Hyperlocal is perhaps a leading contender for “buzzword of the year” in Web 2.0.  New companies and startups have latched on to the phenomenon, and you’re seeing more and more coverage as time progresses.


First, what is “hyperlocal?”  I’d contend that it is any application of Web 2.0 concepts to local, long-tail businesses.  Many early definitions of the term have been focused on changes to media, but I think hyperlocal trends are a lot more profound than that.  My old friend John Cooper, a wireless industry consultant in Austin, has been professing for many years now that communities will rally around intelligent and cost-effective resource sharing especially for local wireless Internet networks.  He has a point… as wireless technology improves, why should every house in every neighborhood in America have a separately managed router and wireless access point?  I think there are profound shifts coming in marketing and advertising.  Media businesses such as television and radio continue to suffer from margin contraction and declining audiences.  Social networking gives us an opportunity to learn more about our neighbors, maybe more than we want to know!  All told, our local experiences are likely to change significantly over the next 8-10 years, and it will change how we interact with the "stranger-neighbors" we pass on the street every day.


VCs I speak with either really love or really hate hyperlocal business opportunities.  The cynics say that hyperlocal businesses are incredibly risky, and customer acquisition costs are killer.  Good points although I think that just means that the critical problems are a little different – a hyperlocal startup must 1) lower customer acquisition costs, 2) create a “self-serve” model to help the long tail help themselves, and 3) get help wherever possible with infrastructure needs to focus on their main product/technology.


Enterprises, especially retail chains, can and probably should at least investigate hyperlocal business opportunities as part of a broader Web 2.0 plan.  But those enterprises need to be extremely realistic about how and where they fit in.  For example, a toy store with two locations isn’t nearly as good of a candidate for hyperlocal as say a landscaper or a day care company with 10 locations in a given metropolitan area.  Why is that?  Well, for one early technologies are a better fit when a customer need is solved, not a customer “want”.  (OK, the next Teddy Ruxpin, Tickle Me Elmo, or Furbie may cause a crisis in your household, which then creates a customer need, but it's rare.)  But need isn’t quite enough.  Geographic density or even coverage is critical, especially when other hyperlocal alternatives exist.


Whether or not you are cynical about hyperlocal business opportunity, I do know a few things:

  1. Someone in the startup world is going to figure out the secret to taking advantage of hyperlocal business opportunity,

That person is going to be very, very wealthy,

  • Enterprises that experiment with hyperlocal projects in their Enterprise Web 2.0 work will catch on and do amazing things, and they'll be on the cover of Business Week,
  • Hyperlocal is quite possibly the final frontier of the digital advertising/marketing revolution we've experienced since Google Adwords.
  • This is a trend that I’ll talk about more as time progresses.  We at Notice Technologies are working on some hyperlocal infrastructure and technologies… we'll tell you more as time progresses.