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A flurry of business lead services have cropped up, each a variation on the model that has been successfully developed by ServiceMagic and others. They basically provide a directory, information, leads and marketing services.

One of the new crop of lead services is HelpHive in Seattle, which recently launched and was profiled here. It provides a basic directory. It also provides several tiers of SMB services (including customizable home pages, leads, SEO, multiple ways of contacting businesses, and free video).

HelpHive, however, has inadvertently brewed some controversy by putting in a dedicated phone number for EVERY business listed — not just those that opt in to its system.  Evan Conklin, who owns a plumbing and heating service, is absolutely furious at the practice, and has been venting at the company via calls for class action suits, letters to government officials and bloggers like me.

Conklin raises some important points about the practice of building an alternative directory with proxy phone numbers that might be used as a substitute for “neutral” Yellow Pages. Here is the gist of them.

  1. HelpHive uses an SMB’s trademark without permission.
  2. The customer may think that HelpHive’s dedicated telephone number is real. “When nobody picks up the phone and they are told we are unavailable they think that we are not paying attention to our phones.”
  3. “They call you on your real phone number and try to sell you an upgrade to improve your position in their listings or whatever.”

“I have yet to find one business owner or individual that did not react negatively to the idea of some unrelated third party posing their name or business with a false telephone number on the Internet or any other public space,” says Conklin.

I shared Conklin’s comments with HelpHive’s Karim Meghji, who is getting very familiar with Conklin via phone conversations, Web postings and other communications. It is Meghji’s strong belief that HelpHive hasn’t crossed the line in any way at all. He also says that HelpHive is completely transparent, and emphasizes that SMBs have full opt-out rights.

“Yes, we do have a HelpHive phone number on each business listing,” says Meghji. “We do this so we can provide a low-risk, low-cost, performance-based model to businesses interested in generating referrals and business from HelpHive. Our business approach is ‘we get paid when the business is getting paid.’ In order to do this, we employ a proxy phone number to track and report to business referrals that originated from HelpHive and HelpHive customers. This is not like other approaches where evaluating the return on investment can be challenging at best.”

Meghji also confirms that HelpHive did call Conklin. But it was not a sales call.  In fact, it was “only as a followup to questions that Evan Conklin POSTED via our customer services system about how the contact information on HelpHive works. It was not, nor was it intended to be, a sales call.”

As for misrepresenting whether a business is available to answer phones, Meghji says when a customer calls a business via HelpHive, “the first thing they hear is a welcome from HelpHive and then a request to enter the HelpHive extension of the business they are trying to reach.”

My view: It is kind of harsh to pick on HelpHive specifically — there is no reason to doubt that it sincerely wants to help SMBs while building its own business. In fact, it has a lot of good and helpful ideas that provide a lot of value to SMBs. But we are living in an era where new directories are aggressively soliciting SMB business, and sometime misrepresenting themselves in order to better engage with the SMB (and sell them). In the interest of consumers and businesses, there probably need to be strong disclaimers about directory information when proxy numbers are used without specific opt-in. Doing so wouldn’t necessarily hurt the new directory.

This Post Has 7 Comments

  1. HelpHive should change its opt-out policy to opt-in. That would put the relationship between itself and the companies it wants to represent on an equal footing. To be viewed as a marketing partner and not just a listing service advertising a deceptive phone number, HelpHive should persuade prospects that it offers valuable services — customer tracking, increased web-driven traffic — just like any other service vendor.

    Many SMBs share Mr. Conklin’s concerns. Our strategy consulting firm has run across similar reputation management problems in work for clients over the last two years. Other local search sites also interpose themselves between potential customers and the businesses themselves. For example, CitySearch (“Own this business?”) and (“Enhance your listing”). SMBs already stretched to manage a web presence must now monitor how a growing number of third parties represent them on the web. A blog post entitled “Merchant Circle: How are they profiting from your business name this week?” speculating that Merchant Circle (“Is this your business?”) may be substituting one affiliate’s phone number for the correct direct display number for “many of the hotels in their US business listing index” has drawn negative comments about their version of this practice.

    One of the commenters on that post described this increasingly common business model as “beat me because it feels so good when you stop.” Would making the offer opt-in change the value of HelpHive’s business model? Then HelpHive may have expropriated some tangible, if only tiny, value from Mr. Conklin’s business without remuneration.

  2. This came from The Small Business Commando: Dick Larkin.

    Are you freaking kidding me?

    I suppose if you can’t simple call a business and make a meaningful presentation that results in a deal to advertise, you resort to tactics such as this or the MerchantCircle widespread deception you identified a few years back.

    My advice to anyone wanting to sell advertising to small businesses.

    1. Get off your butt and meet with them or call them.

    2. Explain exactly what you are doing and exactly how you charge.

    3. If you need to, prove that you’re for real by doing before charging.

    4. If the business owner wants no part of you, either remove them entirely, or publish their information unmolested.

    This plumber has every right to be furious, and HelpHive has no prayer of being successful long term if they can’t run a legitimate business without hijacking.

  3. Totally agree with Mr Larkin.

    HelpHive is scorching the earth for future services that might actually have a shot at creating value.

    Of course, you could argue the same aggressive tactics can be found in the DNA of Google’s SideWiki. So long as Google destroys value in its efforts to enhance its corpus, you will continue to find startups that attempt to emulate these unsavory practices.

  4. I share in the concerns of Mr Conklin, particularly if they are providing a phone (without request) that can ring out and tell potential customers they are not available.

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