Citysquares, after roughly two years in the greater Boston area, has decided it’s time to expand to “adjacent markets.” Those include greater New England and New York. CEO Ben Saren told me that the company would not be doing any direct ad sales in those markets (unless or) until it crossed certain traffic thresholds.
Saren says that Citysquares has successfully developed sales and pricing practices in Boston that it can translate into other markets, built on inside sales. The company has a small number of sales people but says it’s had success in both selling and retaining SMB based on fixed-priced packages and later upsells to things like video, which it outsources to TurnHere.
Part of the move is based on the fact that Citysquares thinks it has established something of a formula for sales and part of its expansion is based on a sense that the company needs to stake a broader claim in this regional market.
Peter Krasilovsky is reporting that Citysquares currently has 700 advertisers that pay $1,200 per year (citing Saren). That’s comparable to what Yodle and ReachLocal are seeing, although ReachLocal’s monthly averages may be somewhat higher.
Saren said the major factor that differentiates Citysquares from its competitors is its truly local and neighborhood focus.
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Correction: ReachLocal sees $1K+ on average per month, not per year. My bad.
June 9, 2008 at 7:21 pm |
I’m curious how Citysquares is able to get local businesses to pay $1,200 a year. What, exactly, are the getting for that money? Citysquares reportedly gets 70,000 users a month along with $70,000/mo in revenue (700 advertisers x $100/mo). That means they are monetizing their site at an astonishing rate of $1000 per thousand visitors! Even local search companies like Local.com only monetize their traffic at the rate of about $250 per thousand visitors. Something seems a bit off to me…
June 9, 2008 at 7:24 pm |
Those numbers are from Peter. I didn’t confirm them from Ben.
June 9, 2008 at 8:57 pm |
I’m not sure about the other sites mentioned, but I think Citysquares benefits greatly from being sooooo locally focused on a single market. That focus probably limits their overall revenue (hence, their plans to expand) but also probably creates a premium.
June 9, 2008 at 9:02 pm |
Yes, that’s what Citysquares has said to me about their content; it’s “hyper local” nature is a differentiator.
June 9, 2008 at 11:54 pm |
Of course, I meant Citysquares. Sorry for the mental typo…
June 10, 2008 at 4:04 pm |
From my experience, the cost per SMB they are seeing is about average.
I don’t know their product mix but I’ve seen others sell the business profile alone from $59-$149 per month and then add on additional cost for Local SEM products as well as managed PPC on the major search engines.
Top tier local businesses (Restaurants, Service, Legal) will spend much more than $1,200 a year on local search/business directory initiatives.