MerchantCircle has been criticized in the past for its agressive and fear driven marketing to get small businesses to sign up to its services (see John Batelle, Matt McGee & Greg Sterling). They claim that 250,000 small businesses signed up for their service. According to Peter Krasilovsky at Kelsey Group:
the claim of 250,000 registered businesses, while impressive, should be sliced and diced for exactly what it is. The vast majority may have been duped into registering by an aggressive telemarketing campaign that strongly implied these businesses had a negative review, so they should go online and check it out. To see their “review,†they first had to register.
The obvious question is, how many of these violated businesses become loyal customers of MerchantCircle and are ready to be upsold into the SEM and promotion packages, etc.? No one will tell me. I imagine it is a very low number. Maybe it isn’t.
Well it appears that they are now attempting to motivate those that did signup previously to engage more with their service with similarly deceptive (although subtler) tactics.
I had signed up with MerchantCircle last year to see if they could help me manage my listing at multiple Local Search Engines including Yahoo and Google with a single central listing. I did everything they asked but they were unable to locate any of my records with Google (they have since stopped claiming to update Google), Yahoo or the Yellowpages so I stopped trying.
Today I received this email piece from them:
****
Customer Activity Report
Dear Mike Blumenthal,
We’re happy to send you your monthly activity summary report for Blumenthals.com on MerchantCircle.
Your business listing profile is 71% complete. Visit the address below to add more information about your business to get better search result placement in Google and Yahoo!
This table shows activity for your business listing for December 2007
Activity Tracker
Nearby Members: 4
Total Ratings: 2
Google: 1
Visitors: 1
Talk To Me: 1
Forum Posts: 0
Yahoo: 0
Connections: 0
Deal Requests: 0
Total Reviews: 0
Active Coupons: 0
****
I was particularly curious about the 2 new ratings as I am in a very small market (15,000 residents). It seemed surprising to me to have that many in one month so I logged in and was unable to find my new ratings but I did find this:
****
Web Reputation Score 
| Service | Data | Ratings | Accuracy | My Business? |
|---|---|---|---|---|
 |
Listing Not Found |  |
 |
local.yahoo.com |
 |
Listing Not Found | |
|
yellowpages.com |
 |
Listing Not Found | |
|
Yahoo Yellow Pages |
****
Given that they could not even find my listing with Yahoo or YellowPages, it wasn’t surprising that they couldn’t find any quality reviews (there arn’t any). What is surprising is that my business still received a “reputation score” of 67%. I guess if I just created a few coupons, blogs and newsletters at MerchantCircle my rating would go up. Nice to know.
What it looks like to me…
They use scare tactics on the phone to get small businesses to sign up for an account, then stick out their chests about how many sign-ups they have. But sign-up numbers are only half the story. They need “active users” in order to make themselves more attractive to investors and buyers, and an “active user” is measured by when you last logged in. So they send you this email to get you to login and … bam! … you’re an active user.
And they call themselves the small business owner’s friend?
Good post, Mike. Thx for the link, too.
Comment by Matt McGee — December 7, 2007 @ 12:06 am
Hi Matt-
I may be an active user but a disappointed one…I have never had a 67% in my life (well maybe once or twice :)).
If they did what they claim to do well, I could put up with some annoying marketing.
Mike
Comment by Mike Blumenthal — December 7, 2007 @ 7:45 am
[...] you’re a company that’s desperate to get small business signups, and you don’t really have good marketing judgment, you’ll use Google AdWords to [...]
Pingback by What Does Your PPC Ad Say About You? » Small Business SEM — January 15, 2008 @ 3:24 am
It amazes to no end that small businesses will continue to spend money on services that don’t provide measurable ROI. We in the community need to spread the word that it’s about generating customers– which may or many have anything to do how many inbound links you have, your toolbar PR, or whether your profile is 67% complete. The folks that can continue to charge small businesses for directory listings or SEO work with limited accountability make the rest of us in the industry look bad.
Dennis
Comment by Dennis Yu — January 26, 2008 @ 3:40 am
[...] the email and survey were an improvement over MerchantCircle’s previous bait and switch (see here and here) promotional efforts the survey still didn’t quite make the [...]
Pingback by Understanding Google Maps & Yahoo Local Search » MerchantCircle makes me feel… | Developing Knowledge about Local Search — February 5, 2008 @ 6:03 pm
I received this same phone call today and wondered how would a client rate my merchant system and why?
Comment by Ms. — April 29, 2008 @ 10:00 pm
[...] it’s not just phone calls. This past December, Mike Blumenthal reported getting emails from Merchant Circle that said his business had received two ratings … ratings he was unable to find on his [...]
Pingback by Merchant Circle’s Cold-Calling Campaign Continues — May 16, 2008 @ 6:26 pm