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Independent Cities Gain SteamProduct Type: Market Research ReportPublished by: Borrell Associates Inc. Published: December 2005 Product Code: R2670-11 Description Feverish growth in online advertising has spawned a new crop of local Web site competitors. They are elbowing in on territory that traditional local media properties have been trying to stake out for the past decade, but they are using a decidedly different model. These competitors couldn’t care less about local news headlines, obituaries and Doppler weather reports. They shun the drudgery of repackaging local news and information, and instead focus almost exclusively on fun and interesting things to do around town. While local media home pages in San Francisco lead their pages with crime news and updates from Iraq, SanFrancisco.com leads with nightlife, dining and attractions.
The strategy is beginning to pay off. Many independent local sites are reporting revenues well into six figures, with respectable margins. About 20 owners of City.com URLs banded together recently to form their own trade association. A flurry of acquisitions has begun as well. LocalMatters.com recently secured a $20 million investment that it will use in part to buy AreaGuides.net, a large network of city guides. South-Carolina-based Information Centers Inc., a network of 16 city sites, recently paid $500,000 for a City.com URL and has a standing offer of $5 million for another. And a Las Vegas newspaper publisher offered $12 million for LasVegas.com. Independent sites tend to have a fraction of the traffic and revenue of competitors who are financed and promoted by traditional-media outlets, but the underdogs offer an interesting lesson: Keep it simple, keep it upbeat, and don’t forget the out-of-market traffic. They are focusing on sites that win attention from locals and travelers alike, and are tapping ad revenues from some of the largest spenders on interactive advertising: hotels, casinos, airlines, real estate agents, resorts and restaurants. Table of Contents Executive Summary Chapter 1: Independent Local Sites Gain Foothold Chapter 2: What They’re Worth, What They Make Chapter 3: Competition From Above and Below Conclusions CHARTS & TABLES Figure 1. Toledo.com Appears in Top 10 Local Sites Figure 2. Dallas.com Focuses on Travel Figure 3. MyrtleBeach.com Focuses on Recreation Figure 4. PalmSprings.com: Location, Location, Location Figure 5. Associated Cities Member Sites Figure 6. Differences Between Traditional Media Sites and Independent Local Sites Figure 7. City.com Site Rankings on Keyword Searches |
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