MerchantCircle to Crush Yahoo! Local Listings with Local Business Networking
Greg Sterling stacked MerchantCircle up against the Yellow Pages. So did Peter Krasilovsky.

Obviously this is correct - recently-launched MerchantCircle provides a web page listing, blogging and email newsletter applications, and a local business network that drives local web presence for small businesses.

As folks increasingly use the web they will decreasingly use the Yellow Pages print offering, and though I don't know the Yellow Pages' online offering, I suspect that MerchantCircle considerably trumps what's currently available from a customization and local networking perspective.

Neither Sterling nor Krasilovsky mentioned Yahoo! Local Listings, Yahoo's service that *also* offers local merchants a free web page. Michael Bazeley mentions Yahoo's listings in his write up, but doesn't delve into the key social networking difference that will have MerchantCircle kicking Yahoo's ass for several crucial months.

In thinking on why Sterling (king of all local) didn't mention Yahoo Local Listings I wondered if perhaps this Yahoo offering is simply off the radar in terms of adoption and Yellow Page disruption. I don't know the space, so it could be that Yahoo's free sites are simply not being used.

That said, I think MerchantCircle's social networking functionality is so no-brainer that it makes me wonder who's driving Local Listings over at Yahoo, given the company's social media intrests. (Their recent loss to YouTube in social network + video is right in line though...)

Yahoo! Local Listings Free vs. Merchant Circle Free
Both Yahoo and MerchantCircle offer a free web page and the opportunity for local user feedback (Yahoo had local feedback in local search listings almost a year ago).

Here's what Yahoo offers for free that MerchantCircle doesnt:
map
access to Yahoo local search traffic

And here's what free subscribers get from MerchantCircle over Yahoo:
develop "local merchant network"
email marketing (to 50 people max)
blog
create coupons
access to moderated forum

Quick critique: I think that MerchantCircle is foolish to NOT offer a map to their free users, especially if it could take away one of the two advantages that Yahoo has. Perhaps they found this is not a big deal to local merchants. It's certainly a big deal to me as a local consumer, and I don't think it's very user-centric to not offer maps to business owners who don't pay (or for all the listings pumped in from their local business database).

And as for access to Yahoo traffic, there are over 175,000 MerchantCircle pages in Yahoo right now (the sight was well seo-ed). How long will Yahoo let them stay there if they compete significantly with Yahoo Local Listings?

Yahoo Local Listings Crushed by Merchant Circle Social Network
So what I think MerchantCircle offers that's going to crush Yahoo (and the YPs too, though I'll leave discussion of *that* industry to my esteemed colleagues) is the local business owner social network.

Because when local business owners invite others into their local networks they can put ads on *their* pages (sort of like comments in MySpace). In addition, a given local business page's site will also include all of that person's contacts within the local business community, giving their associates a little cross-linking boost and emphasizing their connections.

MerchantCircle makes it profitable (from a presence perspective) for business owners to invite other business owners into the fold - it becomes a sort of popularity game the way that MySpace is, which will drive their viral spread over Yahoo.

In fact, I think it will drive their viral spread even before MerchantCircle users start to notice an actual measurable return (through the redemption of coupons).

Ben Smith Q/A in eMail
I had initially declined Patty Oien's offers to speak to Ben Smith. (Patty's a PR badass in my book, Mike Manuel :) Then the more I dug into their offering the more questions I started having, so I shot Patty an email last night (blogger was down yesterday too otherwise I would have just published and let the chips fall :).

Most notable - to me - was the concept of the Local Internet. Smith's project brings that concept home in a way that I haven't seen before (and he pulls together so many disparate pieces in a compelling way).

Anyways, I have some of Smith's responses here. If you have more questions leave them in the comment section - he's a very responsive CEO:

Yokel tie in?

On Yokel. I have never heard of them. You just created an action for my BD guy. We have looked at product inventory search with StepUp and do see this space as something we need to work with others on soon.

SpotRunner tie in?

We have done some trials with SpotRunner. There are still kinks to be worked out to allow them to effectively work at the price point and volume we see as relevant for local merchants in volume. Of course, they are certainly having some success with businesses willing to spend significant money and have opened up new markets for TV ads, but our initial experiments suggested more needed to be done for us to be able to make this work. We do look forward to more work in the video space. There is a lot out there in the video area with Videoegg, youtube, etc and we are working this area.

going into China? (or... what's your next market)

There is an enormous opportunity in China as well as the Spanish speaking US and Mexico market, but with 7 employees, we want to get some true success first. Having said that the investors we have and ones I work closely with have a lot of expertise in China and the Hispanic media markets so we have considered this area.

where's sms search? Where's mobile?

We already are working on trials in SMS. One of the guys who worked with me at Spoke.com, Zaw Thet helped create 4info.net and we believe there is a big opportunity with our coupons and deals on their phones. We have also talked about our tests with Jingle in using the phone. In the end, we see a large number of companies who are creating large amounts of local inventory and we want to connect that inventory to local businesses.

MerchantCircle APIs for developers?

We have not worked on API’s at this point but we have created millions of RSS feeds for developers to use on sites. We are spending a lot of time leveraging the API’s of some of the big ad engines. We would love ideas on API’s that developers want.

opportunity for grassroots groups seeking local sponsorship?

We see about 10% of our current merchants being community organizations. Schools, churches, and other local organizations are all using the system. We are working with them to understand what special functionality that we can provide for them.

introduction for local merchants to local sites they may not have known existed like Meetup.org and craigslist.org... look for other ways to get involved locally.

We see about 10% of our current merchants being community organizations. Schools, churches, and other local organizations are all using the system. We are working with them to understand what special functionality that we can provide for them.

In terms of other community sites, we are looking at ways we can help out merchants leverage these. This ranges from Topix.net new listings to Craigslist and things like GoogleBase.

More questions for you Ben, if you have a chance:
Were you aware of Yahoo! Local Listings as you developed your product?
If so, how did that offering influence yours?
Please give me a link to a page describing how you're offering paid search to your merchants.
What's your exit strategy?

Have you been getting Merchant Circle phone calls?
Read this: Challenges of Growth.

...also: " If anyone would like their listing to be removed from MerchantCircle please email support@merchantcircle.com and include your business name and phone # and we will remove your listing from the site and your contact information from our system within the day."

The page you are on is in no way affiliated with MerchantCircle, though we do think they have a cool service. Calling you and freaking you out was probably not the best way for them to tell you about it though ;)
Garrett French - MarketSmart Interactive | permalink | +marktd |