Australian rental site Rent.com.au (ASX: RNT) launched a “local display ads” product aimed at small businesses looking to target people moving to their local areas.
A “local ad” will cost $49 AUD ($39 U.S.) per suburb, per month, and the advertisements will be displayed within property listings of a given suburb.
Rent said the local-ads product will help small businesses without a large advertising budget to find new local customers easily and efficiently. The real estate site’s chief executive Greg Bader said development of the local-ads platform flowed from consultations with customers.
“In this instance, they just also happened to be operating a bar,” Bader said. “The question of finding new customers arose, and particularly how businesses without a large advertising budget could reach the local new customers that are the lifeblood of any small local business.”
Bader said they wanted to be able to deliver relevant local content to house hunters, and also provide an opportunity for small businesses to reach out to them without diminishing the user experience.
“We are mindful of balancing the need to provide unique and relevant content, which includes local ads, with the main objective of our site, which is to help more people into their new homes. For that reason, we have restricted the local ads to just two per suburb.”
Bader said limiting the number of ads in a suburb will also help create a level of exclusivity for advertisers.
Two small businesses have been trialing the local ads product over the past two weeks, with Rent reporting that the results had been positive so far.
However, the company warned investors that it expects the product to take a while to catch on. As such, Rent will give renters who recommend the local ads product to small businesses free gift cards each month for as long as the ads remain active on its site.
“We do expect local ads to contribute to our revenue, [but] we anticipate it will take some time to grow the local community of advertisers and advocates.
“There is potential for a significant new revenue line with this new product. [But] this is about more than the dollars, it is another example of how the renting community can be supported and how the process can be made more relevant and useful. Ultimately, Rent benefits because its community benefits.”
Rent.com.au, which is the main challenger to market leaders RealEstate.com.au and Domain in the rentals space, announced earlier in the month that it was on a steep upward financial trajectory, with a preliminary financial update showing “continuing revenue” had climbed to $1.3 million AUD.
The company will update the market on its full-year results on July 24.