Intuit’s New Homestead: Local Advertising Revolution, or Evolution?
“Get a site, get found, get customers” all for the rock bottom price of $4.99 a month, is the Homestead pitch to SMEs. For $170 million, Intuit can get Homestead itself, and it has.
Does the acquisition of a ten year old, startup, self-serve, entry level Website design and hosting service by a $2.7 billion in sales financial software company represent a revolution, or an evolution, in the local advertising space online?
I am tasked with evaluating just such a theme on the closing panel of the Kelsey Interactive Local Media conference set to kick off Wednesday morning in Los Angeles.
Intuit will be discussing its SME strategy:
The keynote by Intuit’s Small Business leader Allison Mnookin addresses the challenges of winning strategies for small-business services and advertising, and Intuit’s success strategies.
“Intuit: The Next Local Advertising Agency?” I headlined following the company’s keynote at the last Kelsey conference in March. The Intuit mission is to “help small businesses achieve their dreams,” Steven Aldrich, VP, Strategy and Innovation, Small Business Division, said then. He also underscored: For new businesses, finding customers is the biggest limiting factor to growth.
Enter Homestead, “dedicated to providing small businesses with affordable, easy-to-use tools and services that help them tap the Web to compete more effectively and win more business.”
Why is Intuit so keen on helping SMEs get more business? “Small business is as big as big businesses,” Aldrich indicated in March.
How big is the Homestead business though? Homestead asserts “Since 1996, more than 12 million businesses have used our award-winning products and services to establish their presence on the Web, maintain and promote their site, and sell or market their products and services.”
In announcing the Homestead sale to Intuit, however, CEO and founder Justin Kitch quantifies “We have 100’s of thousands of business websites that are counting on us being around–and staying the best in the industry–for many years to come.”
Financially speaking, Intuit advises shareholders it “expects the acquisition to be slightly dilutive in fiscal 2008 and 2009.”
A positive financial impact of Intuit’s deal with Google to promote that company’s small business products also seems to require several years for fruition.
Bringing small businesses online, and keeping them there, is a tough proposition. Nevertheless, Intuit is making strategic investments aimed at winning in the SME space longterm.
Who else is making big local moves? R.H. Donnelley, Marchex, Idearc…and many more, all who are convening in Los Angeles for the remainder of the week to talk shop, and the big local business opportunity.
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