Yahoo Local has rolled out an update to its business model for local merchants, and it’s looking a lot like what the Yellow Pages do, only online, self service, cheaper, and, well, what I’ve been on about for a while – a step towards the online version of what the Yellow Pages really need to become.
I spent some time with the Yellow Pages industry earlier this week at their annual conference, and I must say they are pretty tuned in to all of this. They were most interested in whether or not they should work with Google (Verizon just decided to sell AdWords, for example), but I told them in no uncertain terms that they needed to watch Yahoo. Why? Because Yahoo has built in the ability for local merchants to interact directly with the listings, to create contnt for their businesses, and to buy premium listings.
Today Yahoo has moved the needle again, adding Local Featured Listings, a way for merchants to buy placement on results pages – it’s basically sponsored links, but with a twist. I spoke to Paul Levine, who runs Yahoo Local, and he told me that there has been a lot of demand from local merchants to be “at the top of the page” for a given result. Now, for between $20 and $300 a month, they can be.
This reminds me very much of the YP model of paying more or less for size of ad on the page, (they also pay more or less for the headers – ie and ad in Flowers is more expensive than an ad in Scuba Equipment).
Folks are already signing up (see this search for Bike Shop Boulder), and I see this as potentially a significant new revenue stream for Yahoo Local.
But wait, you say, this is just Overture listings, right? No, not in the end. In the end, if Yahoo is smart, this will be where local merchants advertise, not national 800 number chains. Why? Because that’s where the true value is in the YP, and that’s what should be up front. The race to win the online YP will be all about understanding how users actually USE the service. And right now, it’s Yahoo’s to lose.