Hyperlocalization and finding advertisers

Here's an article about the struggles of Backfence, a company going after local markets with citizen journalism. The company raised $3 million, which, if doled out very carefully, should sustain them for awhile.

Any website that depends on advertising income will have a tough go of it. There are way too many websites competing for too few ad dollars.

Hyperlocal websites as a way to attract support for live music makes sense because it reinforces the idea that music venues, if done right, can enhance neighborhoods.

But a traditional advertising pricing system, based on cost per thousands, is not likely to be appealing because numbers for hyperlocal sites will be relatively low. More creative integrated marketing plans are a better approach.

For Local News Site, Model Just Didn't Click - washingtonpost.com, 1/15/07: "Most community news sites like Backfence, which rely on reader-generated content to draw advertising dollars, are still trying to make a profit off 'hyperlocal' Internet publishing. Strings of neighborhood sites haven't been able to attract enough users to persuade advertisers to bank on such targeted media outlets, analysts said...

Media analysts agree that many readers are looking for hyperlocal content, but they say most citizen-journalism sites aren't mature enough to tap into the lucrative local advertising markets.

'Realistically, it's going to take close to 10 years for the business models to be there and for there to be enough advertisers willing to give money to hyperlocal start-ups,' said Vin Crosbie, managing partner of Digital Deliverance, a Connecticut media consulting firm. 'Backfence's problem is that it was too early.'"

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