There goes the neighborhood: Google moves in

GoogleMaps is offering local merchants the chance to add free, printable coupons to their listings there. Google will make money later by offering with keyword search ads. And they’re priming the pump with ValPak coupons.

This is a stake in the heart of local newspapers. Mind you, most of these small, local merchants never could afford to advertise in newspapers anyway because they are too big, too inefficient, and too expensive. But one of the promises of online was the opportunity to go hyperlocal — not just for content but, importantly, for advertising, to be able to target ads so finely and to eliminate the costs of sale and production so that these small guys could finally advertise with a newspaper company. That was one hope papers had for replacing the advertisers who have disappeared in classified, thanks to the internet, and retail, thanks to consolidation, Wal-Mart, and the internet, too. Strategically, some on the newspaper business understood this. But tactically — take it from me — it was nearly impossible to implement because newspaper business people are incapable of thinking small. They’ve spent so many years just maintaining big accounts that had nowhere else to advertise that they don’t know how to replace them with hundreds and then thousands of smaller accounts.

We tend to concentrate on the editorial side of newspapering when we lament the lack of progress to update the institutions. But editors are catching on. The problem is that publishers often are not. And they don’t have bloggers and consultants and professors and other obnoxious people pestering them at every turn. They just keep going to golf tournaments while Google steals their business. It’s time to pester the publishers. Wake up, gentlemen: You have a new neighbor.

LATER: And here‘s Peter Krasilovsky on the Google gambit.

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  • First Craigslist cut out the legs of printed classified ads. Then news syndication hollowed out the newspaper’s day old news. Now Google is looking to suck the air out coupon-based advertising to choke off newspapers. What can newspapers do to strategically address this situation?

    To respond to Google coupons, newspapers need the following:
    1. Self-service online coupons for local advertisers, they need a lower cost structure for coupons.
    2. Syndication of those coupons, to maximize the impact for local vendors…a one stop shop.
    3. A mechanism for publishing those coupons locally, with reviews, ratings, tags, etc.
    4. Local coupon content

    But how can the newspapers, and other sites for that matter, respond with these pieces of the puzzle in time to block the onslaught of Google on their coupon revenue? ZiXXo has all of this and more today. And the newspapers can even offer a branded version of ZiXXo in about 24-hours! The big question is whether they roll-over and play dead or that respond quickly and aggressively.

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  • Ben

    Local coupons are effective. ValPak which is owned by one of the premier media companies out there has long needed to find an online avenue more effective than thier prior failed attempt at a destination site with Not only did no one ever go to, it was full of national coupons which are not as effective.

    By allowing its coupons onto Google, it has made them more effective for its merchants and taken the first step into taking one of the best sales channels out there for local advertising and connecting it with the local advertising on the internet solution. Valpak is hyper-local and its sales force (franchised) is probably best positioned to move online local inventory. Maybe even more so that the Yellow Pages since the ValPak business is more performance based and more direct and more transaparent that the YellowPages and therefore must more closely aligned to the way Local internet advertising works.

    We are a big believer in local coupons. We will have well over the 20K unique coupons that Google mentions in the ValPak release in the next month and we are just a few guys barely getting started. We have long believed if you can bring 1, 2, 5M local merchants online they will create content. Coupons is in the top 3 types of content we see them creating and the one they are most prolific about pushing far and wide. Coupons are extremely valuable content. When there are 5M local coupons accessable via the web, it will pull even more user activity into local search and dramatically shift the local web experience for the consumer.

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  • Alex

    Boy, this is techno talk all right, thank you very mach. Anybody here has local advertising experience? Understand that building sales through coupon schemes is a looser game. Coupons don’t give you a customer loyalty or brand differentiation; they are just “quickie” shortcuts to get someone to your doors. If maybe 20% of local businesses ever advertise, even less of them use coupons.

    And, oh yes, newspapers are loosing ground, but it has less to do with Google as with the fact that their time is up for changes. And I doubt very much Google or Yahoo will replace local TV, newspapers, magazines and Radio. Somebody will of course, but not them, they are too old:)

  • Ken Jarvis

    Do you know the name of the cities Google will do Co-op ad in?


  • I think it´s Google who also implemented a click for a call where you can receive a call from a business you are interested in… Google susrpise me every day…

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