19:08 PM

Smalltown and GrayBoxx: Two approaches to local search and two approaches to tapping the Yellow Pages gold mine

Local search and local online commerce are the next battlegrounds for the giants such as Google and Yahoo, but also for many startup companies. The lure is the billions of dollars spent on Yellow Pages advertising by local businesses.

We have Yahoo Local and Google Local, plus Max Levchin's Yelp, CitySearch, Ingenio, plus local newspapers and other companies--all trying to grab a piece of the local search and local commerce ad spend.

But tapping into the local businesses market through online services is hard. The same factors that make scaling a global online service easy on the Internet become reversed when applied to local businesses.

For example, a local pizza parlor gets nearly all its business from within two miles of where it operates. Reaching China or even a neighborhood five miles away is something the Internet does well for many companies. But it doesn't make much sense for a local pizza parlour, and the same is true for most local businesses--they all nned to reach customers in their neighborhoods.

I recently spoke with two startups, Smalltown and Grayboxx, with two different approaches.

Smalltown targets neighborhoods and small communities

I was very impressed with Smalltown's approach to local search because of the elegant design and simplicity of the site. Simplicity is not easy to do but it is extremely vital in the online space.

Last week I spoke with Smalltown CEO Hal Rucker. "To succeed in local markets we belive that you have to be local," said Mr Rucker. "So we've created 'webcards' which are a type of virtual index cards with their own web address that can be created by anyone local, by a business or an individual."

An example of a webcard:


Webcards can be attached to each other, and also sent to people. They provide an easy to use template that allows busy, small business owners to create a web page about their business without having to have a website.

And the process is simple enough that any customer of a local business can create a webcard that acts as a recommendation, or a warning, by filling in text and adding photos.

"With webcards we are helping to build what we call the 'local web.' And it creates 'social advertising,'" said Mr Rucker.

The roll out of Smalltown will be town by town. The first two are San Mateo and Burlingame, in the heart of Silicon Valley.

If they can get the formula right, then they can reproduce it in other small towns and city neighborhoods.

Each Smalltown would have a local person/agent to help evangelize the service and also aid local businesses and people to produce webcards. Smalltown is =offering cash bounties to people of $5 per five webcards, a smart way to create a large inventory of webcards, which creates a potentially useful library of local content.

SVW's take: Smalltown has a great user interface and I love the concept of webcards, each with their own web address, each discoverable through the search engines, as well as the local Smalltown portal.

What I'd like to see with such approaches is a compelling front end, by which I mean a reason to go to the site even if I'm not actively searching for something local. What would draw me to it if I did not have a need to find something? I've got a couple of ideas...

Coming up next in SVW: Interview with Bob Chandra, founder and CEO of Grayboxx (still in stealth mode). This local search startup taps unseen databases to create ranked lists of top local businesses favored by their communities. . .