Are Local Websites Profitable? (WOW)

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  • Join @goborrell and @abbysineni for a Webinar, today at 2 pm ET, to discuss findings from Benchmarking Local Online Media: 2012 Revenue Survey. http://www.borrellassociates.com/component/virtuemart/?page=shop.product_details&flypage=garden_flypage.tpl&product_id=1146
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Are Local Websites Profitable? (WOW)

  1. 1. Selected Charts &Information fromBorrell’s 11th AnnualBenchmarking Report April 2013 © 2013 Borrell
  2. 2. Introduction The following slides offer a summary of Borrell’s 11th Annual report, Our Foundation: Research“Benchmarking Local Online Media,” published on April 11, 2013. The report contains analysis of revenues and expenses from 6,284 local digital ventures in the U.S. and Canada, as well as a survey of digital managers and online ad-spending data from 513 U.S. Digital Marketing Regions (DMRs). The full report costs $995 and can be downloaded at www.borrellassociates.com. Illustrations and information in this presentation may be used with attribution to Borrell Associates. © 2013 Borrell
  3. 3. Growth Isn’t Abating for Local Online Ad Spending Our Foundation: Research Local Businesses spent $18.5 billion on digitaladvertising in 2012, 20.5% more than the previous year.In 2013 the number is trending toward $24.3 billion, for a 31.4% growth rate. © 2013 Borrell
  4. 4. Local Online Advertising, 2004–2013 © 2013 Borrell Source: © Borrell Associates, Inc. 2013
  5. 5. Who Gets All That Money? Our Foundation: Research Pureplay companies dominate, with 47% of market share.That’s because there are so many of them: Craigslist, Weddings.com, Autotrader.com Angie’s List, Yelp, Yext, ReachLocal, Monster, Groupon, Marchex, Local.com…. Perhaps two dozen getting small chunks of share from each market. © 2013 Borrell
  6. 6. How $18.5 Billion Was Shared In 2012 © 2013 Borrell
  7. 7. Clear Pattern: Local Businesses Prefer Digital Our Foundation: Research Consumers over ‘Readers’The Top 20 list of companies in the local digital space is dominated by those who have nothing but advertising as their content, trumping traditional news & information sites. Even though Gannett, a “news” company, tops the list, 60% of its digital revenues are not from its news sites. © 2013 Borrell
  8. 8. Top 20 Locally Based Competitors *Some overlap in revenues occurs for CareerBuilder and Classified Ventures because both are owned by Gannett, McClatchy and Tribune, which also appear on this list. © 2013 Borrell Source: SEC Documents, company statements, Borrell Associates Inc.; April 2013
  9. 9. Our Foundation: Research Digital Growth ForNewspapers Is Low © 2013 Borrell
  10. 10. Newspapers Online Rev. Growth, 2004–2013 © 2013 Borrell
  11. 11. ButOur Foundation: Research They Average 50% More Digital Revenue Than Local- Market Competitors.Why? Because they got in the game early, leveragedlarge local ad-sales forces, and focused on classified advertising, which migrated to the web fast. © 2013 Borrell
  12. 12. Who’s Making What: Avg Per-site Revenue © 2013 Borrell
  13. 13. Our Foundation: ResearchTV Stations’ Digital RevenueContinues to Grow – Maybe As Much As 26% in 2013. © 2013 Borrell
  14. 14. TV’s Local Online Ad Revenues © 2013 Borrell
  15. 15. Our Foundation: Research Local Radio’s Growing, Too... But is Nowhere Near theBillions that TV and Newspaper Competitors Make. © 2013 Borrell
  16. 16. Radio’s Local Online Ad Revenues, 2004–2013 © 2013 Borrell
  17. 17. Our Foundation: CentersBut the REAL Story Research Around This Number: +49% © 2013 Borrell
  18. 18. Our Survey Found:The average EBITDA* for traditional media company Our Foundation: Researchdigital ventures is 49%. They don’t account for rent, advertising or contentfurnished by their host media company. Many pureplays (who do account for theseexpenses) are making 20% to 30% margins. There’s a high level of confidence (96%) in theaccounting. * Earnings Before Income Taxes, Depreciation and Amortization © 2013 Borrell
  19. 19. Want More?We can’t give everything away!The report spans 45 pages and includes 37 charts andgraphics (we showed you just 7 of them here).It also includes a list of all 513 U.S. Digital MarketingRegions (DMRs) and how much businesses spend onvarious forms of digital advertising in these locales.For the full report visit www.borrellassociates.com © 2013 Borrell
  20. 20. Talk to Us! We’d love to hear from you.Call us: 1-757-221-6641Email us: info@borrellassociates.comFollow us: @borrellassocGet head’s up on our research: www.borrellassociates.comJoin the LinkedIn debate: Local Advertising & Marketing Trends Borrell Associates Inc. 1643 Merrimac Trail Williamsburg, VA 23185 © 2013 Borrell

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