There's been a lot of talk this year about Facebook opening up its platform and allowing outside companies to build applications specifically for its site. Already, I've seen social applications running the gamut from charities to beer. Facebook's new open platform will allow developers to create applications that keep its members engaged and interested and will also provide companies a direct avenue to monetize these applications.
Recently, I had the opportunity to talk with the CEOs of two local search applications launched for Facebook -- DoYa? and Loladex. In part one of this column, here's what Alson Kemp, CEO of DoYa? says about his company's plan for its social application:
Brian Wool:Can you provide an overview of your Facebook application?
Alson Kemp:DoYa? is one of the leading social search applications on Facebook and is rapidly becoming one of the best ways to ask for and to share recommendations among friends. What sets us apart from our competitors is that we are taking business listings and combining them with a social network (the next generation of communication platforms). This modernizes and improves the oldest and most effective way to get recommendations for local businesses and service providers: word of mouth.
One of the keys to our success in this space has been the comprehensiveness and quality of our local search results. This makes it easy for users to find and make recommendations for their favorite businesses.
BW:How did you weigh the advantages of creating a local application on Facebook over building a standalone local directory?
AK:By working with Facebook, we get access to their great application platform and vast resources. Facebook has extensive advertising channels and viral marketing opportunities, not to mention a great brand. If we chose to go alone, we'd have to reinvent all of these assets.
Being able to tap into the collective knowledge of a group of friends dramatically increases the relevance of the recommendations that a user can receive. Companies like Amazon.com and Netflix are building functions to provide users with personalized recommendations based on previous searches or purchases, but we're betting that people can gauge the preferences of their friends better than an algorithm.
We're also finding that businesses and service providers are extremely interested in social networks but are unclear on how to take advantage of them. Naturally, we're here to answer the question of how local businesses can take advantage of Facebook.
BW:What business categories do you anticipate gaining the most traction within your application and social overall?
AK:It's tempting to try and pigeonhole social applications to a particular category but any business that benefits from word-of-mouth marketing will benefit from social networks. Our application focuses on helping people ask their friends for recommendations, so we're currently gaining traction in high-value service categories, such as doctors, contractors, dentists, Realtors, etc. At the same time, we have a wealth of listings for restaurants in our database, so we also see a number of recommendations for them.
BW:How do you plan on monetizing your application?
AK:We're a lead-generation application and have a revenue model that looks much like one would expect for a local search company: differentiated presentation, coupons, advertising, etc. We add to that base, the services only available within a social network. For example, we can tell a Realtor how effective her clients are at recommending her to their friends. That's very valuable information to a local service provider. Effectively, each local business has an implicit word-of-mouth marketing campaign and we provide the services to help them manage, track, analyze, and improve upon it.
BW:How does the personalization aspect of social search impact user experience?
AK:The primary effect is the tremendous increase in search relevancy. Google's done a great job of building clever algorithms to try to figure out my search needs, but, even with today's technology, searching for a dentist on Google yields results only marginally better than flipping through the phone book. Instead, in addition to providing the general information about the listing [like contact information], we personalize our local search results to show users what businesses their friends use and recommend. This allows us to return a smaller result set and, at the same time, provide much more value because of the enhanced relevance.
Stepping away from social search, this boost in relevancy holds across nearly any market segment or Web activity. Our friends are similar to us and infusing a Web application with knowledge of me and of my friends will nearly always improve the experience. Searching for clothes? Searching for a car? Searching for a local service provider? You're probably going to want to look at businesses or products that are similar to your friends have chosen. Playing a video game? Probably going to want to play against a friend. Going on a vacation? Reading news? Bring in knowledge about my friends and improve my experience.
Stay tuned for my next column when the co-founder and CEO of Loladex, Laurence Hooper, discusses his company's plans for socializing search.
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Brian Wool is VP of content distribution at Localeze, a Chicago-based local search company. Established in 2003, Localeze specializes in connecting consumers with local merchants through online content collection, enhancement, and distribution. An expert in local Internet search marketing, Brian leads the distribution efforts at Localeze and is responsible for content delivery to over 35 leading search engines, Internet yellow pages, and local directories. Brian previously held various sales and marketing positions at comScore Networks and Claritas.
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