All three companies are financially healthy and all three have taken different approaches to gaining the traction of local advertising dollars. Yelp has gained a loyal audience base of consumers and reviews, using that base to appeal to business owners to advertise on Yelp for premium placement on the site and the ability to communicate with their reviewers. Yodle has taken the approach of selling consumer leads via the web and phone calls, with an up-front cost to the business owner. MerchantCircle has become a social network for local business owners whose "profile pages" show up on organic search results under relevant business terms. The company offers online advertising products with a scaleable model which requires no sales force.
While Yelp has not released any sales figures, Yodle claims 5,000 advertisers, and MerchantCircle has over 10,000 advertisers. Because of the different models for engaging local business owners, the employee count for each company is also decidedly different: Yelp - 200 employees; Yodle - 250 employees; MerchantCircle - 17 employees. Cheers to all companies who engage and reinvent when the rest of the old media companies stay stagnant. Although their loss, is our gain.
Throughout the course of the year in 2008, we would also like to give thanks to another form of new media that is replacing the old. Citizen journalism, in the form of bloggers, have helped to keep us informed and innovative, while also holding the company to a higher standard. Here are some of the "local" bloggers that helped us become better and the link to their best posts of 2008:
- Andrew Shotland: Local SEO Guide
- Greg Sterling: Screenwerk
- Peter Krasilovsky: Local Onliner
- Mike Blumenthal: Understanding Google Maps
- Matt McGee: Small Business SEM
Below are some of the top stories in "local" from our vantage point (feel free to send a link and we'll add it):
I've also begged permission (I think it's a great message) to release an edited version of a note from our Chairman and Co-Founder, Ben T. Smith, IV, that highlights the year that was, where MerchantCircle has been, and where we'll go:
It has been quite a year…
• This has been the worst tech IPO market in 25 years
• Some of the most important media and yellow page companies lost 95% of their multibillion dollar market caps
• We saw interesting competitors disappear
• We probably saw our personal stock portfolio’s drop more than any time in our lives
• XXX XXXXXXXXXX XXX XXX XXXXXX XXXXXXXX XXXXXX XX XXXXXXX
• XX XXXXXX XXXX XXXX XXXXXXXXX XXXXXXXXXXX, XX XXX XX XXXXXXXXX XXX XXXXXXXXX XXX XXXXXX
• MerchantCircle went from 350K merchants to 650K merchants and now grows 20K merchants a month for free
• Starting as an idea, there are now 700 MerchantCircle Advisors/Members around the nation 'pitching' MC advertising products
• Our traffic went from 5MM page views to 25MM page views and from 2MM unique to over 10MM uniques
• We went from just 500 paying members to over 10,000
• XXX XX XXXXXXX XXXX XXXX XXXX XX XX,XXX X XXX XXXXXXXXX XXXXX XXX XX XXXXXXXX
• XX XXXX XXX XXXX XXXXXXX XXXXX XX X XXXXXXXXXXX XXX XXXXXX XXXX
• Most importantly, we have gone from a large number of merchants to a community/network of merchants who are sustaining and growing the network on their own
So while we will miss our 1M merchants for 08, we have come a long way. You should all be proud of your contribution for 08 and also for most of you what you put in place in 07 that allowed 08 to happen.
2009 is going to be a tough year for the macro environment, but may well be one of the most exciting years for creating an capturing opportunities.
• We should finish up our paid product in January with the email and cost per lead call products: XXXXX XXX X XXX XX XXXXXX XXXX XXX XXXXXXXXX XXXX XXXX XXX XXXXXXX XXX XXXXX XXXXX.
• We will have improved natural growth in merchants onto an ever-improving community platform through the early 09 focus on building consumer and community tools around our merchants. XXXXXX XXXXX XXX XX XX XXXXX XXXXX XXXXXX XXXXXX XXX XXX XXX XXX XXXXX XXXX XXX XX XXXXXX XXXXXX XXX XX X XXXXXX XXXXXXX.
• Our traffic has a chance of moving us up to be one of the top 5 local traffic players with the smallest team in the space (17 great employees)
• And our crazy experiments like dynamic radio XXX XXXXXX, domain XXXX-XXXX, XXX XX YP ad, higher merchant touch, etc---something big will happen as always.
• We will do all this with our small tight focused team and hopefully still have a good time doing it.
I don't know about you, but I'm excited to go to work this year. I agree with Ben that this economic environment will lead to more opportunity for those that are innovative and strong enough to capture it.
Thanks for a great year!