It’s not that I don’t think local review content is important, really, it is. It’s just that this type of stuff has to have been some of the earliest content on the Internet, I am sure some of the early messages across ARPANETwere something like “took Molly to Surf Shack on Wilshire after switch testing last night, fish tacos were keen”.   It just seems like sometimes it just takes FOREVER to not make much progress in Internet land.

You have to give Yelp a lot of the credit for the current surge of interest, not only is it a pretty valuable service, but the Google + Yelp  deal that never happened,  and now the Yelp business practices lawsuits have kept them on the front cover of the business section for a while now.

So if you wanted to reinvent this baby one more time, what might you do? Well let’s check under the hood of Alikelist. 

First of all, while it’s a horrible name, it does pretty much sum up what its all about, it’s a list of places you like… so in that sense right off the bat its not a traditional review site at all where the general public pretends to be the next A.A. Gill, giving their two cents on every joint in town.  So that’s it, stuff you like in a list… if you want to talk about stuff you don’t like, well go to a different site, not here. 

Beside the fact that its all positive stuff, another important differentiator is that it’s also not about the anonymous general computing public. It’s not just about WHAT comments are being made about the local businesses, but more importantly WHO is behind those comments.  This has always been the shortcoming of existing review sites… you have no idea who is doing the talking, and whether they’re someone you should be listening to.  There are a multitude of features in ALikeList which allows folks to tie back into their social networks to ask for and receive recommendations on local businesses which make this a key component.

Alikelist is a site to discover the places that your friends, family and colleagues like, and to read a little bit more on why they like the places they like. It simply tries to digitize that conversation that must happen a million times a day offline “Hey Bob, I am looking for a good xxx, do you have any suggestions?”… followed closely by “oh yeah, lemme think… well try xxx,  they were awesome.”

The idea and site execution is great because of it’s pure simplicity. People offer up their opinions on businesses online all over the place, but in many ways it’s all become a big convoluted mess, there is not one central place to go look, and there are often hundreds of long reviews written by folks like bigjoe23 to sort through in order to formulate an opinion. Alikelist thinks that a simple thumbs-up and blurb from a more trusted source will nicely supplement, if not trump, hundreds of longer reviews from the bigjoe23’s of the world.

Like with Foursquare and their check-ins, the business opportunity seems to be largely around allowing those local businesses to better connect with their best patrons in the local community, the ones who not only visit their establishments, but who are walking advertisements for their businesses via their check ins and Ilikelist status broadcast out to their social networks.

But the one that seems to be getting the most attention is a Boston company called SCVNGR, thanks to a $4 million investment from Google Ventures, and word that they’re already generating over $1 million in revenue and are profitable in their first year of operation.

SCVNGR has created a platform that allows individuals or groups such as businesses and schools to create their own location based scavenger hunt games. Early customers are using the service for things like corporate team building, or on campuses for orientations and tours.

 Two things that seem designed to help SCVNGR stand out are the super friendly, easy to use interface and also the broad cross section of devices supported meaning that that most anyone can set up a game and play.   Although I spent 30 minutes playing around with the beta version for individuals, and had mixed feeling on it. 

Getting into the system was pretty easy and the interface was slick and friendly, although as I was trying to set up a scavenger hunt I quickly realized that it was a bit more complicated than I was hoping for, which I should have suspected when I saw that the welcome screen included not one but three help documents to peruse before getting started.

In all fairness the product targeted at individuals is still officially in beta, but getting through the eight tabs , just setting up a hunt with a single hunt objective, was quite a process.  At the end of the set-up I set out to test it by visiting the park at the end of my street where I had created the clue and using the iPhone application I wasn’t even able to search and find my mission keyword… so that mission was aborted before it even began.

I then decided that I’d just try to play one of the existing games.  Again the iPhone version was indeed a pretty slick application but it was a bit cumbersome to navigate around in. While I was playing via the iPhone application, I was forced to pretend I was still using a Motorla RAZR, by continually having to manually type in and send arcane command like “NEXT” just to progress through screens of the game.  I even played the first few clues of one game related to the Museum of Natural History from the comfort of my couch, so the use of location seemed optional… I suppose to allow absolutely anyone to play, even if all you can do is send SMSs from your phone and nothing else.

If my experience is any indication I suspect that the $1 million in revenue that the company is making is largely from custom game creation that the company offers as a well advertised alternative to the self service pricing of a few hundred dollars depending on the number of players and number of scavenger hunts you want to create.

