MetroSEEQ

More bad economy news this morning - I thought I put together a summary of what I gathered over the past few months.  Maybe there are some pattern emerging to see when this will all end.

• – In April, the IMF said that banks and other financial institutions could lose $1 trillion from the credit crisis as mortgage-backed assets lost most of their value - and it is still sticking to that estimate. So far banks have written off nearly $500 billion - half way there.
• – US Inflation rate at 17-year high, sharpest monthly jump since Sept 2005
• – Consumer confidence index at 16 year low, 5th lowest reading ever and expected to get worse
• – Consumer prices jump 1.1% in June - 2nd fastest pace in 26 years (much worse than expected) and energy prices jumped 6.6% in 1 month.
• – Unemployment rate reaches 5.5% in May from 5% - it is the fastest pace in 20 years.
• – Producer prices up 1.4% in May - 7.2% higher than they were a year ago.  This is the 8th consecutive month that prices had risen by more than 6% on an annual basis.
• – US foreclosures up 57% in January - there was a 9-% increase in the number of houses being repossessed by banks compared with January 2007.
• – Crude oil is 80% higher than it was 1 year ago, and 40% higher at the start of the year.
• – Health care spending to double in 2017
• – Economy is #1 issue on voters minds

Maybe review sites should stop thinking how they can lure local businesses into doing more and more online advertising and think about how we can help them

The second article is from on the San Jose Mercury News.  A local store received an unfair and unwarranted bad review in YELP but Yelp refused to remove that particular harsh posting.  Eventually, the store owner called the customer to apologize on behalf of the employee who did the mistreating.  The customer was then nice enough to rewrite the review.  However, the posting has already been on the web for some time and irreparable damage done.

To make matters worse, the same shop found their positive reviews removed by YELP.  Long story short, the reason was that YELP had detected multiple positive entries from the same IP address.  Well, in this case, the computer was physically at the restaurant.  People who finish their meal can just post a quick review.  This scenario is hard to untangle for YELP and may never well.

This story shows the complex nature of the internet and its attempt to describe human behavior.  In this case, it is very natural to humans to decipher right or wrong, but the fraud algorithm at YELP cannot, thus leading to the damage.

I am always reminded a comment a friend told me about review sites.

If a customer gets an okay experience at a restaurant (say B+), this customer is less likely to write a review than when it’s a C or even a B-.  Why?  because we are humans, by nature we are lazy, unappreciative, take things for granted, and even vengeful. Unless we have a spectacular experience or something that greatly exceed my expectation, it’s unlikely that common folks will hop online and write a good review without incentives.

This bring the question, are the ratings really accurate?  Who’s rating them?  What kinds of incentives have they gotten?  Why has Boorah become popular with its Natural Language filter to find “real reviews”?  What is the penetration of review fraud?

Morale of the story: If a company build a proprietary system, people will figure out how to cheat. 

Local search is any search made with the intention of finding something in a specific geographic location says Carrie Hill, from Search Engine Watch.  MetroSEEQ is the first and only local search engine that heeds to Carrie’s comment.  Even though it’s a bit slow but it works.  MetroSEEQ is now looking for funding to build a team to achieve its vision.  Anyone interested in being part of this exciting and promising startup, please contact me.

Thanks

Review sites like Citysearch and Yelp have been getting into some legal trouble these days.  In the first story, TechCrunch talks about Citysearch’s rampant click fraud that motivated a class action law suit. Also in the comment section, there’s a very interesting comment posted by “MAD” detailing how Citysearch operates - I can hardly believe why people still advertise with shady companies like that.

The truth is, it is very hard to prevent click fraud.  WebGuild.org estimates click fraud claims 28% of Searcch ads.  When you mesh this number with a company that is purely driven by money (ahem, like MySpace has become) and a proprietary ranking system.  You’re gonna get the perfect storm of fradulent activities and exploitation.

Yelp’s traffic/activity has exceeded Citysearch recently but they have problems of their own.  One example commented by Jane from the same techcrunch article said that Yelp would contact businesses asking for $250 to move the reviews they like to the top.  If you turn down the offer, the bad reviews straight to the top.  Very surprising… let me know your thoughts here.

Moral of this story is- Advertising without efficient tracking/metrics is throwing your money away.

A lot of people have been contacting me about how cool Urbanspoon’s iPhone application is. Yes, it’s pretty cool and I wish I had a team to work on a cool iPhone app too to boost my coolness factor. I have several ideas but they are more practical than they are for entertainment purposes. If you want entertainment, check out the Wheel of Meal on MetroSEEQ. Now, that’s a piece of sophisticated piece of code that is far more advanced than Crazym_nus. Take a spin, you’ll know what i mean, and remember to turn the sound on too.

Okay, so why have not worked on mobile app yet? Well, the 1st reason is, I just don’t have the developers who have spare time to do it. 2nd reason is I don’t have 31 million venture money like YELP to do whatever they please. 3rd, the focus of the company is deals and coupons and there are just too many obstacles mobile coupon to be a reality now. Here are 5 reasons

1. Compatibility - too many carriers and too many devices to check phone compatibility. In short, if the world only uses iPhone and AT&T, i’d jump on it.

2. Lack of variety - critical mass hasn’t been reached for these coupons to be useful yet.

3. Lack of design depth - most advertisers haven’t started designing for mobile yet.

4. Interface/algorithm - it’s hard to come up with an interface and algorithm that will deliver you the coupon you need, when you need it

5. Hard to target - not only is tracking consumer on GPS a political issue.  There’s just not a filtering system to send you the relevant coupons yet.  In my view, I think this will have to be proactive than passive on the consumer part to acquire the coupons they want… otherwise targeting is just too difficult.

6: Optical barcode scanner not powerful enough - U.S. standard of barcode is somehow less powerful than Japan’s… that’s why they can do it first and we still have an infrastructure problem to overcome.

I think mobile coupons will happen someday. According to the reuters article I posted earlier, 77% of the consumers between ages 18-34 said they are likely to use coupons if given access to paperless technology.  77%!  That’s a pretty sure bet there if you’re a gambler.  I also suspect the number will grow given the bad state of economy, everyone is looking for a deal these days.