LocalResponse Doubles Staff, Opens Midwest Office

After raising $5 Million in funding last month, LocalResponse is putting its cash to use.  The advertising platform, which enables brands to engage with users around check-ins, is doubling its staff and opening a Chicago office to focus on Midwest sales, according to statement released this morning. The company is already attracting solid talent, and is bringing on 2010 IAB Salesperson of the Year for the Midwest Toad Hayes to head up Chicago operations.

The New York-based company has been picking up steam since August, when it acquired social T.V. service Philo for an undisclosed sum. After shifting its focus from small and medium-sized businesses to larger brands and agencies in the early summer, the company has teamed with a handful of major national and international players like Coca-Cola, Walgreens, and Audi.

In the same statement released this morning, the company also announced that it would be expanding its platform reach in Q1 of 2012 by adding a display ad product as well as by offering larger brands and agencies a self-serve version of its service as a SaaS tool.

LocalResponse’s current product allows marketers to target offers to consumers who have “explicitly” checked-in via services like Foursquare, or “implicitly,” by geo-tagging a tweet or semantically signaling their location in an update. With 250 Million tweets daily, and 10-15% of those tweets “explicitly” or “implicitly” disclosing location (according to CEO Nihal Mehta), the platform’s reach is far broader than is typically associated with location-based services.

It is unclear what the display ad product will entail, but the move into the broader advertising space marks a substantial expansion for the company. Mehta declined to elaborate on specifics, but told Street Fight that “[the display product] will be leveraging social signals (Twitter, Facebook, etc) to assist in the targeting of those display ads.”

Part of the genius of LocalResponse’s platform is that it targets and contacts consumers through the public channels offered by social networks like Twitter. Moving into the broader display environment will likely dampen the extraordinary high CTR’s seen in recent campaigns and more importantly, could expose the company to broader privacy concerns.

Much of what has allowed the company to experience such rapid growth with bigger brands so far is due to the team’s multidimensional approach to location. The platform can process a consumer’s location in terms of both proximity (i.e. how close he or she is to a brick and mortar store), and audience — in which, location is used to target a certain consumer profile (similar to what PlaceIQ offers.)

By moving beyond proximity targeting, the company has effectively opened the typically location-apathetic market of brands without physical locations to its service. During a panel at last week’s IAB mobile conference in New York, Mehta described a campaign that the company put together for Proctor & Gamble, in which users exiting nightlife locations after 2am would be targeted with a tweet prompting them to take Pepto-Bismal as the “last shot of the night.”

Based in the Chelsea, the company’s expansion to the Midwest marks another big step for New York in becoming the center for hyperlocal innovation. LocalResponse shares office space with a handful of other LBS companies, including location-based social-networking app Sonar and photo-sharing app Tracks.

Steven Jacobs is an associate editor at Street Fight.