All in all, it seems like an interesting idea and one that I can see a ton of people being interested in… how many team building exercises, conferences and tours couldn’t use a little technological spicing up?  A lot I am sure! Come to think of it, at my last company event like this, we did a scavenger hunt inside Dave and Buster’s… scavenger hunts must be chapter one in the “how to do team building” handbook.

The execution of the product on the self service side doesn’t seem to quite be there yet, but its shortcoming are nothing insurmountable, they just need to simplify and streamline it another notch or two.  

I also noticed a new product coming soon called Radius, that frankly feels like an out of place add on… potentially devised in search of a larger more lucrative business model.  While still under development, Radius will be designed to allow “small local advertisers to effectively utilize sophisticated location-based mobile advertising techniques to deliver targeted mobile coupons to mobile consumers within a certain radius of their store.”

If you’re in the market for a mobile scavenger hunt game, it seems worth it to give it a whirl. It will be interesting to see how the small business location based advertising product works when its released, so stay tuned.

So anyone that’s been around the online advertising world will be familiar with the famous Google Page Rank algorithm. While maybe no one other than Larry and Sergey truly knows how it works, there are literally small armies of SEM and SEO experts that wake up in the middle of the night in a sweat wondering if they left out an important keyword, or whether they need to pay for links to get a boost for their clients.  It’s a fascinating micro economy that has developed almost exclusively around servicing customers and their interaction with Internet search providers, particularly Google and its $20B in annual revenue.

I haven’t bought search in well over a decade, before Google existed, and am by no means an expert in search, let alone local search, but if you’re looking for more information I’d suggest starting out by reading SEOmoz or Greg Sterlings Skreenwerk blog or reaching out to a local search SEO specialist like David Mihm or Mike Blumenthal who are frequent speakers on those circuits and regularly share some invaluable experiences on their blogs at Mihmorandum and Blumentahals.

But to greatly over simplify, fundamentally there are two main components in play for Google on the web, and how well they translate into a true mobile location aware search is fuzzy at best.  So for the current Google web search here are two key factors being looked at:

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Forget about having me book an airline ticket, I’ll spend a week on Expedia with all those awesome options to work with… well what if I try these days, in to these airports within a 50 miles radius, with these times… now I wonder what will happen if I can try to arbitrage either two one ways, or throw in that trip to Denver next month trying to cross book that return with this departure using the same flight numbers… what fun!

So you can only imagine my excitement when I heard about what a company ReserveX was looking to do tying together location based marketing with yield management designed for tickets sellers. Sloshing around in a big ol bucket of data trying to maximize revenue by continually re-pricing to match supply and demand is one thing, but to introduce real time proactive mobile marketing and trying to figure out how the completely new dimension of proximity will fit in seems pretty damn interesting.

 I suppose the proximity aspect is not truly new, since folks booking airlines flights have always had the option to fly into nearby but less convenient airports, and the sellers have long tried to put a value on that. But you have to think that physical proximity between a consumer and the goods they’re after is a great filter, if for no other reason than it’s inherently convenient and creates the least amount of effort… it could surely be a huge factor for all sorts of purchase and pricing decisions beyond tickets.

The ReserveX opportunity is seemingly pretty straight forward, just like the airlines, entertainment venues want to put as many bottoms in seats as possible. When Madonna comes into town this is not a problem, but at an industry wide level, venue fill rates are well below capacity. Right now it’s not always easy for a consumer to discover what and where events are happening and if there are still tickets available… while at the same time venues large and small are leaving many seats un filled.

Many of the large players like Ticketmaster, Live Nation and Tickets.com have developed systems to allow other application developers to query their inventory and to buy tickets, in an attempt to reach a larger potential audience of ticket buyers. But ReserveX is taking things a step further by doing a few more things. Not only are they aggregating all those source of tickets into a single place, from guys like Ticketmaster and Live Nation down to your local jazz bar, but they’re also developing a yield management capability which will allow venues to better fill and monetize those seats.

What is uniquely interesting about yield management for entertainment venue tickets sales versus say airlines is that there is the new opportunity to use location, including proximity to a venue, as an important new factor in the equation. Since yield management typically is used when inventory is perishable, and the value goes to zero at a particular point in time, the time element has always been a key part of the yield management equation. Now time can be paired with place to even better determine customers who may be most receptive to buying tickets, and to offer those who are most easily able to act with special last minute pricing or offers through their mobile devices.

Pair this with that Apple physical meets digital affiliate marketing patent, and pretty soon you might have your local bar offering you a free drink to book your tickets to tomorrow nights nearby Jay Z concert through your phone from his bar stools… not only for the potential repeat bar business, but for the direct affiliate fee revenue.

