However, in certain markets (e.g. the Czech Republic, Hungary) we feel that it would be far more profitable to sell advertising directly, and the most obvious way to start is with "sponsored listings". A sponsored listing is essentially selling preferred placement to businesses. For example, a business would always appear as the first result for "burgers", even if they were not the closest result based on the search area of the user.
Every major local search site sells sponsored listings, including Yelp, Yahoo! Local, Qype, and the Yellow Pages.
We've decided that we should do the same (sell sponsored listings), which leaves us with two questions to answer:
- What effect does it have to place a business first in search results?
- How much should we charge?
As for #1, the easiest was to test this is to choose some business and place them first for searches relevant to their business category. In early January, we did exactly that with the business listing for the Jama Pub in downtown Prague.
As can be seen in the graph, page views for Jama increased 3x from the time we put Jama at the top of search results (early January), while page views for another popular pub in Prague, U Zlatého Tygra remained relatively stable1.
As for #2 (how much we should charge), I still have no idea what this increase in traffic is worth to a business. What we'll do is set the price very low to start - 20 EUR per month. If you're interested in buying a sponsored listing on Nelso (3 months minimum), send us email at email@example.com.
1 Don't read too much into the graph above. U Zlatého Tygra still gets far more traffic than Jama. The graph only shows the relative change in traffic over the last few months.