by Tom Kaneshige

Is the time finally right for hyperlocal?

News Analysis
Mar 30, 20154 mins
CMOMarketingSocial Networking Apps

The concept of AOL’s Patch sounded great, but the trail of inactive Patch sites shows the business model was flawed. But maybe its hyperlocal approach was ahead of its time, because it’s exactly what marketers are starting to do today.

hyper local
Credit: Thinkstock

Who can forget those early online publishing days when hyperlocal content seemed all the rage? Internet granddaddy, AOL, planned to stitch together “Patch” sites across the country to cover local news, which bankrupted, dead-tree publishers could no longer provide. Legions of underserved local advertisers were supposed to flock to Patch sites, leaving national publishers in the collective dust.

Of course, this wasn’t how it played out. Scores of Patch sites were left inactive as the a company reexamined its strategy. Sure, hyperlocal content sounded great — everyone wants to know what’s happening around them — but the flawed business model couldn’t sustain it. Not enough big advertisers were targeting local markets.

Was hyperlocal just hyperearly?

Then again, maybe hyperlocal was simply ahead of its time.

“When we think about the future of the media industry and news, the question is, what survives?” says Antonella Mei-Pochtler, senior partner at Boston Consulting Group. “People will only be driven to consume and pay for content that is highly relevant, and that’s mainly local content. It’s also true for marketing and advertising.”

In the annals of doomed tech, smart offerings failed because they were too early to market: Apple Newton (1993), WebTV (1995), LiveJournal (1999), Friendster (2003), to name a few. As the tech industry likes to say, being early is the same as being wrong. Perhaps Patch’s launch will be remembered in a similar way. Patch really needed national brands, not only local restaurants and shops, to think digitally and spend locally.

Yet this is exactly what marketers are starting to do today, steering their content-generating resources toward social and mobile. These mediums naturally play well to the local crowd. Marketers at national packaged goods companies, for instance, can sponsor local events and participate in the endemic conversations happening over social networks and in the local media with hyperlocal content, subtly imprinting their brands, as opposed to banging away on the one-size-fits-all messaging drum or banner ad.

A hyperlocal vision: it aint cheap

Here’s what it might look like: An energy-drink company sponsoring a local marathon can join or even drive conversations leading up to the event. The marketer runs a series of native advertisements in a local news site or Facebook feed about ways to train for the marathon, a special workout routine with the marathon only weeks away, and tips on diet in the days before the event. Essentially, the marketer rides the hype and peaks on the day of the local event with the message, “Are you energized?”

“You need to get into the local conversations,” Mei-Pochtler says. “This means you need to have some native advertising or other original content that goes into their conversation. You need to reach out to the people in those communities who are talking about your category and build a network of communicators.”

[Related: Mastering the subtle art of content marketing]

When it comes to hyperlocal content marketing, the elephant in the room is the enormous costs required to pull it off. Hyperlocal ain’t cheap. The manual labor needed to deliver native advertisements aimed at local events across the country would swamp even the best staffed marketing team. The answer, Mei-Pochtler says, is the availability of platforms to create, distribute and manage hyperlocal content in a more automated way.

Tech vendor Nativo provides automated distribution of native advertisements for more than 300 brands to some 300 publishers, including Time, WebMD and the Wall Street Journal. Moreover, Nativo analyzes results and conducts AB-testing on everything from headlines and images to various times of delivery for each publisher and local market, in order to optimize native ad performance.

“We’ve done hundreds and hundreds of campaigns across tens of thousands of places, and we have hundreds of millions of impressions going every single month, in terms of ad serving volume,” says Nativo CEO Justin Choi. “There’s a big macro-trend in advertising right now: Brands are re-thinking the decades-old [tradition] of interrupting the consumer with their message to how to engage the consumer.”

Clearly, marketing content is starting to target hyperlocal markets; maybe it’s not too late for Patch. The nature of marketing content is changing, too. Banner ads are being replaced by content that contributes to a hot-topic conversation. Marketers not only learn about a consumer’s most important interests, this new kind of marketing content treats consumers as people with which to have a real relationship rather than as merely sales prospects.

“Hyperlocal is about being more relevant content-wise and being more near to the consumers,” Mei-Pochtler says.