I’ve grown to the believe that there is a huge opportunity in the area that ReachLocal is targeting… there is so much advertising money floating around in the local markets and until recently so little attention being paid to servicing brick and mortar retail folks who just have a few thousand dollars a month to spend on digital advertising.

While Google is now up to something like 1.5 million advertisers, and has done a great job of servicing the long tail of online oriented advertisers. It’s the long tail of offline advertisers, which is proving to be a bit tricky to convert to online, not just because they’re the long tail and there are tens of millions of them, but they don’t live and die by traffic to their website… heck many don’t even have websites and can be pretty ambivalent toward the whole thing!

One of the newest companies to pop up on my radar screen in this area is a company called Paper G recently started by some Yale and Harvard students.  Paper G is focused on the digital display advertising space and one of their products PlaceLocal is trying to solvea familiar problem for this market which is how you make it super easy for folks with very little time, digital resources and digital wherewithal to develop and run digital display ad creative. 

The PlaceLocal product greatly simplifies the process of making an online display ad. I gaveit a trial with a popular burger joint, Five Napkin Burger, that opened a new location on the Upper West Side a few months ago.  Essentially all I had to do was type the name of the business and the city andPlace Local did most of the rest.  After typing in “Five Napkin Burger” and  “New York” PlaceLocal first found the business (ok so it was really the old location in Hells Kitchen, but I give them credit there anyway) and one click later it was busy scraping the web or hitting various APIs to find stuff to  put into the ad. While I waited a minute or two for it to do its thing, I must admit that I was pretty skeptical that it could be this easy and still be good, but I must say the result was pretty damn impressive.

After more than a few minutes of whirling ‘working’ icons… woo hoo it had found a bunch of content to use in the ad!  At this point you get to pick some VERY basic components to put in your ad like the logo, the design style and click through URL and PlaceLocal populates the rest with a slick flash movie full of restaurant images, menu images, and snippets from reviews from popular restaurant review sites like Yelp. 

There were a few hiccups with my trial run with Five Napkin Burger… PlaceLocal couldn’t come up with a logo so I had to crop the company name out of another image, but it was super easy to do with the tools provided by PlaceLocal.  And while at first pass most of the reviews selected were stellar there is one looping through that disses the endive leaves on their burger, and another Yelp snippet which simply says “a perfect side for this perfect burger” with no reference to what that side may be.   Fortunately they have great tool so you can easily get back in there and see the whole review and then edit what appears in the snippet in the ad.  In fact their tool for messing around with the assets that go into the ad were pretty good… you can add various photos and change things like business category and hours etc… and the whole thing is vey well designed to make it powerful enough to change many of the things you wanted to change without introducing too much complexity to the process.

Once the ad is created you can buy into three simplified buckets of media buying with spends ranging from $300 to $1,000 at what works out to about a $15 CPM.  

I am not sure how much traction they’ll get as a stand alone place to create and run local advertising but as a tool for easily creating local oriented ads the product does very, very well.  So it’s not surprising to see local newspapers and folks like Time Out New York flocking to check out their service as a valuable tool for their sales force selling their own owned and operated sites.  Over time too many of the similar format of intertwined user reviews and photography in a flash movie may begin to get old, but I suspect that they can develop some new templates to keep the ad creative options fresh and flexible.

It shouldn’t take long before folks like CitySearch, ReachLocal and others take notice and try to rip it off or partner with these guys.

Now in the olden days when you just bought a printed foldable map this didn’t really matter much, but nowadays in the modern inter networked world of digital maps and folks creating a dizzying array of new services helping connect people with locations, it matters more.  Now within a single stand alone application like say a TomTom navigation device there is probably not much thought put into what you name a place, but in the web2.0 world where interoperability and information sharing reign, everyone needs to know what location everyone else is talking about when someone is talking about the business at 4151 North Central Expressway.

So rather than just getting everyone to try to agree on a standard, which could take years and years and would probably be a lot like herding cats, Placecast has announced today that it has developed a technological solution to the whole problem and they’re opening it up for free use.

