All posts by Mike Blumenthal

Uber: Will Surge Pricing be the end of Uber or will Uber end It?

zp50ciza7v1luawwqivtI have been thinking about this question a lot since receiving the above tweet. Users do have a choice to either use or not use Uber. Why then is there such outrage?

And while I am not sure I have an answer, I have a lot of questions and in the end, I question Uber’s use of surge pricing and think it likely to come back and haunt them to the point that they will curtail it.

We all move through life modeling reality. Uber and its creators are no different in that regard. They are apparently using the current economic model (neoclassical) to implement their surge pricing forumulas.

Price theory [under current economic theory] asserts that in a free market economy the market price reflects interaction between supply and demand: the price is set so as to equate the quantity being supplied and that being demanded. In turn these quantities are determined by the marginal utility of the asset to different buyers and to different sellers“.

Uber’s logic of surge pricing is imepecable. They have studied supply and demand and have found that by increasing pricing they in fact bring out more drivers, drive demand down and in effect achieve a supply/demand equilibrium. So good so far.

The problem? Neoclassical economics has several assumptions at its core: Continue reading Uber: Will Surge Pricing be the end of Uber or will Uber end It?

Google Replacing City Experts with Local Guides Program

Screen Shot 2015-01-15 at 1.29.44 PMGoogle announced today that as of February 16, the City Experts program that encouraged G+ users to become active reviewers will be upgraded and now called Local Guides.

The new Local Guides program implements a multi level approach with benefits accruing based on the total number of reviews written. There is even a code of conduct and a more formalized benefits structure.

The new benefits structure attempts to reward users that are outside the cities where City Experts has been active and to create some level of incentives around writing more reviews. In that regard it is similar to how Google handles contributors in the forum and the progression from entry level to top contributor.

Here is the email announcing the updated program and my standing in the new program:

Welcome to Local Guides

Today we’re happy to introduce an exciting update for our community of reviewers. City Experts is now Local Guides, available to people everywhere.

Local Guides is a community of explorers who write reviews of places on Google. When you write local reviews, you help others feel at home in the world, anywhere they go.

Be sure to read the Local Guides Program Rules that go into effect on February 16, 2015. If you decide they are not for you, you can opt-out at any time.

Starting now, because you’ve written between 50 and 199 reviews, you’ll begin as a Level 3 Local Guide. You can access all the benefits available at Levels 1-2, including applying to become a Trusted Tester of Google products and features before public release. Plus, you’ve unlocked additional benefits available to Level 3 Local Guides:

  • Get highlighted in the Google Maps app with a Local Guides badge
  • Join our private Google+ community
  • In select cities, get invites to exclusive events
  • Apply to moderate Local Guides Google+ Communities

Write reviews to become a Level 4 Local Guide and unlock even more benefits.

Thanks for being a part of our community.

The One Click Economy

I had several “retail” interactions over the past few weeks that rubbed me the wrong way.

I went to rent a car from Enterprise, the only car rental in Olean, for about the 10th time this year. Other than knowing my name, they treated me like a new customer, signing all the forms, holding a huge deposit against my debit card (aye) or I needed to bring in my utility bill (?) and providing a slow front counter experience, despite very competent staff.

one-clickShortly after I wanted to put a small, several thousand dollar over draft protection on a business account at the local credit union. These folks know the color of my underwear, have had many. many dealings with me and the account carried a very high monthly average. But for year end purposes I just wanted to be able to draw the account down for tax purposes. I had to go down to their office, bring my 2013 tax return, sign numerous pieces of paperwork and wait for 3 days to get an answer and then sign more paperwork.

In both cases there was personal attention and competent staff but I felt frustration. I realized after some reflection that what I missed in those transactions was the ease of a one click solution to get me through the most onerous parts of the transaction.

I also realized that the sharing economy companies, while not redefining economies or capitalism, do in fact redefine the customer experience expectations. They are not some new economic model but they are very efficient, albeit new, middlemen in a range of transactions that have leveraged technology to reduce staff and decrease buying friction.

One click shopping started with Amazon, moved on to Apple who demonstrated that you can value add a one click shopping experience with people and a store front.

But the sharing companies have introduced one click transactions to a broader range of activities, car rental (Zip), taxi and limo service (Uber, Lyft), accommodations (AirBnB) and I assume many consumers, like me, have come to expect a similarly easy transaction in all dealings whether local or online.

My expectation created a situation where I was no longer satisfied with the tedium of these recent transactions. In fact I actually resented the seeming redundancy of the interaction.

Obviously companies like Zip, AirBnB, Amazon etc have worked long and hard to provide a simple experience around those points of the transaction that have traditionally been the most painful whether it is a reservation or a product return.

While I don’t think that every business needs an app  I do think that every business, small and large, needs to examine every client facing transaction and explore making theses processes that are not core to their identify, faster, easier and less painful.

