AOl’s Patch struggles for traffic in tough hyperlocal market

by @gordonmacmillan, posted on 17 January, 2011 at 10:31 am, filed under Hyperlocal, Journalism and tagged , , , , , , , , , , . Bookmark the permalink. Follow any comments here with the RSS feed for this post.

According to a New York Times report, AOL’s hyperlocal business Patch.com is in some quarters struggling for traffic.

Stories are getting as little as 100 page views and 500 views is considered a success. The problem is that such crumbs of traffic are hardly going to pull in much advertising revenue, which has proved the downfall of past failed hyperlocal ventures.

Patch.com is already in more than 700 US towns and by the end of this year that number will hit around 1,000. Each of those sites has its own editor and freelance writers.

But it is clearly hard going for all concerned which bears out reports last year that one editor saying that Patch sites are sweatshops.<

“Traffic on individual sites is low; former editors say that the average post attracts just 100 views and that they considered 500 page views a wild success. But the overall traffic is growing quickly. In December, Patch had just over three million unique visitors, 80 times that of a year earlier, according to comScore.

“Yet over the years, a number of so-called hyperlocal news sites have failed, and the idea is largely unproved financially. For example, Backfence, a hyperlocal forerunner that invited readers to contribute articles, closed after it was unable to attract enough users and advertising,” the NY Times reports.

Some of those failures, of course, are closer to home than the likes of one time hyperlocal pioneer Backfence which closed three years ago because of “business issues”. The New York Times itself axed its hyperlocal project “The Local” last year.

Other notable failures have included the Washington Post, which closed its Loudoun Extra after two years.

The NY Times Local attracted plenty of contributors, but what it didn’t attract was significant advertising revenue to make it a going concern. This is the same hitch in the hyperlocal ointment that the Washington Post also discovered.

But these commercial failure are not deterring others from trying. AOL is powering forward as is Gannett, which said last year it would launch more than 100 hyperlocal sites.

For those persevering there is a great analysis of how to run hyperlocal news or community site that was published by Jan Schaffer, the director of the J-Lab at American University in Washington, DC, who whose fund has invested in 46 sites in the last five years. It has ten key takeaways.

While I’m here I want to mention a UK hyperlocal project Media Street, which is hoping to expand its hyperlocal business with a $90,000 investment from journalism foundation after it entered the Knight News Challenge and made it through to the next round.

Its flag ship site is the King’s Road which offers hyperlocal news and information on the upmarket part of London. It is working on developing a web application called Media Street to run sites like King’s Road as well as its other two sites Notting Hill Gate and Fulham Road.