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What’s Next for Yext?

I had the pleasure of speaking with Wendi Sturgis EVP, Sales and Service, and Brian Distelburger, President & co-founder of Yext, and thought it interesting enough to share.

Yext Calls started in 2006, providing a pay-per call network to serve local businesses. Yext got businesses the right placements, businesses only paid when they got relevant calls.

But Yext has expanded its offering with PowerListings, a mechanism for businesses to control their local search listings from a single place.

One challenge brick and mortar businesses face is getting accurate, comprehensive, compelling listings to appear in local search results across the myriad of different local listing providers:

Every month, 6% of companies need to update something about their business: the physical address, the phone number, the hours of operation, and so forth. When any of those bits of information change it can take a LONG time for the correct information to work its way across the 100+ databases that need to be updated. Fixing them manually is next to impossible.

Moreover, many of the local search results providers have all kinds of additional fields available for categorization, descriptions, images, and even promotional text that are often unused because the algorithmic scrapers can’t find the information and the advertiser doesn’t have any good way to feed the relevant information to each different local data provider in the format they’re expecting it.

Now they can.

Yext has built API integrations with all the above players to populate, update and re-index their listings from a single input screen. Business owners now have a one stop shop for getting maximum value out of their location data.

Moreover, chains have all kinds of flexibility in giving controls to individual store owners to make their own updates. Particularly useful for a company like State Farm with 10s of thousands of independent agents, each wanting to be found. But also useful for Sears, whose store managers in NY could roll out “Giant’s fans save big” promotions, while their Wisconsin stores ran “Discounts for the Disgruntled” pitches {PS: I totally made up those examples, so no implication that anyone actually did this…just that they could, which is cool imho.}

There is one big hole in Yext’s net. Google, representing ~50% of the local search market, doesn’t work with them. Google so fundamentally enjoys the challenge of trying to solve all the world’s problems through algorithms, that they seem uninterested in allowing us mere humans to feed them info.

It’s Google’s loss, at this point. For example:

The Power Listings maintained by Yext in this case offer a far richer result: better for the advertiser, better for the user, and ultimately better for the local search engine.

The challenge for Yext may be in pricing. The per location pricing model probably makes sense for Mom and Pop, but for a major chain, that might work out to be a heck of a lot of money annually. How often does your local JC Penney’s move or change their phone number? Why should JC Penney continue to pay?

The answer to that last question may lie in the level of success in traffic generation. Yext has case studies showing a 2x to 10x increase in local listing traffic produced by the richer listings. Those are big numbers!

However, more important to the perceived ongoing value may be the text snippets that can be managed at the store level. Case studies showing the power of these “enhanced listing” call-outs as a marketing and CTR improvement tool could make the price seem like a bargain.

I’d be very curious to see what fraction of local page traffic comes from brand search versus competitive non-brand search. In the above example — a brand search for K-Mart — the various store managers might have an interest in stealing traffic from each other, and certainly that would be the case for franchises, realtors, etc, but what is the value for the parent company to have franchises fight for prominence, given that the parent is ambivalent to which child gets the credit?

For non-brand search the value is obvious, but I’m not sure how big a fraction that represents.

Neither RKG, nor I, have any partnership/advertising arrangement with Yext. This is not an advertisement. I had a couple of great conversations with some very sharp folks and just wanted to share.

Love to get your thoughts on Yext’s business model.

Comments
4 Responses to “What’s Next for Yext?”
  1. Dave says:

    George,

    This is interesting. When I checked in on Yext roughly a month ago they had restrictions on several of the major partners ( Citysearch, Superpages and Yelp) in terms of supporting only 4 locations. Now this restriction only applies to Yelp. It appears they are rapidly making changes. For my clients this is a major improvement.

    I agree with you George that the per location model could use some tweaking or more “break points”.

    Dave

  2. Jody O'Donnell Jody O'Donnell says:

    This is a really interesting edge on the other data aggregators. Having worked with a few of them in the past, updating information, even via feed API’s, would take months, sometimes up to a half a year before the individual sites would update with new information. It is very frustrating as an SEO to charge a client for a service as unresponsive as these have been in the past. Yext sounds like they could have found a real game-changer for themselves.

  3. Pashmina says:

    I’ve watched the Yext offering transform and mature, but from the perspective as a service provider I STILL don’t think it’s at a price point where I can consider it valuable.

    With my own home grown process and system, I’m helping my clients manage their listings more directories (including Google), with many niche directories that I can hand select given their specialty or service (eg. beauty salon or dentist) or location. Plus, I think it’s nice to be able to vary the categories, descriptions for each unique listing.

    As for managing changes, something like Mechanical Turk, or even Fancy Hands can do it for about the same investment. At $499 PER listing PER year, I’d rather invest in an unlimited annual subscription at Fancy Hands to take care of the labor.

    Also, when considering Yext vs. UBL, UBL seems to win on both features and price. I haven’t used either one, so this is just from their web marketing materials.

  4. Very interesting observations, Pashmina, thank you for sharing!