The product is called the Placecast Match API…. and it’s described as “a Rosetta Stone for location data”. For those that need a refresh on their ancient Egpytian artifacts, this basically just means that they will provide a way to translate between the different “languages” that different services use to describe locations for the purposes of enabling interoperability between those services.

There is a great article on Tech Crunch that demonstrates how this problem manifested itself in the hot area of mobile social networking and the battle of the check-ins where folks may want to check in somewhere on a number of different services without having to fire up each service independently and do it manually. Given the viral and social nature of services like Foursquare and Gowalla, I guess it’s not surprising that this is where we’d first see the need for better interoperability between services.

One area where this is particularly interesting is around the area of location based advertising. One of the things that needs to happen to help ramp up growth in this area is more scale in order to make hyper local and location oriented advertising finally get on the radar screen of folks that control advertising dollars. It’s not that there are not a lot of consumers using these types of services today, there are… but usage is spread around among a lot of player.  Consumers may look up directions via Google Maps, Yahoo Maps or Mapquest, others may rely on their Garmin or TomTom devices, while urbanites without cars may just be checking in with FourSquare, Goawalla or Loopt or using one of a hundreds of local discovery services like UrbanSpoon, Yelp, Where, Geodellic, etc.

The amount of traffic to any one hyper local area on any one of these systems is likely not significant enough to create a media buy, but centrally tether them all together with a common reference point and pretty soon you have what begins to look like the beginnings of a network… a point of interest advertising network. 

Putting banners in apps and on wap pages is one approach to the location based advertising opportunity, but there certainly seems to be just as much opportunity if not more around “listings ads” connecting mobile users with the businesses they’re looking for from mobile search and discovery services and then capturing, sharing and aggregating the related check ins at scale across the ecosystem.

I am not saying that this is the Placecast end game, but something like the Match API and other similar offerings by competitors certainly seem like it could help spawn competitors to what folks like CitySearch are doing with CityGrid around the creation of ad networks tied to places.

What will be interesting  is to see how publisher view participating in such a system and the more thorough socialization of content from their system… when the depth, richness and accuracy of that content may be a significant source of unique competitive advantage.

Back in April of this year Local Search News did a great piece on the local business opportunity for Twitter and it seems that this is the first big announcement I’ve seen yet in that direction.

What does the integration of Twitter on CitySearch include?  Well business will be able to include an existing Twitter account, or create a new business specific account, through their CitySearch profile set up. Once set up: 

• Consumer will see a stream of recent tweets related to the business posted with a one minute delay to the web…. sandwiched between the original editorial and consumer reviews on the business profile page.
• Consumers will have the option to look at the full listing of the last 100 tweets related to that businesses twitter name
• A new feature on its way will pull out common words from tweets for a particular business in order to synthesize the sentiment or common themes without users having to read through hundreds of tweets.
• The fresh ‘content’ also has the potential to boost the visibility of the CitySearch profile pages among search engines.

This seems like a great move for both sides. As a leader in its field CitySearch is always looking for new ways to offer more and more information and tools to its users, and Twitter provides a unique new real time supplement to the longer form reviews that currently help make CitySearch stand out.  Is a restaurant packed tonight, or did Madonna just show up? The existing web reviews system just wasn’t a good solution for that, but Twitter is.

For Twitter this is a significant move into the arena of potentially useful commercial applications of their technology with the leader in the online city guide market. 

It will be interesting to see how successful the filtering and parsing technology works… from my experience there are a few gem tweets in a stream, but often a huge number of largely useless tweets as well, if not downright spam, so helping filter through and letting the genuine and useful ones raise to the top may be key to its usefulness.

While there is no specific location technology at work here, everything about this deal speaks to creating place specific digital information, which is likely to be largely created by and for folks directly in the vicinity of the place. In fact, if there is an algorithm helping to control what tweets are shown, I would hope that they seriously consider factoring into the equation the physical proximity of where the tweet was created in order to give more weight to those actually at the location.

I think that this may take six months of fine tuning, but I think it has the potential to be a huge hit.