How Your City Website Can Drive Revenue

Cities are losing revenue because customers do not use city websites, but DigitalTwon can help cities create revenue with their websites.
Image: Pixabay

City revenue does not need to be lost to big Web corporations in retail and service spaces; the DigitalTown platform drives consumers to city websites.

Vendor Spotlight on DigitalTown.com.

After a recent sit-down with DigitalTown.com CEO Rob Monster, it became clear that in order for cities and towns to compete today, cities need to re-think their digital infrastructure and how to become a modern smart city.

In particular, there are two key trends that are frequently overlooked by city management when it comes to digital strategy, The Extraction Economy and The Search Economy.

The Extraction Economy

If you have not heard the phrase Extraction Economy, it is a good one to add to your vocabulary. It is the reason why state sales tax revenue is down to 2001 levels in states such as Georgia. This is largely due to companies such as Amazon, Expedia, Airbnb and OpenTable.

Opentable – A company not based in your city, and owned by Priceline LLC, extracts as much at $8 per person for a reservation at one of your restaurants. For many restaurants this is not feasible, and so they simply opt out. The result is lost revenue for the city and its local economy.

Expedia/AirBnB – They extract as much as 28 percent of every hotel room sold or house rented in your city. The result is lost revenue for the city and its local businesses.

Amazon – When it comes to retail, Amazon is playing for keeps. The result is lost revenue for the city, local retailers and in some cases, retailers simply shut down.

Uber – The popular ridesharing service started at a modest commission rate of just 5 percent.  More recently, drivers who sign up are losing $1.80 off the top and then 25 percent off of the remainder.

As these online brands gain market dominance in their respective niches, overcoming local competition, they increase their fees. This is the extraction economy, and it is the economic equivalent of a death by a thousand cuts.

So how does a city manager, mayor or economic development director combat this trend while simultaneously driving revenue for their city?

On DigitalTown.com, each merchant is equipped with an online storefront with which they can sell online, 24 hours a day and 7 days a week.  The DigitalTown platform works across a broad range of business types, including retail, services, dining, lodging and property. The result is that the fee structure applied can be retained by a city to re-invest.

The Search Economy

To a rapidly growing extent, online search drives consumer behavior on the Internet. Whether Google, Bing, Yahoo, Amazon or Expedia, when a consumer has a question or seeks a service, they “search” for an answer.

When a citizen or visitor goes to a city or town website, they are not presented with a full local search experience because city websites typically limit “field of search” to just their own administrative content, rather than the entirety of the city.

In addition, many experts agree that Google and other Search Engines have at most only indexed 20 percent of the Web. A lot of each city never surfaces in Web searches.

So how can a city compete in search?

Smart cities will support their local search experience with relevant opportunities for transacting online with the public sector (pay taxes, pay sports fees, permitting, etc.) as well as finding goods and services available for purchase from local merchants and service providers.

With DigitalTown, a city can now offer restaurants and hotel reservations at a fraction of the cost. Local shop owners can automatically access e-commerce opportunities, reachable through a city-branded website. The result is that fees that are captured are no longer sent outside the city to multinational corporations–they are retained within the community.

Take Control to Get Results

With a platform like DigitalTown, cities can compete for consumers’ purchasing power and expectations, without hiring new personnel or purchasing new hardware.

Cities can drive revenue back from the Extraction Economy and by taking advantage of the Search Economy.

The DigitalTown.com platform could change the game for any city leader who wants to truly level the online playing field for local businesses, while keeping more funds in the local economy.

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