And its not to say that you need to remove people from the interaction. I think they can add value. But they need to be given the infrastructure and tools so as to be able to spend their time adding value to the interaction not making me sign paperwork.

I know that most small businesses confront a range of competitive pressures and difficulties in staying competitive. Adding one more “to do” to their list might seem almost impossible. Yet the ability to honor the time and trust that customers give them by respecting their expectations as to process efficiencies is one though that is critical to their long term survival.

 

 

Local U + Moz + Great Speakers = LocalUp!

LocalUp_display_ad_(300x300)Both Local U and Moz are dedicated to providing great information for professionals. LocalUp Advanced, our first joint effort, is bringing together some of the most knowledgable folks in local for what promises to be the best local conference of the year.

We have all of the Local U folks (Aaron Weiche, David Mihm, Mike Ramsey, Will Scott, Mary Bowling, Ed Reese and myself), a ton of Moz foks (Pete Meyers, Rand), Google PLUS other great local practitioners like Darren Shaw, Dana DiTomasio and Cindy Crum all in one room for the whole day.

Well actually several rooms as we are doing afternoon breakouts as well. It promises to be an incredible event.

Take a look at our recently released agenda  to see what the day has to offer. When you are done, go here and order some tickets (discounted $200 for Local U & Moz Forum members)!

Here are a few samples of the topics:

Pigeons, Packs, & Paid: Google Local 2015 with Dr. Pete Meyers
In the past year, Google shook the local SEO world with the Pigeon update, rolled out an entirely new local pack, and has aggressively dabbled in local advertising. Dr. Pete covers the year in review, how it’s impacted the local landscape, and what to expect in 2015.

Local Content + Scale + Creativity = Awesome with Mike Ramsey
If you are wondering who is crushing it with local content and how you can scale such efforts, then tune in as Mike Ramsey walks through ideas, examples, and lessons he has learned along the way.

The cast of characters that will be speaking:
Continue reading Local U + Moz + Great Speakers = LocalUp!

Pigeon Rolls Out in UK, Australia and Canada

Update: Barry reports that it is still rolling out to all English speaking countries except India (thus Indian tech support will not see what you see.)

After a week of rumors and spottings, Google has confirmed that Pigeon has rolled out across UK, Canada and Australia.

What to expect for those of you in those countries? Much of what we experienced here several months ago

    A total reshuffling of the Pack results

Narrowing radius around the search area

Crappy results including a lot of bogus One Boxes and too much emphasis on company name in the packs

Spam being highlighted in the search results

In the US, there was also a drastic drop in Real Estate 7 Packs

Fewer 7 Packs, more 3 Packs

We have seen in the US a certain rebound as well. Manny of the radius, which were very small to start have increased. Bad quality listings have started to disappear and the quality has slowly, slowly improved.

Get ready to use the report a problem button a lot in the coming weeks and months.

Example search “Mobile Phone Repair Southampton
Here is a before

beforeAnd after (still visible from Germany for example)
Screen Shot 2014-12-22 at 10.22.31 AM

Notice in the after the predilection of companies that have the word repair in their name over companies that actually do iPhone repair.

Yahoo: All I Want For Christmas is the Ability to Remove Dupes – All I Got was a Christmas Card

Yahoo sees fit to send me a Christmas card. My Christmas message to Yahoo: Save the Bandwidth and FIX YOUR PRODUCT.

There was a post in the Local U Forum the other day pleading for help with dupes at Yahoo. Here was Nyagoslav’s response:

There is currently no way to remove duplicate listings on Yahoo! Local in a straightforward manner.

The only two options would be:

1) Remove or update the incorrect listing on the source site (most frequently ExpressUpdate, Localeze, or Yelp). Wait for the new information to make its way to Yahoo’s local business database again, and hope that they will match this updated information with the outdated one, and will eventually update their outdated record. This might take… quite a while

2) Claim the incorrect duplicate listing and then cancel it (see here how to do that). This, again, might take some time, especially if the only verification option might be “by postcard”, but it could very well be faster and safer than method 1 above. Of course, you would still need to make sure the business information is accurate on all the data source sites, too.”

Screen Shot 2014-12-19 at 11.30.09 AM

 

 

Why Android in Car is Very Unlikely to Happen

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Reuters has an exclusive report that Google’s next version of Anroid will be car ready for use without a phone. “Allowing drivers to enjoy all the benefits of the Internet without even plugging in their smartphones“.

I have a hard time seeing this happening.  For a number of reasons. Cars, like the iPhone, are integrated devices. Their value is in the combination of various hardware parts and increasingly of the software.

Car companies are well capitalized and self contained. They only allow silent sub contractors to build their components with rare exceptions. And the exceptions are usually when they own them or looking for upscale cache.

