The Death of the Online Directory?

Google has announced this week that they plan to monetize their local business center with maps search results to include branded corporate logos. I’ve already covered this topic in a bit more detail here, but what I’m pointing out is that we’re beginning to see trends emerging as Google shifts towards favouring local search. Google has always been stringent on keeping web content relevant, but their advance on local search is now so sophisticated that it could potentially wipe out the good ‘ol fashioned web directory.
It was only a matter of time. Google have had their sights in place for a while now, and if you’re a regular around Google Labs, you’ll notice that a lot of the time Google will sit in the dark waiting and perfecting their technology before they strike. Our opinion is that Google is moving in for the check-mate of local search. We’ve seen some admirable competition from Bing’s launch, social media giants such as Twitter and Facebook… But the guys at Google know where to play at their strengths.

Each facet of Google.com is at all times two steps ahead of its competitors. They’ve established themselves as one of the most valuable worldwide data mines, they’re API technology is yet to be matched by any other competitor, they’re Maps data is so comprehensive that you can even view Area 51 from a bird’s eye view. With Google street view, the fact that you can virtually walk from one place to another online may indicate that augmented reality isn’t so far away after all. It’s ubiquitous and futuristic, and the choke-hold that this technology has over the rest of the market is strengthening. Google Chrome, despite using Apple’s Safari browser technology, has produced some admirable competition amongst the big wigs of browsers. What about Google Apps? This business model has diverted over 25 million businesses away from Microsoft Exchange and Lotus Notes.

Google Maps is arguably one of Google’s most prized possessions, and biggest seed for growth on the search engine’s path to into local search and mobile search domination. It was only a matter of time before Google started cashing in on one of their most significant works to date. Australia looks to be the guinea pig to test the fiscal outcomes of the new Maps venture. It’s all very exciting, but does this actually signify the end of the online paid directory for anything other than linkbait?

Hotfrog.com.au is Australia’s largest independent online directory, but even Hotfrog makes a vast majority of their revenue from Google AdSense and bases their location data on the Google Maps API. It really is a working example of how Google AdSense, in conjunction with Google Maps, has set up the search engine giant for greater influence. But will sites such as Hotfrog continue to make a profit off Google AdSense through their high amount of site traffic? Unlikely.

Unless Google gives an independent directory a “leg-up” in search, these independent businesses are going to suffer as a result of the trend shift towards Google Maps. Look at TrueLocal and the YellowPages, they’ve got nothing to worry about… But why? You would think that the Yellow Pages would be sweating buckets in the digital age with their phone books having more use now as drink coasters, arm rests and booster seats for short people rather than for locating local businesses. In my optinion, the Yellow Pages have covered their tails well here. They are well networked with Sensis, one of Google’s primary data sources for Australian business information.
TrueLocal on the other hand, despite being networked with Yahoo! Australia’s online search directory, are still closely networked with Google as it appears to favour the business directory as a “trusted source”. You would think that a business directory that is relatively new to the game would suffer, but luckily for them they’ve had the financial prowess of News Ltd. to back their venture.

With Google now planning to sell branded ad-space on Google Maps, the game just got interesting. Businesses, big and small, will now have the incentives to go to Google’s Local Business Directory directly. The implications for the smaller business directory websites here is that unless they can achieve Google’s trust, they will not have the backbone necessary to sell their service as a local business directory. After all, why would a business want to buy into a service that isn’t recognised by the biggest search engine in existence?
Welcome to Google’s inner-circle of local business directories. The game of local search is rapidly becoming the game of Google Maps.

1 Response So Far

1. 1

   By Hugh on 15 May, 2010 at 6:24 pm

   I’ve been thinking about this as well since I am starting a business/tourist directory for my local area. There is already one that exists receiving over 45,000 hits a month yet the site is a terrible mess built in Wordpress. I think people only go there because there is no alternative. My aim has been to offer a much more powerful website ‘web 2.0′ style. I’m wondering if it’s worth my while to focus on articles and news content rather than relying on selling ads. I think in the future Google will be able to create valuable content dynamically as they do with ads which will be even more of a threat to websites. Already, people who are searching for accommodation/business on Google will find a list of them in the form of ads on a map, the only reason one would click on a website is if they are offering something unique. Maybe more comprehensive info or community contribution. Gah! there isn’t much of the market that google doesn’t cover.