Local Corporation (the registered trade name of Local.com Corporation) is a local media company operating at the intersection of consumer demand for local products and services and advertiser demand to reach those consumers.
Consumers today rely on the Internet and mobile devices to find products and services while decreasing the use of traditional offline information searches (such as Yellow Page listings). The Internet is estimated to influence over $1 trillion of in-store sales. Roughly 86% of in-store shoppers use search engines to gather information for a purchase decision (Source: GroupM Search’s From Intent to In-Store: Search’s Role in the New Retail Shopper Profile, October 2011).
An increasing number of these searches are for local businesses, products, and services. Currently, roughly 20% of searches on Google.com are related to location. The proportion of local searches is even higher on mobile devices, representing 40% to 50% of all searches.
As a result, in 2010, digital advertising accounted for $20 billion, or 14.6% of the $137.2 billion advertising industry in the U.S. By 2015, online sources are expected to represent $38 billion, or 25.4% of all advertising.
Local Corporation’s websites and networks provide consumers with robust, current information about nearby businesses and other offerings in their local area, attracting a targeted and desirable audience for local advertisers. Collectively, the Company’s websites and those it operates on behalf of its partners reach over one million unique visitors daily.
Local Corporation is focused on expanding the portion of website traffic obtained organically through effective search engine optimization (SEO), which has a higher profit margin than website traffic acquired from other search engines. Today, organic traffic represents roughly 40% of the Company’s traffic, and Local Corporation ultimately aims to achieve an equal ratio of organic and paid-for traffic.
Local Corporation monetizes website traffic by incorporating paid advertisements onto its websites. These ads are often provided by major ad partners, such as Google Inc. (GOOG-NASDAQ), Yahoo! Inc. (YHOO-NASDAQ), SuperMedia LLC (SPMD-NASDAQ), and YP Holdings (formerly AT&T Interactive), which seek to gain access to the Company’s local search traffic on behalf of their own advertisers. Monetization of Local Corporation’s site traffic was $299 per thousand visitors in the second quarter 2012.
The Company has demonstrated an ability to adapt to significant changes across the industry. After facing challenges as a result of the Yahoo!/Bing alliance in the first half of 2011, Local Corporation diversified its ad revenue sources among its major advertising partners (adding Google as a partner) and incorporating new proprietary products to its portfolio, with second quarter 2012 revenues up 75% year over year.
Local Corporation is focused on decreasing its dependence on search marketing revenues by expanding its portfolio of digital media products and services (internally and through acquisitions) and emphasizing direct-to-customer sales with an expanded internal sales force (versus reaching local merchants through partners).
Market research firm comScore, Inc. (SCOR-NASDAQ) estimated that 88 million mobile subscribers accessed local content on mobile devices in September 2011, a 28% increase over the year-ago period (Source: BIA/Kelsey, December 14, 2011). Addressing this large and expanding market, Local Corporation has launched a number of mobile sites and apps for its websites as well as those of its customers (for more than 19 million unique mobile visitors during the second quarter 2012—a 350% increase over the year-ago period). Local Corporation plans to expand its mobile offerings in the third quarter 2012.
Local Corporation’s management team has expertise in online advertising, digital media, technology, sales, and business development. In 2011, Local Corporation’s chairman and CEO, Heath Clarke, received the Orange County Business Journal’s Excellence in Entrepreneurship Award and was selected as a finalist for the Ernst & Young Entrepreneur of the Year® 2011 Orange County award.