Savveo may be the best thing for local merchants to test drive since Groupon—or so the $2 million round of Series A funding the company announced this week would indicate.
The latest venture from the founders of OverstockAds.com, Savveo seeks to bridge the gap between businesses and agencies to change the way local advertising is found, bought, and sold. According to Shafi Mustafa, CEO of Savveo and founder of OverstockAds.com, hyperlocal advertising is "one of the most effective ways for businesses to reach their prospective customers, but the way it's done today is wildly inefficient and frustrating."
Savveo's online marketplace is expected to go live later this year with a model that aggregates local advertising inventory in many of its offline forms—including print, radio, and television—in order to bring a comprehensive view of all available advertising options to buyers and sellers. Within the online marketplace, users can identify and compare opportunities, and then purchase and track campaigns.
"In 2011, the total global expenditure on local advertising was almost $450 billion," said Steve Villa, cofounder and president of Savveo, in a statement. "In the U.S. alone, it topped $137 billion…. To date, no one has done the hard work to aggregate, categorize, and productize that ad inventory, especially the offline ad inventory, which accounts for ninety-one percent of the spend."
According to research firm BIA/Kelsey's Media Ad View report, local advertising spend will experience a compound annual growth rate of 2.6 percent between 2011 and 2016. Spending, however, is expected to continue its shift from traditional to digital advertising, with online and mobile ad spend expected to increase from $11.1 billion in 2011 to $21.8 billion in the next five years.