There is a fascinating presentation and webinar by the Kelsey Group on the Mobile Local Opportunity. The thing we probably all know but is recapped with detailed statistics in the presentation are:
- That mobile web and search is being lead by the prolific uptake of smartphones particularly the iPhone and that the focus of usage has a partcularly “Local” focus
- The share of total mobile search that is local is going to increase 27.8% of total searches in 2008 to 35.1%. What was fascinating though is that local search’s share of revenue is expected to be over 56.1% of mobile search revenue.
- Mobile ad revenues although small in size relative to other mediums will experience exponential growth (85% CAGR)
The highlights for me were what exactly people are searching and are doing on their mobiles, how to monetize these opporunites and how effective the early results are for mobile ads.
- People are searching for local products and services. Restaurants and bars is the most popular category with 43.4% of people searching.
- Mobile ad click thru rates are great according to Verizon (2%) compared to web (0.25%)
- Mobile ad recall ratesof 33% (41% for iPhones) - and half of these people actually responding to the ads
- There was discussion of other monetization methods: Cost per acquisition ie online reservations, affiliate models etc
I think this steers to a point I have been talking about for years. Cost per acquisition business models will be what makes local search explode. Why? Small business dont track their clicks and understand thier cost of acquisition online, they are lucky if they have a website. We have to make it simpler to get mainstream adoption. ie they are only paying a fixed fee for each new customer and dont ask them to change the way they already operate. Make the web and mobile work for them!
In the next post I’ll talk about some of the problems with implementing CPA models in local and some of our solutions
Tags: mobile monetization, online reservations, Research, statistics
I was reading a post here on the Silicon Beach Group. Elias Bizannes from Pricewaterhouse Coopers had an interesting framework for looking at consumer internet companies. I think its a good categorizer (is that a word) but I recall in the early days I did a slide that tried to distill how we could make Booking Angel successful. Its probably over simplified but I like simple explanations of the world.
Firstly the Internet is all about engagement and transactions. How many eyeballs do you need to attract who will transact with you and how much will you earn. If you are a blog running adwords your transaction is someone clicking on an ad and as such you need to attract alot of eyeballs to make it successful. If you are social network like facebook who have struggled in the past to convince people visiting there to click on an ad, you therefore have to attract a lot more people or work out some way to convince them to click.
Not everything is ad supported there are subscriptions and product sales but it doesn’t really matter the success of a startup is roughly described by the graph below. If you wanted to put it in a formula the survival metric for internet companies in the next year is
Eyeballs x Conversion x $ Transaction > Expenses
In thinking about the companies that are making the real money on the Internet they have enabled other people to make money and have shared in their success. They are the business models and enablers of the Internet. Why is this cool? Its obvious you have other people working on attracting eyeballs for you. Google has been most successful because they have done it without needing the consumer to actually transact ie pull out a credit card and hand over money, all they have to do is click. There is also some argument that Google ads provide some user benefit because theier text ads are in context and relevant.
Imagine if someone came up with a widget that was distributed in a similar way to adwords that actually provided some real user benefit right at the most appropriate time. Imagine visiting your favourite review site, reading a review on a few businesses and then this widget is right there allowing you to make an online reservation, imagine if you were the owner of this website and this useful widget earned you $$ every time a user did it. Now go one step further and imagine you owned the business that was being read about on that website and you only paid for confirmed appointments or reservations made through this widget…. Isn’t that a perfect simple beautiful world. We think so.
Tags: Booking Angel, Startups, Strategy
The trend in online reviews driving more bookings in the travel industry is now starting to happen in the restaurant industry. According to a recent study by Comscore 79% of people who have visited a restaurant in the last 3 months considered online reviews to be very influential in their decision to visit. What was also interesting is that user reviews were given more influence than professional reviews (82% vs 69%). Power to the people , huh. Its not just about restaurants either it talks about several categories. Check out the release here
Booking Angel gives restaurants a way to tap into this opportunity. We will help convert more of these people reading ratings into customers. So which restaurants are getting the Bookings and how do restaurants tap into this opportunity? Our restaurants vary in size and style we have 3 hat fine dining restaurants like Tony Bilsons restaurant Bilsons through to family owned local restaurants …. Some of our restaurants have received over $50,000 worth of new business others only get a few bookings a month. What is fair about our service is that restaurants only pay for each booking they receive…. It gives restaurants a way to start to experiment with their online advertising. If the initiatives they are trying aren’t resulting in more bookings they will know and can start trying something else.”
Peter Barker Owner of the Pink Peppercorn restaurant in Darlinghurst said “The initiatives Booking Angel recommended resulted in about 30 extra bookings a week. That was around 80 extra covers.”
Pink peppercorn is typical of most Australian restaurants they either don’t take online bookings or take a long time to respond to customers when they email them. Booking Angel overcomes this problem as the instant somebody makes an online booking at the restaurants own website or at a website such as Eatability the restaurant receives a phone call and they just press 1 to accept the reservation or 2 to reject. The restaurant receives all the customers details and just records the details in their usual booking diary. They don’t need any special equipment just a telephone.
Tags: comscore, Online Reviews, Research, statistics
