Today at BIA/Kelsey’s ILM East conference, outgoing Citygrid Media CEO Jay Herratti gave a retrospective view of the past five years of local media — what has worked and what hasn’t. He also didn’t miss the opportunity to make some predictions of what will drive the next big winners.
Herratti reminded us of a few classic local challenges such as scaling advertiser aquisition in the face of fragmentation. This is shown by the fact that no one has definitively “won” local, despite lots of activity and product introductions in the last decade.
“In local, every two people have three opinions on everything, such as what will win in mobile payments,” he said. “We are still arguing about what is working and not working because we still don’t know. It’s still a work in process.”
31 Flavors of Local
The subsectors of local grappling with these common challenges include deals, lead generation, local search, local listings, geo-social, local verticals, transactions, Web hosting & presence, reputation management, etc.
There are leaders in some of these subsectors such as Yelp in the “places” space, and Google in local search (via scale). We also see emerging players like Yext in presence management (Maybe the answer lies in the “Y” initial).
One of these subsectors where CityGrid now hangs its hat is location based ad placement. This is the local ad network space — which also include players like AT&T interactive — aiming to be the “AdSense of Local.” It has one-stop shop appeal and aggregation of fragmented ad inventory.
“The only way to acheive scale in local is by aggregation,” said Herratti, in support of the company’s pivot two years ago toward this local ad network model.
Going beyond these main subcategories, Herratti outlined his view of the next emerging trends that will drive innovation accross the local space, and get us closer to categorical solutions of these traditional local media challenges.
1. “Big Data”: (Factual, Localeze, Infogroup, CityGrid)
2. Loyalty: (Punchcard, Shopkick, Stampt, Punchd)
3. Proximity Marketing: (Thinknear, Where, GrouponNow, Placecast)
4. Mobile Payments: (Square, Google Wallet, PayPal, credit card companies)
5. Peer-to-Peer: (Taskrabbit, Zaarly, Airbnb, Getaround)
The last one is interesting not just because of Pinterest’s insane usage growth, but because it’s still an open book when it comes to local applications. Herratti points out that Facebook wasn’t much of a local play at first (besides being geographically oriented around college campuses), but look at it now.
“Anytime something attracts users so quickly, it will end up being local,” he said. “I bet there is a company right now in New York or San Francisco pitching the ‘Pinterest of local,’ using interface or principles that Pinterest has put together.”