Local Ad Sales War: Why Google is a Guaranteed Winner
Superpages.com calls itself the “expert in local search” and heralds it is now “moving full throttle with national video product launch.” At the same time, nevertheless, Superpages.com continues to promote an “extended distribution network,” aka Google, the ruler of “universal” search.
Why does Google believe it can get away with offering up a below minimum wage “incentive” package to lure U.S. adults into drumming up local business for the Googleplex?
(SEE: Google’s $10 Local Search Pipe Dream: Slave Wages to Squeeze Yellow Pages and Why Google Will NEVER Pay For a Local Ad Sales Force)
Because venture capitalists and corporations are happily picking up the Google local sales slack, not only on behalf of Google, but even in competiion with themselves, and often at the expense of their own SMB clients!
While conventional blogosphere wisdom hails Google AdWords reseller deals as win-win-wins, it is Google, as usual, that is the BIGGEST winner of all:
Local merchants get the “hand holding” they need to get online, aka on Google?
Online directional media properties get the local ad fulfilment they need, from competitor Google?
Google gets a massive influx of local AdWords business, risk, and cost, free. YAY, for Google!
Local merchants may actually be on the losing end of the Google stick, couging up a 20% AdWords premium for the joy of “holding hands” with third-party sales reps, accordng to a Google top exec, Sukhinder Singh-Cassidy.
Yellowpages.com, Proud YPclicks reseller of competitor AdWords: Despite hailing its own 100 million searches monthly network boasting a 74% conversion rate among “the growing numbers of ready-to-buy Internet users searching online Yellow Pages directories,” YellowPages.com also hails “the search engines people use most,” to the tune of 6.6 billion monthly searches, with Google leading the search pack, of course.
While YellowPages.com self-describes itself as “a leading local search and Internet Yellow Pages destination” its business model includes strengthening the number one local search threat, Google, by re-directing in-house YellowPages.com SMB advertiser dollars to the Googleplex AdWords money-making machine.
ReachLocal asserts it has “pioneered the local search engine marketing industry” and Venture Capital backers Rho Ventures is very attracted to ReachLocal’s pioneering spirit: “Investment group validates the local digital advertising and marketing leader’s move to agressively expand its business,” ReachLocal announced last week. The agressive expansion is being backed by agressive equity funding, to the total tune of $67.9 million.
Rho managing partner Habib Kairouz extols the “proprietary sales force” several hundred strong, that powers ReachLocal’s reach out to local businesses; During the past 12 months, ReachLocal has opened 11 sales offices in the top markets in the U.S.
ReachLocal CEO Zorik Gordon: “We can now begin to roll out our proposiiton both nationally and internationally.”
A prime beneficiary of ReachLocal’s tens of millions in VC funded local ad sales “feet on the street” expansion? GOOGLE, as ReachLocal itself underscores!
Mountain View triumphs once again with NO local ad sales pain, but LOTS of AdWords gain.
MORE: The Real Reason Google Has the Midas Touch
PLUS: Microsoft Gets the Nod from the Direct Marketing Association and Jerry Yang Sees a ‘Kick-Ass’ Future: Yahoo!