use a model similar to the secure certificate model where, for a fee, detailed verification & thus certification does occur.It could be a tiered model with a good, better & best level of verification.This doesn't speak to the significant issue you point out, of how to get the major player(s) to coalesce around the idea but I do think the spam issue could be dealt with via the fee…Mike Blumenthal

  6. Andrew: great questions. Data ownership and standards ownership can cause a lot of friction between the “leader” of the market and the rest. However, from a purist point of view, I believe that a Wikipedia like approach is feasible where the data is owned by the community.Would love to see your thoughts in detail about the associations – sounds like there is a middle ground between what I’m proposing and what is there right now.Mike: with a good association model probably once can entice the big guys to join – that way one can also standardize the verification model etc to eliminate any adhoc methods that vary widely based on the vendor now…

  7. Chandu. Really good piece. It would be a great thing. But there can only be an “association” or standard group when several players have a reason to cooperate. That’s how the IAB standards for banners began. The audiotex standards….et al. Do you think that any of the players you cite would cooperate with each other? Maybe.I think the cooperation would come from the listings companies #1 (InfoGroup, Axciom, Localeze), and SMB marketers #2. They’re all doing different things within this, right?Where else are we seeing cooperation? The real estate sites recently got together. It was nice to see Trulia and Zillow and others on the same page.

  8. Peter – thanks. great points – I do think there is a good chance that these folks cooperate with each other. Historically it has happened before with OpenSearch (formats), Open ID (protocol and formats) etc – so I would like to assume that there is a good chance of making this happen. 🙂Your example on RE market is a great one and shows a proof point.

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