Juniper research estimates that by 2014 there will be 15 billion mobile tickets is use. And ReserveX is hoping that more than a few of these will be tickets to check out your favorite indie rock band, purchased a few hours before the event at a 50% discount, from the comfort of a bar stool, a mere ½ mile from the venue.

Well after giving it a bit more thought, I’ve come to the conclusion that the industry needs a more broad “presence at place of sale” (PAPOS?) metric that could capture all the events where a person actually walks into a brick and mortar retailer and that action is recorded by any available means.

The PAPOS could then be looped back into the marketing ecosystem serving as the click or conversion rate for all advertising, both on and offline, targeted at driving brick and mortar foot traffic. When consumers actively check in somewhere that is fantastic, but I think it’s a bit unrealistic to expect this to become a ubiquitous consumer behavior, and it’s certainly not the only way to know when someone is in a retail store. Besides the 100% active way of checking in, there is of course the 100% passive way where your phone location is just recorded in carrier location logs, and many, many things in between like credit card and loyalty card swipes at retail and of course the wi fi and GPS positioning directly in the phone which enables all those great mobile discovery and navigation apps.

I suspect that the active and explicit way of registering PAPOS through check ins will be pretty limited and much will be inferred or recorded through other methods, you’d figure some company will just find a way to throw up 14 million geo fences around all of the retailers of America and fire back geo pixel trackers each time a mobile device enters a place of interest!

A more systematic way of recording PAPOS would go a long way in opening up the world of mobile and local digital advertising… which currently suffers from a serious disconnect when measuring ad effectiveness when they’re looking to drive offline foot traffic… tracking click to call is ok, but how often do you find yourself calling your local McDonalds? “Uh Excuse me, do you have chicken nuggets in stock today, I just want to be sure before I drove on over?”  HA!

As cool as FourSquare is, why stop there… Mr. Best Buy CMO, if you’re listening here is what I think would be a more comprehensive way to use mobile and location data in your business:

First and foremost be sure people can find your stores when they’re looking for them… call Universal Business Listing and Localezeto make sure your complete list of stores and as much information about those stores is correctly propogated out to all the players in the geoweb… oh year and be sure to claim all of your Local Business Listings on Google. 

Want to pull more customers into your physical stores from the web and mobile web? Check out folks like milo.com, where customers can search for items carried in your store on the web and then find the closest nearby store where they can walk in and purchase it then and there… or hire some clever local SEO experts and associated content to create massive amounts of web content around all of your most popular products and tie them back to the location of each of your stores… that way digital searches for “Garmin Nuvi Detroit” lead folks to your brick and mortar stores.  

Want to better understand the people that already come into your stores why not ask someone like Sense Networks if they can drill down around your stores to see how far folks that are coming to your store are traveling to get there, where they go before and after going to your store, or if there is a nearby roadway that could should be driving more traffic but is not… it may be time to buy a new billboard on that nearby superhighway.

Want to help your suppliers and store management better understand what is selling and why? Why not talk with the folks over at Awhere.com to take a deeper dive into the demographics, weather and a variety of other geographically specific factors occurring in the areas around each store that may be having an impact. Not selling many GPS dog trackers at store #2718?  Maybe its because pet ownership in a 50 mile radius of that store only indexes as 28 versus the national average.

Once you’ve got customers in your store why not provide better in store service and create a little mobile store portal to help customers do things like find their way around (Blue Umbrella Indoor Navigation), look up consumer reviews on the items you carry and do price comparisons on items for sale, look at what you have in inventory, and leave feedback for a manager, etc.

In fact, why not just sell virtual digital goods right there in the store through the phone while you’re at it. Why not give Apple a call and remind them about that nifty digital meets physical affiliate marketing patent they filed, and see if you can put it to use by marketing music through listening stations in the store where consumers can download directly to their iPhones while providing Best Buy with a nice high margin affiliate fee for driving the download.

I am sure there is more, but that should be enough to get the ball rolling in 2010.

NYC based Foursquare has undoubtedly been the leader in this area and their success seems to be attracting a lot of imitators.

Here are some thoughts on the importance of check ins and the ensuing pile on we’re about to see of folks adding on the feature.

