• by Laurie Sullivan  @lauriesullivan, December 23, 2009

PaperG has been testing a platform with a handful of companies that lets small businesses automatically create and place ads on participating publishers' sites. The platform -- PlaceLocal, scheduled to launch within two months -- relies on search technology to crawl the Web and pull in information about the local business. The content helps to create the ad.

PlaceLocal's technology pulls content from third-party directories, videos, still photos, positive reviews and awards. After typing in the business name and location, the online ads take about 60 seconds to build. The advertiser can also edit the ad after the platform designs and builds the advertisement.

One of the biggest barriers for small businesses to invest in online display advertising has been the cost of designing an ad. Many don't have the budget to hire someone or the Photoshop skills to put it together themselves. "We're not trying to be Google," says Roger Lee, PaperG co-founder and chief operating officer. "We're just trying to develop a focused and niche search engine that can find content across the Internet about a local business. The ads you see are standard banner ads that meet IAB specs."

PaperG, a New Haven-based startup focused on local advertising and media founded by Harvard and Yale graduates, also recently inked deals with four media companies to deploy Flyerboard, the company's online advertising platform. The news comes shortly after the company announced it has raised $1.1 million in its second round of funding from AppNexus CEO Brian O'Kelley, former Boston.com publisher Steve Taylor, and Mark Potts, among others.

Asbury Park Press, New York Times Regional Group, The New York Post, and Gannett Co.'s and Tribune Company's joint venture, Metromix, join Newsday.com, Boston.com and others that have already deployed Flyerboard.

To create Flyerboard, PaperG took the concept of the cork bulletin board and made it digital for the Web. The concept aims to give small businesses an inexpensive way to promote themselves in local markets. For many small companies that have tried the ad platform, Flyerboard marks the first foray into online advertising, Lee says.

Flyerboard runs different sizes depending on the publisher using the technology. The publisher sells positions on the board to local businesses. A restaurant might buy one of the four positions on the bulletin board and post their ad. The board fits multiple ads, which lowers the cost for local businesses. Before, companies would need to buy the entire ad spot, but the Flyerboard divides the space into four ad spots.

Most Web advertising is uniquely sized. The typical spec for ads posted to Flyerboard is about 8 inches by 11 inches, which allows small businesses to use previously created ads. "Prices to run the ads in FlyerBoard, depending on the partner, would typical range between $50 and $100 per week," Lee says. "Typically, that would cost a small business in the hundreds, if not thousands, of dollars. Often the minimum requirement to post the ad is one month."

The platform has the technology to rotate the four ads placed in Flyerboard at different times. Not all ads need to rotate simultaneously. Lee says "click-through rates have been between two and three times that of traditional banner ads." He attributes this to Flyerboard's ad format and the ability to click through the ad to get more information.