Localeze’s Dague: Solving the Problem of Search for Local Merchants

Everyone’s experienced out of date and misleading online business listings (including our columnist Alex Salkever). Localeze aims to make sure the info that powers search and location-based mobile tools remain accurate and current across hundreds of platforms, by monitoring and managing local business identities, as well as authenticating local search results, to make sure that business information is accurate and consistent.

Street Fight recently spoke with David Dague, Localeze’s vice president of marketing, about how small businesses can exert better control over their online identities, how daily deals are affecting the local space, and why the location-based service market will be the next big thing in local.

Tell me a little about what Localeze does.
Localeze started as an aggregator — and we still continue to be — of local business information in the local search space. So, we manage a database of 14 million local business listings that historically — and still, for the most part — are acquired through publicly available resources such as phone books, yellow pages, and things of that nature.

We’ve built out a business on licensing our database to local search platforms like Google, Bing, Yahoo, and others. But we realized from the search partners that offline information is inherently old, so we decided in 2006 to go to the sources themselves. The best source for that information would be national brands with local presences — like Home Depot, Geico, State Farm, et cetera. We have over 800,000 local business listings (directly or through a channel partner) under management by the businesses themselves. Again, that ranges from very large brands all the way down to local mom-and-pop shops.

We’ve had about 150 authorized channel partners that do work with local brands. Some of the big agencies like 360i and iProspect and things like that, down to businesses that do things either in or related to search and provide other services. Things like network solutions, web hosting, domain registrars and folks like Reach Local — you know, folks that do PPC and landing pages and local SEO and things of that nature. So, we have a very large channel partner relationship there.

The opportunity and challenge is getting away from perpetually discounting products and services without getting any residual loyalty out of [your customers]. … I foresee things like Groupon getting into follow-up marketing and loyalty-esque programs to customers who have bought through that channel, so “discount” becomes less of the equation.

What are some of the main problems you see small merchants having when it comes to search listings?
Number one is just perceiving the enormity of it, right? … It’s like, “How do you begin to figure out where my information is, where it’s wrong, and where it’s missing altogether?” So, that’s just one of the big challenges in just the basic listings world. What we help small businesses do in that regard is we provide a single source for them to come in, create their information in our environment once, so it’s consistent. Then we distribute that consistent information out across 140 of the primary local search engines. As a result, these businesses don’t have to worry about having to go from one site, to another, to another, to another, to another to enter or change their information. It’s a time and cost savings and it’s also a way for them not to make mistakes and create their own consistency in their identities at a local level.

How are daily deals affecting the way businesses present themselves online?
Daily deals are a very effective mechanism for local businesses. It’s kind of an oversimplified way to put it, but businesses are going to work with Groupon or Foursquare in a way that’s conceptually very similar to how they’ve worked with a Valpak, right?

The opportunity and challenge is getting away from perpetually discounting products and services without getting any residual loyalty out of your customers. I think the key is the staying power on the value of business. I foresee things like Groupon getting into follow-up marketing and loyalty-esque programs to customers who have bought through that channel, so “discount” becomes less of the equation and “loyalty” and “value” become a bigger part of the equation. Otherwise, what you’re doing is virtually making everything wholesale and that’s not a good model for a business, long-term.

What is the next frontier in local?
It’s going to be in the location-based service market. You know, the whole sort of dynamic of check-ins, et cetera. So, what we see in the future — and it’s going to take a while for these small businesses — we see the value in pitching promotions to businesses that are getting check-ins, and recording check-in information for other marketing.

The other piece of this that I think is just starting to emerge is what the opportunity for those check-ins represent for businesses that are geographically located around the business that is checked-in-to. So, think of it this way: somebody checks in to a steakhouse somewhere that’s kid-friendly, like Red Robin, and let’s say there’s a Baskin Robbins a block away. So, those people there, they check-in at 6:30 at Red Robin, then at 7:15, they get a text message saying, “Hey, we’re Baskin Robbins right next door, stop in for a 10% discount on blah blah blah.” So it’s not just what and where in local — it’s now becoming a when.

This interview has been edited for length and clarity.