Why Check Ins are interesting: 

•  for retailers, particularly places like restaurant, their regular customers are the bread and butter of their existence and they need to be well taken care of. For years stores have offered reward cards to reward their customers with their loyalty and repeat business. In one respect mobile check in’s are a modern twist on consumers registering their loyalty to a business… customers that 1. check in at a business often and 2. want to tell all their friends all about it, should be treated like gods by those retailers… not only are they reliable repeat customers, but they’re great marketers for the business as well.
• for the consumer and their social network what you say you do on your Facebook updates is one thing, but what you actually do and where you go is sometimes so much more telling and valuable. It adds another dimension to what people know about you, and what you want to tell the world about yourself. Since its driven from the mobile device, information is both timely and relevant to the immediate world around you, making it potentially more valuable than similar web services which are more like a history book than a telephone.
• having a bunch of strangers write out their opinion on various retail establishments is often valuable, but at the end of the day they’re very often nameless, faceless strangers… you may agree with them, or you may not… if enough nameless faceless strangers are all saying the same thing then the odds are that you may feel the same way as everyone else. But with the check ins and comments tied to your social network, you can take into account who is saying what and can factor in that knowledge.

What would make check ins VERY interesting.

• check-ins develop into the click rate for the geoweb. On the web, much of the advertising economy hinges on getting folks to click through and check out a web site, something advertisers are often willing to pay big bucks for. Within the geoweb, a check-in could be a similar proof of performance for mobile advertising, show them an ad for Sonny’s Restaurant on UrbanSpoon and they later check in at Sonny’s for the first time? That can be priced not too much different than a CPC deal.
• analysis of a pattern of check ins, in aggregate over time for predictive analysis and ad targeting. This is already pretty standard stuff on the web with behavioral targeting capabilities and if you like this you’ll also like this functionality. So it would only be natural to extend this to the mobile and geoweb.

Why in the future, check-in’s may not matter so much

• well theoretically you shouldn’t need to have someone press a button on their phone to tell you that they went somewhere. The technology already in place in the U.s. already knows your location without you having to do anything except walk around with your phone on. Folks like Sense Networks already get access to aggregated location data like this from wireless carriers and use it to allow businesses to make better marketing decisions, no check ins required. I do suspect that there could be a line drawn between the self reported locates and those aggregated and anonymous locations, with the former available for more widespread and individually targetable marketing uses.

It will be interesting to see how things progress between the self reported locates provided by check ins and the just plain looking up location and tying them back to a place.

Anyone can make the functionality to allow folks to check in somewhere, that’s not a big deal, what is a big deal is getting people to actually use it and use it a lot, and then how you make use of the information once you have it.

So when I heard about Yelp adding the functionality I checked it out buried in a drop down menu somewhere, my first thought was well that seems pretty useless, what’s the point of me checking in on Yelp, its a restaurant review site for me, and that’s it, no one except me will know I checked in or care.  There was nothing in it for me to check in.  Now if Facebook added the feature, that could be a different matter… it all depends on how they do it and what is in it for me if they do.

I love Yelp and use it frequently, and to a degree I get the rationale on why its a potentially attractive acquisition, particularly for someone like Google that is looking so aggressively at targeting the local brick and mortar businesses, and their advertising budget. Yelp has many of the right relationships with local advertisers and at the same time has a nice content creation tool and user base who rabidly create tons of local oriented content… all a very nice fit with what Google does and where they’re looking to grow.

 But the deal between Microsoft and Localeze in my mind directly tries to fix something that is currently wrong when you search for local businesses. So many times I try to fire up a mobile browser in the hopes of searching for things around me, and so many times the experience is just so damn underwhelming. No sign of businesses that have existed for years and years, no understanding that I am a consumer looking to walk into a retailer and dont care if someone deep in the skyscraper in front of me runs a web LLC out of their apartment on the 25th floor.

I can still stand on the sidewalk peering into the window outside of Sohpie’s Cuban Cuisine staring at huge baskets filled with yummy empanadas and then turn and do a mobile search for the term ‘empanadas’ and end up being directed to go miles away to Empanada Joe’s, Empanada Mama’s, and Reuben’s Empanadas.

Currently the local search solutions are either far too simplistic in understanding the search query… ie search for ‘empanadas’ and get back a list of places with ‘empanada’ in their business names, or they return 372,000 page that match the place and the term ‘empanada’ which is an unwieldy mess to sort through if you’re just standing on the corner with 15 minutes of your lunch break left.

Localeze clearly has this problem in their sights and is looking to help connect mobile searchers with the closest place to fill their bellys with empanadas even if the place selling you those empandas is called Sophies.

