After two years in operation, CitySquares hasn’t necessarily broken out of the box. But Beantown’s neighborhood-centric directory of local businesses has got about $1 million in venture funding; almost 400 advertisers paying roughly $600 a year, mostly for “deluxe” business profiles; and an 88 percent renewal rate.
In mid-October, CitySquares is going to re-launch using new neighborhood slicing-and-dicing capabilities from Urban Mapping and Localeze, all based on an open-source Drupal platform. The site is also confidently planning to expand beyond Boston, with another northeast city set for Q2 2008, and a third one for Q3.
Co-Founder Ben Saren says the site’s re-do reflects a key truism: hyperlocal is about neighborhoods, but the reality is that neighborhoods are often “in-between” other neighborhoods. The new version of the site is going to present searchers with the five closest neighborhoods, as well as proximity options. “They can be five miles or ten blocks,” he says. That’s the Localeze part of it.
They’ll also identify neighborhoods within neighborhoods, such as Observatory Hill, which is a section of Cambridge. That’s the Urban Mapping part of it. The ability to sell across neighborhoods will help sell ads for the many small businesses “in between.”
As for existing advertisers, Saren is steadfastly proud of CitySquares’ renewal rate. The 40 or so drop outs either went out of business, or “weren’t sold properly.” A few were miffed at bad reviews that appeared on the site, he says.
In a way, then, it is a good thing that CitySquares hasn’t done a better job attracting reviews. It only has about 400 or so reviews at this point, and they’re hard to get. “They’re a nice additive but not a real priority,” concedes Saren. “It’s not a focus for us as it is for a site like Yelp.”
But Saren has high hopes for a new feature that is rolling out shortly: a system that enables businesses to contact reviewers via CitySquares messaging system. “It will be like eBay’s system, and help rectify reviews.”
For the past several months, advertisers have been coming on board at a higher rate, at average spends now approaching $600 per year. Saren attributes the increase to the efforts of head sales guy Phillip Dias, a former CitySearch salesperson who probably knows where the “gets” are in Beantown. There are now eight employees at the company.
Coming up, Saren says he expects more community awareness to be generated as the result of a “Comuni-tees”promotion with JP Licks, a Boston ice cream chain. The promotion is a contest in which community members voting for favorite T shirts depicting various artists interpretations of their communities. Winning shirts will be sold at neighborhood merchants, with proceeds going to a school arts program.
I am baffled as to why I would use a site like City Squares. Reviews? Yelp has way more. Business listings? Google maps, Yahoo local, etc. etc. have business listings. I just don’t see any clear differentiation.
This site faces the same challenges as other local sites that rely solely on user generated content - what motivates users to take the time to contribute? Especially when there are so many other places like Yelp where they can contribute. I think there has to be a layer of exclusive content (such as local news, sports, something) that keeps people coming back, and then you can start to layer on user content.
It’s good to see they are able to sell some ads, but I wonder about the long term viability of a site that has been around for over a year and hasn’t yet cracked 20,000 users a month (at least according to Quancast).
All the community sites are a good sign. And these are all good points.
But if I’m hanging out in “Jamaica Plains” with my cousin Julie, I’d rather go to a real community source that has feet in the street, ties to the arts community etc. Wouldn’t you? Community begats community. I think this is what it’s all about.
PK
If I understand this correctly, and from poking around their site, CitySquares’ differentiation with Yelp is that they provide richer and deeper local business content that doesn’t rely on users contributions. Peter quotes Ben as saying reviews are “a nice additive.” It seems that CitySquares isn’t so much about UGC, which could be a good thing in this crazy local arena.
I have to agree with Tim above. $200,000 gross sales after two years in business doesn’t make me want to run out and start a hyper-local, advertiser-driven website. City Squares is already on death row.. 400 advertisers is a laudable achievement – but at $600/year??? Even if they could sell 10 times that amount, the cost of acquiring the ads (i.e. sales commission) means they can’t make money.
On another issue, the more people use review sites, the more fake/libellous/credibility-destroying and advertiser-alienating reviews will be on that site. The model is inherently self-destructive.
Finally, this whole reviews fad is literally “last year”. Look at the dates of the reviews in a mature Yelp market, like San Francisco. Many business’s reviews have not been updated in almost two years. People are reading –we think–the three or more revews garnered by Yelp’s initial buzz generation-and then not adding more comments (with the exception of hot clubs and restaurants).
A lot of the activity on mature review sites is simply smart SME businesses posting fake reviews to build up their fake online reputation
I can’t speak for others, but for myself, I can’t really understand the challenges that these businesses face without actually dipping my foot in the water. That’s something I, personally, have been hesitant to do. Yet if CitySquares, Yelp, Smalltown, Pegasus, and other local/hyper-local models were working really well, everyone would do exactly that - “run out and start” one. That’s part of the uniqueness of what these companies are doing, and the entrepreneurs starting them are to be commended. They’re going after a very large and exciting market and no one has it perfect yet. That’s also what keeps Peter writing and what keeps all this so interesting.
These are all great points and healthy debate. I couldn’t agree more with Matthew, that if this market was an easy one to tap, everyone would be doing it. That’s no fun, at least not for me.
CitySquares launched in Oct ‘05, and had one mission in mind - prove that this could be of value. After about 6 months or so, we realized we were really onto something. We spent the next year or so virtually penniless and bootstrapping and moving at a snails pace. During that time we featured only a couple dozen of Boston’s neighborhoods - we sliced it up pretty granularly. That’s a small percentage of the greater Boston addressable market. This was intentional, to prove our concept. Now, 2 years later, our achievements might seem as, well, not such a big deal. Yet we know quite differently.
The best is yet to come in this market, and the best is yet to come with CitySquares. This is a very exciting space, one I’m so grateful to be a part of. There’s no other space of the Internet I’d rather be so deeply involved in, and it’s one I’m committed to.
I’m happy to chat with folks about anything relating to the local search and IYP markets, or about CitySquares, or about the Red Sox. Please feel free to email me at bsaren -at- citysquares.com.
Ben Saren
CEO
CitySquares.com
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