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ReachLocal business model

Posted February 13, 2008 by acroterion in Pay-Per-Click

reachlocal.gifYou asked about ReachLocal business model. This is what I’ve found about their business model. The name of the CEO I was speaking with is Zorik Gordon. Actually, he didn’t buy my product but he did ask for my advice!

From their site:

: What factors determine whether my ad will be seen on search engines?

A: The keywords chosen will also influence your ad appearances. ReachLocal chooses the best keywords that will drive target customers to your site. The daily budget of your campaign will determine how often your ad will show, and its positioning.

Q: How do you charge?

A: We put a margin on the advertising fees charged by the search engines we use i.e. Google, Yahoo!…

From Blogs:

Q: Hi, I’ve been looking at a company called Reach Local and wonder if anyone has any experience of working with them. I’m concerned that, whilst they may return good results, their reach or ability to generate volume is limited. Also, how do the search engines view the fact that they “mirror” the actual web-page? Thanks in advance

A: I’ve tested Reach Local out since January and was not happy with it. It was fairly easy and quick to implement and it was great being able to forward reports on to clients in the way of email. Whatever keywords you provide them with, they will expand into thousands of completely irrelevant keywords to generate a high volume of clicks – not necessarily focus on highly targeted, relevant keywords on your most profitable products / services.
They do not share their keyword lists with you to determine results on a keyword level to make optimizations.

In my experience with ReachLocal, my clients and I were very upset with the results we received and when handled manually, we saw a 90% decrease in costs, a significant jump in positioning, double the amount of clicks, and huge ROI. With Reachlocal, we were wasting money, getting few clicks, and no sales. We also got a significant amount of traffic from outside the state and country we were targeting.

About the Author


I am Elchanan Rotstain, the CEO of Acroterion since 2001, after twenty years of academic research and direct work experience with search engines and software architecture methodologies. I known to the world as "The Search Engine Doctor", and am internationally known expert and author of a voluminous University thesis about searching methodologies, later used by the first search engine frameworks. Presently doing research with Ph.Ds at University of Alberta, University of Michigan and The Department of Mathematics at Bar-Ilan University.

One Comment


    We are trying to figure out which industries/size businesses work with which internet marketing services. This post outlined some of the issues that our small business members face and thus why we are trying to put together this data base. I think the major problem with these type of services are sales reps over selling and under delivering.

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