Patch Triples Traffic Year-Over-Year, Claims Growth Across Network ‘Consistent’ | Street Fight

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Patch Triples Traffic Year-Over-Year, Claims Growth Across Network ‘Consistent’

7 Comments 10 January 2012 by

Aol has been taking heat in recent months for its sizable investment in its Patch network of hyperlocal sites. The company, which was built around a play for local banner advertising, reportedly cost the Web giant as much as $160 million to build up and maintain in 2011.

But while progress on monetization is still pending, traffic does seem to be growing for Patch — perhaps in part due to its expansion of sites in the past year in addition to growth at individual Patch sites. According to ComScore, Patch’s overall traffic (in terms of unique visitors) more than tripled between December 2010 and December 2011. Patch also reports that its traffic grew 5% in December, to a total of 9.9 million UVs versus 9.5 million UVs in November, making it the fourth-largest network of local sites. Other top local networks listed were Yelp (#1); CityGrid (#2), Yahoo! Local (#3), and CBS Local (#5).

Patch president Warren Webster was eager to discuss the ComScore numbers, speaking with Street Fight this morning about what the it means for the network. According to Webster, the data reflects “relatively steady” growth from town to town, validating a replicable launch approach and the towns in which they’ve chosen to start Patches.

“Our first towns that we launched ranked high on our methodology, and we knew that we were going to see some good growth from there.” he said. “The big question was: if we launch hundreds of these, will they all follow the same or better trajectory? And the great thing is: yes they do. So while it would be possible to launch in some great towns, and some not so great, we’re seeing generally consistent growth across all of the different Patch sites. … It’s really a lot of organic growth in each of our communities, as opposed to some big bump coming from somewhere.  So we’re pleased that it’s not a huge, crazy anomaly. … We believe in our communities, and this traffic growth confirms that they believe in us.”

The big question was: if we launch hundreds of these, will they all follow the same or better trajectory? And the great thing is: yes they do. — Patch president Warren Webster

He noted that the average Patch site is less than 14 months old, and that in many markets the sites were still “essentially a new brand.” In looking at year-over-year traffic growth, it should be noted that the growth in the number of sites has necessarily produced a growth in the total number of stories being produced across the network (and doubling the amount of daily content produced over 14 months is a good way to increase year-over-year traffic data). Patch grew from 50 to 750 sites in 2010, with most launching toward the end of that year; in the past year, that number rose to 863.

“We look at traffic success on a per-site basis and the populations of the communities we’re in range somewhat,” he said. “So, rather than looking at whole numbers we look at the percentage of the population that we’re capturing in terms of UVs. And we know that some people are looking at the sites from neighboring towns, or your grandmother that lives in California, but generally it’s a good measuring stick to look at — the penetration percentage. So obviously when you’re getting into the 80%, 90%, 100% penetration levels you’re obviously not growing as quickly as you were. So there is somewhat of a cap at a certain time. The vast majority of our sites have not hit this cap.”

Given that some communities necessarily perform better than others, would Webster consider shuttering underachieving Patches in the coming year? Not exactly, he said, though there may be some shifts.

“We did a pretty god job at deciding where to go,” he said. “Sometimes we’re finding that one community makes sense to be merged with another one, just because that’s the way people in that area think about where they live. Or in some cases maybe split it between two. So we think about it that way: ‘Are we matching the geography to the people who live in the town?’ We’re not weeding out sites, per se, but we’re always looking to see that we’re set up right within each of our communities.”

Webster said that traffic in primary states has thus far been a bright spot, and he expects traffic to grow even more from the sites’ growing focus on the 2012 election: “We think that we can do something unprecedented with the primaries and with elections in general where we can spark local conversations about a national election. We were big in Iowa and we’re heavy in New Hampshire. We’ve got our first mobile unit, a 24/7 RV, out there in New Hampshire right now. So we’re definitely seeing a lot of great traffic from that. But the most important thing to us is that we’re covering it from a local perspective, so what we really want to do is serve the people who are in those communities, so if we’re in Concord, N.H., or Portsmouth, N.H., we’re talking to the people there.”

And what about the monetization? Will all this extra inventory translate into dollars? Webster said progress on the sales side is en route: “We’re expecting very meaningful growth in monetization in 2012 and 2013,” he said.

  • http://www.facebook.com/allyourtv Rick Ellis

    The takeaway comment from this interview is the one about individual Patches getting market penetration of 90, 100% of the population.  Think about that for a minute. What are the odds that any publication can grab 100% monthly penetration of a population? This percentage reflects the growing importance of out-of-market UV’s to individual Patches. That’s the only way to get to a 90% penetration and while those numbers make the national sales easier, it helps explain the challenges being faced by local and regional Patch sales executives. If only half your UV’s (or less) originate locally, that means the local ads are less effective and of less value in the long run. That’s the big challenge for Patch.

    • Joni Muller

      Think about what getting 90-100% of a population really means for an advertiser, though.  That means that these ads, whether they’re local or national, are going to be a massively effective way to reach that local audience.  

    • Darren Reston

      You’re right about local vs. national ads, and from what I’ve heard, the Patch sites —although being all about hyperlocal news (except when there is none, in which case recipes and product recalls help fill the daily “new content” requirement) — are indifferent to local advertisers.

      Sure, when a new site starts up, they do a bunch of local business listings in an effort to attract some ad revenue, but that’s mostly done by stringers who are paid from the editorial budget (at least in my region’s Patches).  The advertising staff is minimal and not even always based in the same region.

      Perhaps my reading comprehension isn’t what it used to be, but I don’t see any comment in the story explicityly saying any individual Patch site is getting 90 or 100 percent of a population. I do see this quote:
       “So obviously when you’re getting into the 80%, 90%, 100% penetration levels you’re obviously not growing as quickly as you were. So there is somewhat of a cap at a certain time. The vast majority of our sites have not hit this cap.”… and while it implies that whatever you have left after you take away a “vast majority” (a “miniscule minority,” perhaps?) might be at those levels, the reality is that the communities where Patch appears to be faring best are communities that didn’t have a strong local news presence to begin with. And which types of communities typically have been underserved by the media? The answer is communities that don’t have significant population numbers (relatively speaking, of course) or the household demographics  to justify the expense.

      My takeaway from this is that Patch still hasn’t generated any money, though it has expanded dramatically. If the revenue doesn’t come in  during 2012 and 2013, I expect a lot of the Patch sites to be shuttered or sold off.

  • Dhyana Sansoucie

    “The vast majority of our sites have not his this cap.”

    That sentence and the one the precedes it indicates that some day they will hit a cap when they near 80-100% market penetration, but they have NOT in fact done so.

    So you should reconsider your opinion that this article claims 80-100% market penetration. It in fact states that is not true.

  • Caryn

    As someone who submits news and events for my clients on Patch, it would be great for some of the towns to allow neighboring towns that do not have their own Patch edition to include their news and their venues. This is a continual frustration, esp. because I do believe people are reading their local Patches. In order to encourage advertising it would be wise for editions to serve a broader audience or merge the towns where needed to reach more people and serve more potential clients.

    • Edward Willing

      They do in Wisconsin here. My local Caledonia Patch serves Racine, Franksvill and other news, even though they don’t have their own Patch.

  • Steven

    $160M for 10M uniques? Worst business ever.




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