For Google at least, there may be a day when all of those Yelpers will rave about the great empanadas at Sophies and the Google algorithm would put aside those 371k other pages, and put two and two together and match the Yelp content about empanadas at Sophies with the Sophie’s business listing and give me a great search result. But the problem for Google may be that it’s special sauce is built around links (and votes) between web pages not necessarily analyzing the content or intent of the words within pages… so whether or not Google can effectively and reliably make that connection, particularly without owning the content is still a big TBD.

Per John Hanke, VP of Google Earth, Maps, and Local from a recent TechCrunch article : ”PlaceRank is like PageRank for places, it tries to figure out how prominent a place is based on factors such as references on the Web, reviews, photos, how many people know about it, how long its been around.”

By the way I think it’s notable that the thing being “figured out” here is “prominence”.

Now I understand that you’ve got to start somewhere, but I would argue that the tactics used in web search engines don’t really apply to spatial search much and it should be treated as a completely separate animal.  Web pages are about text and the authors of that text linking to (and as a result voting on) other web pages, in order to determine a pages’ ‘prominence’. 

I think there are a few key differences when looking at location and spatial oriented search:

• The “prominence” of a search result is relative to things like distance and the convenience of alternatives in local/spatial search, versus something more absolute in web search where you’re simply clicking on a link to ‘get there’
• Determining “prominence” is very important when parsing through 1 trillion pages of “always available” information, but in the more dynamic yet much more limited options of local search something as simple as solving for “highest prominence” may not be the right answer
• The true “linking” happening to a physical place is not happening on a website, but through foot traffic and phone calls… and the traffic links between places is not captured on a webpage at all, but on a handset or a carriers’ back end logs
•  The stuff being searched for could and should exist in a variety of mediums, not just html on webservers… find a person from their mobile device, find an item from an inventory system, find a bus from a location sensor.

I suspect  that there will be some incremental improvements over time with matching online information to offline stuff, but I also suspect that we’d be better off by blowing up the existing search model and starting over from the ground up with a model designed purely around location specific spatial search, that merely taps into the vast reservoir of online content only when necessary… rather than serving as the foundation.

• Google already has over a million and a half advertisers across its global business, sounds like a lot huh? Well there are 16 million local businesses listings in Yelp alone, so there are still a ton of potential advertisers who don’t use Google… and the ones that the Yelp sales team deals with everyday are of the local brick and mortar store variety, the same ones that very often don’t even have a web presence, let alone an AdWords account.
• Google already developed Google Place Pages to give every place on earth a webpage.  Yes very philanthropic and all, and yes now it’s great that the Central Park Carousel now has its own web page.  But one of the expected by-products of creating PlacePages was that those brick and mortar retailers who never really cared much for the web and didn’t have a relationship with Google, would wake up and say ‘wow, now I have a web page? thanks Google, let me claim it, and build on it, and take care of it and oh yes buy some advertising to promote it.’  It’s just possible that the initial reaction Google is seeing is that it’s not going to be that easy and maybe they need someone like the sometimes heavy handed Yelp sales force on the phone to force the issue a bit.
• Google lives and dies off of the creation of content and information on the web.  In the same way that it wanted to own Blogger in order to be closer to those who have created 332 million pages of blog content on anything from pet Schnauzers to the history of the bowling ball, Yelp has established itself as an important tool and industry leader for folks wanting to create content  focused on the local community and businesses… some use the term ‘lifestyle blog’.  While it looks like Google only indexes a far more mundane 25 million pages of content on Yelp, the commercial potential for this content is in many ways much more rich, since there are real live companies with ad budgets behind many of the pages, and something there to be bought and sold which makes it fertile ground for advertising demand.  

Some interesting numbers to consider:

• Size of the quickly dying yellow pages business: $15 billion. Will your Yellow Pages Rep be replaced with a Yelp Rep that down the road could be a major seller of AdWords as the new alternative to that yellow pages ad? It would mean more money in Google’s pocket versus relying on local re sellers.
•  Yelp currently has 8.5 million reviews, with 3 million businesses having at least one review… that’s almost $65 per review at the rumored buyout price.  Seems high, but not crazy high considering what people pay for an Associated Content piece… and it will only grow from here at little to no cost to Yelp.
• Yelp sells an estimated $30-40 million per year in advertising via 200 local sales people, I couldn’t find an advertiser count for Yelp except for some off handed remarks about having “tens of thousands of businesses accounts”, but using as an estimated 1.5 million advertisers for Google generating $22 Billion in annual revenue, the average advertiser on Google is worth nearly $15k in revenue… I’d hazard a guess that this is at least 5-10x what Yelp is getting, probably much higher.  So the opportunity to get more out of the Yelp field sales team by giving them more to sell seems significant.