Here’s What A Good Lead Looks Like in Local
Small business sales is local tech’s ugly sister. Costly and cumbersome, the process of getting a product in the hands of a small business owner is becoming more difficult by the day as a number of startups and larger firms look to build local marketing and operations services continues to rise. But just as local businesses can use the dearth of consumer activity online to find new customers, vendors can also use businesses’ growing digital presence — their social media activity, online promotions and the like — to find new clients.
Enter Radius, a venture-backed business intelligence play that was spawned from location data company Fwix. The startup uses the core technology developed at Fwix — a system for aggregating and structuring the billion of references to places across the web — to track the activity of local businesses, and then packages the information in a business intelligence product for firms looking to sell to local businesses.
Street Fight recently caught up with Darian Shirazi, the company’s founder, to discuss the digital traits of a great prospect and who’s winning (and losing) in the local marketplace.
So I’m a hyperlocal vendor looking for a savvy small business: What traits should I look for in the business’s data?
It’s really about the diversity of the data types. For payment processing companies, they pay close attention to which businesses accept credit cards and which use Square to see who they should sell to. Or, we’ve seen a lot of insurance brokers who filter out business who have run daily deals because they’re more likely to be risky.
TaskRabbit is an interesting customer: they used it to find SMBs who need temp work by looking at the size and type of business to determine whether they would be a good candidate for temp work. Home Depot is another customer — they look at the concentration of contractors to see where they should put there next store.
But, overall, what non-traditional traits are you finding indicate a business’s openness to new tools?
We also look at which SMBs have Google Analytics on their sites; they tend to be more technologically savvy so they’re more responsive to new offerings. The presence of a menu on a business’s page will increase the probability that they will reply to a marketing campaign. Having a menu on SinglePlatform or Locu will increase the chance that a business is viable, and willing and able to pay for new services.
In general, we’re finding that some of the older firmographic data — size or years in existence — are not as predictive of a business’s responsiveness as whether the business has a Twitter account, or “Does it have a Facebook page?” or “How many reviews does it have?” We find those are more predictive than other information.
Radius’s core technology allows the system to track and monitor the ebb and flow of location information on the web. Who’s gaining and who’s losing in local?
Foursquare is declining. I can tell you all of the others are picking up as far as local businesses are concerned. With Foursquare, there is just not that much diversity across business. It’s very concentrated. Yes, people check-in to airports but they don’t check-in to small cafés. There’s this huge top-heaviness amongst a bunch of big places but not as much across the smaller places.
And yet, all of the other social sites are growing. Twitter is growing markedly. More and more, small businesses are onboarding to digital, they’re buying more digital advertising and they’re getting websites and engaging on social media.
Mobile has obviously opened a new swath of location data for technology companies and marketing firms. What sources present the most opportunity for the industry?
Government data are a big initiative for us. We think it’s hugely predictive, and yet a total mess. Knowing a business’s health report; understanding whether the business has a valet or liquor license; access to a business’s tax ID number — this is all information that we think could be hugely helpful.
Also, we think it’s absolutely absurd that Dun & Bradstreet, the incumbent business intelligence firm for the local market — keeps their numbers private. It should be public information. It’s basically name-address-phone number information and a few other basic points of information about the business. Nothing around social or other more dynamic data points.
Okay, lots of companies are trying to sell to small businesses these days. Why do they need a new tool?
For all of the growth in local marketing technology, there’s really been little evolution in how companies reach the small business market. A few companies in the space sell lists, and those are just dead-on-arrival. The data is outdated. It’s pretty much a brutal workflow for anyone who’s trying to make these transactions.Then there are other sales intelligence companies are more positioned to help companies traverse a larger businesses organization structure within a within to figure out who a decision maker might be.
But we’re geared to the storefront business to whom folks are selling point-of-sale systems local advertising. as opposed to finding the vice president of purchasing at HP.
Steven Jacobs is Street Fight’s deputy editor.