BIA/Kelsey – Local Media Watch

DMS ’09: Case Studies Highlight Vertical Opportunities

In his keynote message this morning, one message Dave Swanson, chairman and CEO of R.H. Donnelley, relayed was that RHD is going to be investigating geo-specific vertical opportunities, essentially meaning evaluating specific categories in specific cities (i.e., attorneys in Orlando). Swanson’s glimpse into one of RHD’s future strategies provided an excellent segue to the next panel on vertical case studies that featured execs from Everycarlisted.com, ServiceMagic.com and Healthcare.com.

Here’s a quick recap of what each vertical player discussed:

Darrell Campbell, Founder and CEO, Everycarlisted.com: Part of Superpages.com, the site has 2 million vehicles listed with 1 million videos on the site currently. About 40 percent of Everycarlisted.com’s traffic comes from the car tab on the Superpages.com site. Currently, the site participates in SuperBundles deals and car dealers specifically spend, on average, about $1,000 per month. Package deals range from $350 to $1,450 per month. FSBO ads are free. To come from Everycarlisted.com is video and more video — with the goal of being an all video site.

Craig Smith, CEO, ServiceMagic.com: Over the past 10 years, ServiceMagic.com has grown to 950 employees who help push leads to 61,000 member businesses. The home improvement service vertical handles 40,000 inbound calls per week from homeowners looking for service professionals. The interesting piece of ServiceMagic is that it has tapped a group of businesses that are very small (typically fewer than five employees), spend less than $1,000 per month, and predominately (60 percent) do not have a Web site. Looking forward the vertical is evaluating community expansion, same-day service requests and a project cost guide.

Howard Yeh, VP – Corporate Development, Healthcare.com: Healthcare.com’s business model is pay per click — 100 percent performance-based. The company focuses on the 18 million people in the U.S. who purchase private health insurance. Due to state regulations, local agents remain a crucial piece in helping consumers through the complex process of acquiring insurance. Currently Healthcare.com has about 350 advertisers actively purchasing pay-per-click ads that average about $4. In the near future, Healthcare.com is evaluating diving deeper into the health-care vertical whether it be in new areas of medical procedures or monetization opportunities.

A couple of interesting takeaways from the panel:

Panelists commented that Yellow Pages has a long-standing relationship with advertisers, but reselling OPP “other people’s products” — i.e., Google and Yahoo — is not going to work in the long run and therefore owning the customer and expanding into verticals holds great opportunity. As Campbell said, ” I can’t think of a vertical that the Internet is not going to transform.”

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