MySpace is moving to the neighbourhood.
The social networking giant today announced a deal to emphasise searches of local restaurants and the like, with reviews of those businesses by a user’s friends getting prominent billing.
The idea is that those businesses, or their rivals, might feel compelled to respond with advertising or special offers. It’s a formula that’s worked for Yelp, a smaller Web company specialising in local reviews.
MySpace will rely on listings from IAC’s CitySearch to seed the process, and the two companies will split the resulting ad revenue.
MySpace CEO Chris DeWolfe said an open test version of the feature will be offered in a few weeks, and that it will start with dining and nightlife establishments.
“You can envision a day where people can pick anything they’re interested in,” then have relevant reviews by friends appear as automated updates, DeWolfe said.
In the nearer term, MySpace is envisioning profit. The growth in internet advertising is tailing off, and archrival Facebook is adding more users and developers.
MySpace has been trying to recapture momentum and ad dollars with hyper-targeting users based on the interests they disclose on their profiles. It has gotten into more “verticals,” trying to round up a good audience for the likes of car ads with discussions devoted to those topics. And it has gone a bit local before, selling ads to smaller businesses that only run in their geographies or are pegged to gender or age range.
The CitySearch deal takes that initiative further, marrying the power of social networking to mainstream local commerce.
“What we do is take a mass communications platform and deeply integrate it with a deep social platform,” said MySpace sales and marketing President Jeff Berman. “I can post a picture from my barbecue, a song from Springsteen, or a review of a restaurant down the street.”
For users, the system should provide an easy way to follow the advice of people they trust on food or bars, instead of relying on the wisdom of the crowd.
“People ask their friends `where should I go for dinner,’ so it makes sense to tap into that. It’s very appropriate,” said digital startegy consultant Chalrene Li of Altimeter Group.
Facebook has a system that alerts friends to each others’ activity on many sites, including CitySearch, if users log on with their Facebook identity and approve the transmissions, but Li said the MySpace arrangement goes further. Yelp and Facebook declined to comment.
Both approaches make sense—but neither, by itself, will get Facebook much closer to an IPO or MySpace out of the “other” category on parent News Corp.’s earnings filings.
