Now that Google places has been replaced by Google+ Local, we are all naturally wondering about the overall direction of Google?s services for small businesses. ?It is now apparent that Google is continuing its focus on the market for local business advertising and making a new push to target this segment. ?Google is expected to roll out a new product or package of products to target the $20 billion market for local business advertising by July.
This new package of products has been called ?Business Builder,? and it will combine?several?existing products and services with new ones. ?Here is an excerpt from a recent Wall Street Journal article documenting the updates by Google to better serve local businesses:
Central to the effort is Google+, the company?s social network, which it hopes consumers will use to interact with local businesses that now have special Web pages on the network. Those Google+ pages will draw traffic from the company?s Web-search engine. When shoppers visit these businesses, Google wants them to use their Internet-connected phones like a digital wallet, earning loyalty points and making payments at stores that sign up for Google?s new servicess?
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In turn, Google is hoping stores and other businesses will use their new Google+ pages to communicate with customers, such as by showing them special offers. And it hopes to persuade them to sign up for other Google products.?
The campaign to court local businesses, which is being led by Google executives including Senior Vice President Jeff Huber and Vice President Marissa Mayer, has required buying more than half a dozen companies since early 2011 at a cost of about half a billion dollars, according to Google securities filings and people familiar with the matter. Google hopes to weave some of these acquisitions together with its current products into a portfolio of tools that can serve the needs of local-business owners.
The company soon will begin unveiling the fruits of some of those deals, including services such as TalkBin, which lets customers send anonymous text messages to a store?s manager with complaints or compliments, and Punchd, a smartphone-based loyalty-rewards program, said the people familiar with the matter.
Google also plans to promote a year-old program called AdWords Express, which gives businesses a streamlined way to set up an ad campaign on Google?s search engine, potentially in a matter of minutes, these people said.
A Google spokesman declined to comment on any future initiatives.?
Google?s Mr. Huber said in a statement: ?Helping local business is a big part of our focus at Google, whether it is connecting shoppers with the right store nearby or helping merchants attract and retain customers. In local, our vision is not a one-size-fits-all product, but a range of flexible solutions that make the Web work for all local businesses.?
Internally, Google has assigned a group of employees to focus on developing smartphone apps related to local businesses, the people said. And the company has spent millions of dollars on a nationwide campaign called ?Get Your Business Online.? The campaign includes multiday workshops at which Google helps local businesses set up their own website and a business listing on its search engine free of charge.?
Google already has started testing some of its new services. Last year, it approached the San Francisco branch of housewares and furniture retailer Crate & Barrel to test the mobile-phone service TalkBin, according to store manager Tony Villegas. He said he has used TalkBin, which costs $25 a month per store, to direct customers to use their phones to text him about their shopping experience. When some people complained they ?weren?t being serviced properly or greeted? at the store, he said, he trained his employees to correct the problems.
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?It?s immediate feedback and much more meaningful than receiving a letter a couple of weeks later,? Mr. Villegas said. He declined to comment on whether the company is currently paying for the service.
At the heart of Google?s campaign is a desire to get more merchants to spend money on digital advertising, including on Google?s search engine, where 20% of searches are for local information. Digital-ad spending by local businesses last year reached $21.2 billion, a figure that is expected to increase by more than 12% annually, according to BIA/Kelsey, a local-media advisory firm.
The stakes are high for Google as other Web companies have made inroads into the local-business market. Daily-deals site Groupon Inc. GRPN -8.16% and business-reviews site Yelp Inc., YELP -8.86% both of which cater to local businesses, recently went public.
?The overwhelming majority of businesses are local stores, and that?s a huge pool of money that nobody except newspapers and the Yellow Pages has done a great job of tapping,? said Greg Sterling, an analyst at Sterling Market Intelligence.
Google has struggled to get a meaningful piece of the market. In 2009, it discussed an acquisition of Yelp, but the effort fell through. In 2010 Google hired hundreds of people to call stores across the country to pitch ads that would appear on Google Maps, but the ads were later discontinued.?
In late 2010, its negotiations to buy Groupon also fell apart. In mid-2011, Google launched Google Offers, a Groupon competitor, but the service hasn?t met Google?s expectations, said a person familiar with the matter.?
A Google spokeswoman said Google Offers has picked up in recent months but declined to provide specific numbers. Google Wallet, a high-profile effort launched in spring 2011 that lets people pay for things at local stores by waving their smartphone at cash registers, remains limited in its distribution because of conflicts with wireless carriers.
Google has hit roadblocks with local businesses because its main service, AdWords, is considered to be too complex for the average store owner to use. Google ?hasn?t had the right products? for local businesses, Mr. Sterling said.
Google?s latest push dates to last year, when Chief Executive Larry Page created a ?commerce and local? group headed by Mr. Huber.
The company soon went on a shopping spree for talent and mobile services, including TalkBin and Punchd, a smartphone app that works like a rewards punch card, and in the summer it rolled out Google Offers and AdWords Express.?
Google is hoping its local push will provide a boost to Google+. Last week, Google began converting all of its local-business listings, which include basic information such as a store?s street address, hours of operation and customer reviews, into Google+ pages.
Sometime this summer, Google is expected to direct business owners to a ?recommendation engine? to help them figure out what new Google services might work for them, said a person familiar with the matter.
Still, it isn?t clear how attractive these new services will be to local businesses. James Wilson, the manager at Maoz Vegetarian, an Israeli restaurant in Berkeley, Calif., tested Punchd last year and wasn?t impressed.
Punchd ?alienated? loyal customers who didn?t have smartphones, said Mr. Wilson. So he discontinued it and started an old-fashioned loyalty punch card. That has ?been working really well,? he said. ?I?m not a technical guy, but it was ridiculously easy to set up,? he said. ?
But Punchd has been a boon to SLO Donut Co., a two-year-old doughnut shop in San Luis Obispo, Calif., that has tested the service free since last year. Co-owner Jake Pickering said 30% of his customers, or several thousand people, regularly use Punchd to earn a free doughnuts and coffee, valued at around $3, after their 10th visit?(Wall Street Journal)
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