Like the retailers and the credit card companies didn’t embrace Google Wallet, the (very) entrenched car powers will keep Google at bay. I can think of a number of compelling reasons and I am sure that there are more.

1)They want to control the total car experience. A Ford is a Ford and Honda is a Honda. Putting Android at the center of that experience will reduce their uniqueness.

2)They want to control the data.They have all learned by now that data is valuable. Even if it isn’t monetized the way that Google monetizes it, they wouldn’t want to lose it or even share it.

3)They don’t trust Google. Google clearly has designs in the car market with self driving cars. Why would they let a potential competitor into their cockpit?

4)Rather than pick a winner they would prefer to
remain agnostic between Apple and Android and allow their customers to pick by allowing attachment.

5)Complexity and Reliability issues. Reliabilty and fit for service issues are huge in the car industry.  Sometimes having more features  just isn’t the right solution. From the NYT: “A survey that AutoTrader conducted this year found that nearly half of shoppers will walk away from a vehicle they otherwise like if the “technology is perceived as too difficult to use.””

6)Security issues. I have trouble seeing how a general, open source framework can achieve the level of security needed. Not that car systems are all that secure currently, but having one car OS at scale would become an incredibly tempting target. Imagine someone holding your car hostage until you submitted payment?

Ford recently jettisoned Microsoft in favor of QNX OS from Blackberry for many of the above reasons. It’s one thing partnering with Blackberry and quite another to do it with Google.

Do you think Google can succeed with an in dash version of Android?

Apple: Local Search Embedded in Spotlight as a Default – Can it Move the Needle?

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More than one ambitious player in local has joined the walking dead in their battle with Google.

Google has long been the top dog in local search. Along the way they bested IYPs, Driving Direction sites and Mapping companies. Google left more than a few, like CitySearch and Yahoo Local, among the walking dead and severely limited the growth options for the likes of  the Groupons and Navteqs of the world. They have gone mano a mano to all comers.

It isn’t clear that this has resulted in great income but it has resulted in their dominant position in the local search market. And has put them in a position to send significant traffic to local merchants.

Mac Yosemite Desktop Local Search via Spotlight

Recently though there have been a number of orthogonal “attacks” on Google’s long dominant position in the local market. Apps and the on demand marketplaces have become high growth areas and potentially threaten Google’s place in Local.

And Amazon seems very interested in local. They have created a “local services” marketplace, are experimenting with local grocery deliveries and have developed a Grubhub local take out competitor.

But what about direct competitors in the space?

Facebook has rapidly become a dominant review site but seems to have otherwise ignored local search even when it would be obvious to include it.

iOS8 Spotlight Local Search
iOS8 Spotlight Local Search surfaces both places and apps as well as web searches from Bing.

Apple on the other hand has been making a slow, glacial move on mainstream local search. When Apple released Maps in September, 2012 there were high hopes for their aggressive entrée into Local but the Apple Maps fiasco seemed to push Apple into stealth mode in local search.

It also pushed Apple into serious fix it mode and I doubt that they have the desire to confront that s%$t storm again in Local search.

But recently we have seen some movement on the local search  front. Apple opened up to direct submissions of business listings, expanded their local business data partnerships significantly to improve data quality, appears to have created an inside Mapping project as well and rolled out Apple Pay.

But their most recent move, again in stealth, seems to me more significant long haul and has the potential to significantly impact Google’s monopoly in local search: baking local search into their mobile AND desktop OS Spotlight search function.

Continue reading Apple: Local Search Embedded in Spotlight as a Default – Can it Move the Needle?

Google Shows New Mobile Ad type for Auto Dealers

Brian Pasch of Mastering Automotive Digital Marketing noted that Google will be rolling out a new mobile ad type for auto dealers in January.

Initially it will be available in limited markets with a limited set of keywords. It is a mobile only ad format will not display on the desktop.

The Dealership Listing Ads (DLA) ads, shown in this example with Toyota dealers, will initially appear when consumers use explicit queries that imply that they are looking for a car dealer. Examples given by Google are:

- Toyota Dealer
– Toyota Dealers
– Toyota Dealership
– Toyota Dealerships

dealer-listing-ads
Image credit: Brian Pasch, Mastering Automotive Digital Marketing

Brian is positioning that ad as a replacement for the 7-Pack. And that very well could be true, or not. It could just be a replacement for local ads that are currently showing. And the pack may continue to show below the ads. I don’t really know. Regardless, the ad doesn’t include review data.

In mobile, the Pack has long been pushed down below the fold by ads as can be seen in this screenshot of a similar search.

Photo Dec 14, 11 10 07 AM

The ad format does reflect Google’s growing monetization of vertical, local markets, monetization above the fold and their strong emphasis on brand. And could very well foretell the demise of the Pack in high value local verticals sooner rather than later.