Fast Talk: Search Them

Cracking the Code

Marc Barach

Chief marketing officer, Ingenio
Co-inventor, Ingenio Pay Per Call Advertising Platform
San Francisco, California

When the Internet emerged, cost-per-thousand banner ads were the prevalent model. It was a bust. In 2000, pay-per-click took off. Change the model and baboom: Today, 35% of online spending is pay-per-click. Now we're ready to change the model again. Pay-per-call is going to crack the code.

The problem is, pay-per-click isn't suitable for businesses in local markets. Roofers, plumbers, auto repairmen, cosmetic surgeons -- most of them don't even have Web sites. They don't need clicks, they need calls.

Local Google and Local Yahoo are drivers for pay-per-call, not competitors. They deliver traffic. But they're in a different business; they're great at connecting server to server via one click. We connect people in real time.

This isn't something the faint of heart should get into. We've invested five years and $50 million in the platform. Here's how it works. When you type keywords into a search engine, they get passed on to us. We determine the category and serve back the appropriate merchants with a unique, trackable 800-number. Because the number routes through us, we can charge the merchant when a customer calls.

We created a marketplace of attorneys, psychics, computer assistants. Customers pay these businesses for intangible goods. All we had to do was change the direction: Have the business pay to acquire the customer. Businesses love it because they don't have to pay beforehand. They pay after it has worked.

A Jupiter Research study commissioned by Ingenio found many businesses would pay anywhere from $2 to $35 for a call lead.

A Better Yellow Pages

Kendall Fargo

Cofounder, CEO, and president, StepUp.com
San Francisco, California

We don't compete with Google or Yahoo or any of those guys. If you're doing a research paper on monkeys, they're great for that. They search what's on the Internet. We're not trying to do that.

I was in e-commerce for 10 years. I'd be at a cocktail party and someone would say, "I've got a small business, how do I use the Internet to sell my products?" There weren't any good answers. Meanwhile, advertising in the Yellow Pages is a $14.9 billion business in the United States, but we all know how frustrating they are to use. I figured there had to be an easy way for businesses to make their inventory visible over the Internet.

More than 70% of small businesses -- 1.2 million -- use QuickBooks. So we've designed a product that automatically extracts inventory information out of QuickBooks. Say you own a golf shop. If a customer is looking for a Callaway driver, we'll be able to search your inventories and tell that customer how many you have in stock, how much they cost, and where the store is.

We started the company in February with $150,000, and we've been with our heads down since. We just launched the beta on August 9, and the public response has been incredible. Businesses love it because it's free for them to submit their inventory. Customers love it because oftentimes they just don't want to order online. Maybe they want to see it in person before they buy it. Hey, maybe they can buy it on the drive home from work!

According to Jupiter Research, 87% of small businesses in the United States do not use the Web to sell their products or services.