Flunking the local search market

At a breakfast last week a business owner told me about his struggle to counter negative reviews about his B&B on TripAdvisor.

There’s little doubt that sites like TripAdvisor and Urban Spoon are important to the hospitality industry, as customers check out reviews of establishments before they make a booking or set off for an evening’s entertainment.

Over the last two years most of us in the industry thought Facebook and Google’s Local Search services – both confusingly called “Places” – would dominate the market for these services.

Google seemed to have the biggest advantage as the integration of local search and user reviews seemed to be a no-brainer for the search engine giant.

A combination of poor implementation and anally retentive policies left Google Places stranded. The distraction of trying to slap a “social layer” onto the search platform can’t have helped.

Facebook haven’t fared any better. Much of the problem for the dominant social network has been that users aren’t particularly interested in engaging with businesses unless there’s an incentive like a freebie or prize.

Just last week a US based social media expert was recommending local businesses offer incentives such as “a slice of apple pie” in return for favourable Facebook reviews and likes.

Business owners themselves are finding it too difficult with the demands of too many social networks overwhelming them. This isn’t helped by the services offering confusing products, arcane policies and requiring information being duplicated.

Most importantly though is customers just aren’t using these services. Increasingly it’s clear we want to use custom applications, particularly if we’re using smartphones where it’s difficult to navigate through a social media service’s multiple options.

It could well be that we don’t want to use all in one “portals” – this was the web model that companies like Yahoo! and MSN tried to impose upon us when it became clear that the walled gardens of AOL and The Microsoft Network didn’t work on the internet.

One of the factors driving the tech wreck of the early 2000s was the failure of those portals as highly valued web real estate proved to be based on faulty assumptions and shaky maths.

The failure of specialised search engines and social networks to expand into mobile and local services indicates many of our assumptions today are flawed.

Could it be that the next popping of a tech bubble is a repeat of the mistaken assumptions we should have understood over a decade ago?

Paul Wallbank is one of Australia’s leading experts on how industries and societies are changing in this connected, globalised era. When he isn’t explaining technology issues, he helps businesses and community organisations find opportunities in the new economy.