A few of us were invited to attend the Piper Jaffray Global Internet Summit in Laguna Beach, California, this week. (We decided to tough it out and attend.) Peter ran an interesting panel titled “The Local Opportunity.” The panel included Peter Horan, CEO of IAC Media & Advertising; Zorik Gordon, president and CEO of ReachLocal.com; Russell Horowitz, chairman and CEO of Marchex; Jeffrey Stibel, president of Web.com; and David Liu, CEO and founder of the Knot.
The participants echoed findings from our research that small businesses need help with Internet advertising. The panelists widely agreed. But there were a few interesting deviations around who would actually be the best seller of local ad inventory.
Zorik Gordon stated: “Self enrollment doesn’t work. We have 10,000 customers and we’ve had four self-enroll. The jury is out in the long run, but I can tell you that putting a button in QuickBooks after someone files their taxes is not going to work.”
He went on to claim that “the incumbent Yellow Page publishers are economically disadvantaged. We get 50x sales efficiency vs. a print rep.”
Horowitz disagreed, saying that “incumbents should not be counted out.” We have heard, but have yet to confirm, that some of his incumbent partners are pushing very high billings through Marchex.
Horan, meanwhile, suggested that while IAC has a bunch of “Premier 1.0 Brands,” he envisioned a day when media partners would sell CPA-based advertising on the company’s behalf. Horan drove IAC to lead the MerchantCircle investment “to increase the lead flow of our operating businesses.” Most of the businesses that sign up with MerchantCircle do not return, so it will be interesting to see whether Horan’s thesis bears fruit.
There were two interesting differences in sales strategy from The Knot, which is the leading Wedding portal, and Web.com. The Knot’s Liu said “95 percent of the businesses we sell have Web sites.” Conversely, Web.com’s Stibel suggested that most of its customers are new to the Internet. In fairness, Stibel’s Web.com is the largest independent seller of Web products with more than 250,000 merchants. It claims more than 4 million accounts in all.
Liu summed up his top sales representative’s strategy for closing business. She told him, “David, I only need three words to sell: Sugar, Honey and Darling.”
Most participants agreed that selling was easier than retaining. Everyone agreed that delivering value to the advertiser was really the only thing that mattered.