The new era of methods used by today’s companies
As more and more consumers start including “near me” in their Google searches, many businesses have tried unconventional methods to rank locally.
Whenever a business lists an address in order to rank in local search results, Google mails a postcard with a code that the business must then confirm, almost like two-factor-authentication for real estate. Some businesses were able to expand their brick and mortar footprint overnight, in the eyes of Google, by buying access to virtual mailboxes and receiving photos of the verification cards when they were delivered.
Strategies like this are among many factors that are driving the growth of virtual business addresses, though it mostly comes down to several macro trends. For one, the nomadic lifestyle, along with remote work, is on the rise. Many small businesses are increasingly being started without addresses, but there are still many documents, products, and services that require an address. From company registration with the government to payouts via Stripe or YouTube, addresses are still widely essential.
Virtual Business address providers
Privacy and professionalism also play a big role. Small business owners who work from home say that using their home address may be seen as unprofessional and they don’t want their address listed so prominently online. Virtual business address sellers are easily able to price discriminate between those seeking privacy versus those seeking prestige: Companies in this space tend to mark up addresses like “Park Avenue” whereas those who are solely privacy-conscious don’t care for one specific address over another.
And not only is it a massive and not-fully-tapped market, but the retention characteristics are some of the strongest. While small businesses typically have low retention because of budget constraints and their high failure rate, an address is one of the stickiest assets: it’s hard to remember every form that’s been filled out, and it’s not a safe bet that there won’t be important mail—tax bills, legal documents, and other important messages are more likely to be sent by mail— so these customers tend to stick around.
Virtual mailbox providers, which also scan and digitally forward mail, charge up to $500/year. This is especially striking because these companies are not really logistics companies; they receive mail, but they don’t send it, so in principle, the business is not much more complicated than having a mailbox at a normal residence.
The opportunity is particularly ripe for ranking in search results using a longtail search keyword approach, as consumers search for terms like “virtual business address Fort Lauderdale”.