Greg Sterling, the Senior Vice President of the Kelsey Group, the prominant “provider of strategic research and analysis, data and competitive metrics on Yellow Pages, electronic directories and local media,” answered some questions about the upcoming PPC offering from Verizon.
Murdok: How does Verizon’s new product fit in with the other existing PPC products available?
The Kelsey Group: As I understand it, the product will essentially work the same way that other PPC products do. FindWhat is providing the “back end” functionality. The principal difference is that bidding will be at a category level rather than an individual keyword level.
murdok: How will Verizon’s product differ from AdWords? Do you think it will offer solid competition or are they essentially non competitors?
TKG: As mentioned, the bidding exists at a category level (e.g., attorneys, auto repair, restaurants) rather than a keyword level (as with AdWords). I believe it will similarly be self-provisioned, but Verizon is trying to make the product simple to understand and use for small business.
Verizon clearly believes the product will offer solid competition and preempt defection of its small business advertisers to other PPC ad networks. However, most advertisers that currently use PPC go with more than one engine/network. So Google AdWords and Verizon’s PPC offering can co-exist in the marketplace.
However, there are many challenges for Google (and any other paid search provider for that matter) in penetrating the small business market that Verizon currently serves. On the other hand, it remains to be seen how easy the Verizon product is to use for advertisers. No doubt there will be a period of trial and error and product adjustments along the way.
murdok: What does their partnership with FindWhat indicate about the quality/nature of the product?
TKG: Verizon made the decision to go with FindWhat because it had a high degree of confidence that the product was well matched to its needs. Interestingly, FindWhat also has a distribution network that Verizon currently doesn’t seem to be tapping for additional traffic to its future PPC advertisers. One of the questions that remains is: will the product be simple enough to attract large numbers of small business advertisers. This is a big bet for Verizon and a very bold move for a company in its market position.
murdok: Finally, do you think that business owners without websites will buy Verizon’s ppc ads?
TKG: Verizon is going to offer “business profiles,” which are individual pages, hosted on SuperPages.com, that feature information about a specific merchant-advertiser. These will operate like mini Web sites and I believe will be PPC eligible. Having said that, merchants without Web sites don’t have Web sites for a reason — they’re “behind the curve,” don’t see any value in having one or don’t have time to develop and maintain one. Any of these reasons suggest that these same merchants won’t “get” or have time for PPC either.
There’s a great deal of interest in PPC in the marketplace, but also a good deal of confusion among small businesses about it. Research on paid search that The Kelsey Group is currently conducting with small businesses indicates that even among relatively sophisticated small business owners and marketing professionals, in businesses with Web sites, there’s confusion and uncertainty about what paid search is and how it operates. The industry must do a better job of explaining the product and its benefits to this audience (and greatly simplify the product) if it wants to gain sizeable numbers of small business advertisers.
That’s the subject of our forthcoming conference: “Drilling Down on Local Search: Drivers & Barriers to Small Business Adoption” (see: www.kelseygroup.com/ddilm2004/).
Garrett French is the editor of Murdok’s eBusiness channel. You can talk to him directly at WebProWorld, the eBusiness Community Forum.
