6 reasons why JustDial is harming Indian businesses

This blogpost has been sitting in my inbox for two years now, awaiting a final read-through and edit. Since then JustDial bagged a Rs. 300cr round from investors and followed up with a successful IPO. Unfortunately, all my concerns about JustDial from two years ago hold just as true now as they did then, indicating that little progress has been made by the company in the space of search integrity and transparency.

JustDial is ubiquitous in India. In the last fifteen years of its existence, JustDial has aggregated exhaustive listings of every corporation, restaurant, shop and business establishment in the country and made this information available to users with a simple phone call.

For a country that has embraced the mobile phone faster than it has embraced the web, JustDial provides a unique alternative to Western business aggregators such as Google and Yelp. The small businessman or self-employed service provider like your local grocer, plumber or chaiwalla need nothing more than a mobile number to ‘get on the map’ and get unprecedented exposure to customers.

According to an interview with founder VSS Mani in 2012, JustDial receives upwards of a million search queries on a daily basis of which 60% come from web-based queries (presumably most of the other 40% queries originate from the phone). Furthermore, JustDial has over 7 million business listings from across the country, of which a significant portion are paying customers.

If we also account for the popularity of JustDial’s clones such as askLaila, Hudku and AskMe, we can safely assume that the average Indian consumer is performing her business search queries on JustDial and its peers before going to a web-based search engine. Similarly, the average Indian business owner is listing himself on JustDial before trying to get an online presence.

This is worrisome.

JustDial is perpetuating a search model which relies on unethical practices that are damaging to business owners and users. Here’s how –

For sale: Search relevance

Ranking on real search engines is based on an algorithm that takes into account the relevancy of the result against the user query. For example, Google’s PageRank rates the popularity of a webpage based on the number of external links pointing to that page (ref). Aggregators such as Zomato and Yelp account for attributes such as user ratings, distance from user, keywords and tags associated with the business to determine its search ranking.

JustDial’s search algorithm (if you can call it that) is weighed by one factor alone — paying customers. Businesses can buy search ranking for certain ‘keywords’ in a geographical location, ensuring that their listing is displayed for a search query using those keywords. For example, a hardware store in Andheri West could purchase the first search result for all queries associated with ‘plumbing’, ‘hardware’, ‘construction’, ‘paint’, ‘tools’, ‘cement’, ‘equipment’ in the Colaba to Ghatkopar region, ensuring that any user who queries with those keywords will always see their listing. JustDial doesn’t verify the authenticity, quality or relevancy of this business listing nor does it concern itself with other listings that might be more relevant to the query.

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Guess which one is a paying customer?

2. For sale: User information

The second and more serious way JustDial violates user trust is by selling user information to the highest bidder. Every time a user calls JustDial / searches on JustDial.com whilst logged-in, JustDial sends that user’s phone number, email address and name to over 10 businesses who have purchased user information for those keywords.

These businesses are now free to call or SMS these users repeatedly. They are free to add their email addresses to their subscription list. Furthermore, with the user’s first name and email address at their disposal, are free to find them on social networks and target further marketing towards them. Did the user consent to these violations when she called with a simple query?

The moral equivalent of this would be Facebook selling your name, relationship status, phone number and home address to every person whose profile you visit.

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A customer’s name, location, phone number and email address sent to a business by JustDial

3. A questionable review model

One of the biggest user benefits of a business search website is the ability to gauge the quality of an establishment based on reviews from its prior customers, helping users make an informed decision about where to bring their business. Reviews force businesses to provide better service to existing customers at the cost of future customers.

A well-implemented review model encourages users to review businesses and ensures the authenticity of the review with user profiles. Highly-reviewed businesses then rise in search prominence and poorly reviewed ones fall.

JustDial makes no such effort with reviews. One-word reviews, forced out of phone users by the Justdial call center employees , form the bulk of the reviews. Without user profiles, there is no way to verify if these reviews originate from users and it is entirely possible that they are being fabricated to lend legitimacy to paid listings.

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JustDial reviews for a business listing. WTF?

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Zomato reviews for the same listing

4. Justdial enters the transaction market

In a very telling quote, JustDial’s founder VSS Mani claims in an interview In the Gold Rush, the guys who made money were the guys who were the ‘enablers’, the ones who sold the shovels… not the ones who dug for the gold.” What if the guy who owned the only shovel store in town decided to stop selling the shovels and get in the gold-digging business himself? Who will find the gold now?

In a similar move, JustDial is slowly entering the services and transactions market where it offers more than the business listings, it offers to complete the user request with the business listing. For example, if the user was looking for flower delivery in the Bandra area, JustDial can now accept the order, match it up with a flower delivery business, take the payment and complete the transaction.

As it grows more popular, this model will skew paying customers towards businesses who opt-in for JustDial to provide services on their behalf (and let JustDial take a bite of the transaction cost), actively taking customers away from other businesses who do not want to opt-in.

Since, JustDial controls the funnel through which most business queries in India go through, they can choose which way to direct the flow.

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Flower delivery from JustDial

5. Phone > Web

Let’s take a second to consider JustDial’s business priorities.

Given that a major source of JustDial’s revenue comes from selling the user’s phone number to businesses, it is in JustDial’s best interests to keep user queries on the phone where they can collect their mobile number as opposed to user queries on their website where users are anonymous.

Perpetuating the traditional call center model suits their bottom line more than a web presence does. This incentivizes JustDial to keep their web experience subpar (which is self-evident from the quality of their website) and keeps them from investing in basic web features like maps and search. And if you do land on their website, JustDial makes sure to request your contact info at every search query.

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Mr. Bachchan, the ultimate wingman.: Amitabh wants you to give JustDial your phone number.

6. An unchallenged monopoly

JustDial has long crossed the Tipping Point where it went from being a service to call for a few business listings to the only service to call for all the business listings. As the biggest player in the market, JustDial has created an environment in which a business cannot be competitive if it is not listed on JustDial and is paying for search prominence against its competitors, who in turn are paying JustDial to one-up each other. The only winner here is JustDial.

This is a market with an immensely high barrier of entry, where the costs of duplicating an existing business database are prohibitive for a new comer. As a result, JustDial has established a monopoly, and will continue to be one for the foreseeable future.

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Selling search relevance and user information is not unprecedented. Advertising is the primary source of revenue for all other search engines like Google, Bing, Yelp and Zomato. However these websites clearly distinguish their unadulterated content from their paid content, giving users the option to withhold personal information and to block out the ads without worrying about the real content being polluted.

A JustDial search result, on the other hand, is about as clean as the Mithi river.

Originally published at tanvisurti.wordpress.com on February 9, 2014.

Written by

Uber Product | ex-Microsoft | ex-Startup | Book Worm | Feminist | Bollywood connoisseur

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