Why Google’s Local Business Referrals Will Fail

Filed in Google, Local Search by Matt McGee on August 7, 2007 9 Comments

I was brief last night in my comments on Google’s new “Local Business Referral” program, and maybe didn’t explain myself as fully as I should have when I basically threw the idea under the proverbial rug.

Reader “earlpearl” shared a wise comment on that post, and my friend Brad Geddes wrote about the program today with similar thoughts on the need for better local business data.

I agree 100% with the need to improve local business data.

I just don’t believe this “Local Business Referral” program is going to make a dent in that problem. In my comments last night, I said there’s “no chance this succeeds in any measurable way.” Let me explain why in a bit more detail:

What’s the appeal to join this program and become a Google rep?

On the FAQ page about the program, Google answers the “Why become a rep?” question with a quick mention that you can “earn some money”, but they spend two sentences appealing to the good nature of my heart:

The information you collect could be seen by millions of people who use Google every day. And you’ll be helping the businesses you refer attract new customers while also making it easier for people in your community to find the products and services they’re searching for.

With all due respect, I think it’s naive to think that people are going to jump at the chance to knock on the doors of local businesses, take photos inside, promote Google Maps and Google AdWords, fill out paperwork, submit it all online when they’re done, etc., out of the goodness of their heart. You have to provide a better benefit than “you’ll be helping your community find local businesses.”

But Google says there’s money involved…

Yes, you can earn “up to $10” for every business referral. But only $2 is guaranteed — you get that for submitting the business data to Google. Then you have to cross your fingers that the business owner remembers to send in the postcard or goes online to verify the data you submitted. Two things: 1) As busy as small business owners are, what percentage do you think will remember to do that? My guess: less than 2/3rds. 2) If you’ve spent any time reading the Google Maps for Business Owners Group, you know the verification process can be hit and miss.

What I’m saying is this:

It’s silly for Google to think that anyone who’s advanced beyond a newspaper route career is going to want to spend their time doing this for $10 per business, only $2 of which appears to be guaranteed. I give Google full credit for creativity and trying new things to improve the local data. It’s great that they’re being aggressive and trying new ideas. I just don’t see this idea working.

Comments (9)

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  1. iamjustinm says:

    Hmmm. In most areas it won’t be effective, but where I work there’s literally 250 small businesses within a half mile radius. Whoever wants to take a day or 2 to canvass the whole business center could make some good $. There’s already plenty of door to door salesmen who go out every single day selling who knows what. If they could add this to their ‘services offered’ it could pay for their lunch. lol.

    For the most part you’re right though. I almost wonder if google doesn’t actually expect this to work and that they’re just trying to create a little buzz.

  2. MaltaSEO says:

    I think that Google should work on updating the information that people are already providing them before they start telling us to give them more information.

    I have posted two changes to their local business directory and verified them. I verified on June 4 for one listing and June 17th for another and the status is still marked as “Awaiting Next Update.” To me, two months is too long in today’s time sensitive culture, and now they want us to give them even more data.

  3. earlpearl says:

    Matt: I think this may be one of what will be many experiments with regard to long term expanding the coverage and accuracy of Google Maps.

    Years ago as a commercial real estate salesperson specializing in retail real estate, I did this type of function.

    I knocked on every door of every retailer, in both suburban and city environments. My goal was to amass a huge data base of information to later make deals. Deals and commissions that would hopefully make me and my company many multiples of $10/hit.

    It is a long, big tiresome job. No doubt. It may work in certain places, it may not. Google may find some great data collectors and promote them to full time employees overseeing groups of others. Who knows.

    For Google it is a cheap way to experiment with data collection.

  4. Matt McGee says:

    @iamjustinm — I think you’re right to some degree. I wonder how much they really think this will succeed in its current form. They may have very low expectations for it. And BTW, I actually thought it might be the kind of thing my wife could do — it would give her a chance to advertise her real estate agent services to local residents at the same time as she does the Google stuff. ๐Ÿ™‚

    @MaltaSEO – AMEN!!! Couldn’t have said it better….

    @earlpearl – good points all around. (I didn’t know you have real estate in your background…)

  5. AndrewMiller says:

    I largely agree that this effort won’t ignite a nationwide rush to fill the Maps index, but somebody could make a tidy profit for a few days of work. Here’s my back-of-the-napkin math, feel free to tell me I’m too optimistic:

    –Make 500 copies of a 1-sheet flyer with all the details a company needs (cost: $40)
    –Pay somebody $1.50 of the $2 payout for each store they visit distribute and collect photos and data for (cost: $750)
    –Enter the data into Google Maps, keep the remaining $.50 from each listing (cost: Time, profit: $250)
    –Assuming 1/3 of business verify their listing, you would profit an additional $1,333 (500*1/3*$8)
    –Assuming 1/2 of businesses verify their listing, you would profit an additional $2000 (500*1/2*$8)

    –You can find a town with considerable numbers of small businesses so this will scale.
    –The kid is happy to make $750 for 3-4 days of work and actually distributes all 500 flyers without dumping them in a garbage can somewhere
    –Enough business owners respond to the flyer and verify their listings to cover your expenses
    –The opportunity cost (your typical hourly rate) doesn’t exceed your hourly income from this scheme.

    You can increase your odds by collecting email addresses from business owners and blasting them a week later with a reminder to verify when they get the postcard.

    Just a thought. Might be too many flaws in my thinking, but I’m sure somebody out there will try something like this. I did the math and my time is too valuable to spend on something like this, but I would be interested to hear if somebody can make this work. I would do it all myself if I were still in college.

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