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Local.com's position as a leading pure-play local search engine places the company at the forefront of the growing local search advertising market.
America has a consumer economy. Research shows that consumers typically spend about 80 percent of their income within 50 miles of their homes, and that about 30 percent of all Internet searches are commercial in nature. In fact, fully one quarter of all searches on the Internet are for both local and commercial content. These consumers are the crown jewel of search because they typically convert into buyers at a higher rate than any other type of online search traffic. As a result, advertisers often pay a premium to place their ads in front of consumers conducting local searches. Researchers forecast that a growing number of local businesses will begin to advertise their products and services through online search in order to reach these highly valuable consumers. These efforts to reach targets at the advanced stage of the buying process will drive the projected growth in local search advertising.
According to The Kelsey Group, the total volume of online advertising in the United States will grow at a compound annual growth rate of 18 percent, to about $26 billion in 2010. This will represent as much as eight percent of total advertising spending during that period. This growth rate should accelerate because many large businesses that utilize traditional media are expanding online advertising, including paid search, to reach today's computer-capable audiences. Total online advertising revenue set a record of $12.5 billion in 2005, a 30 percent increase from the previous high of $9.63 billion in 2004, according to the Interactive Advertising Bureau.
There are over 10 million businesses in the U.S., but only about 5% currently participate in search advertising. The adoption of this highly effective form of advertising by this large market is expected to drive the projected 43% compound annual growth rate in local search advertising, from $1.6 billion in 2006 to $6.2 billion by 2010. The Kelsey Group also projects that local search advertising growth should outperform all other forms of online advertising during this period.
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#4 in pure-play local search - comScore July 2006
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2009 Local.com Corporation
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