Company Presentation

January 2011

1 Copyright © 2010 ReachLocal, Inc. All Rights Reserved.

 Safe Harbor

These slides and the accompanying oral presentation contain forward-looking statements and information. All statements other than statements of
historical facts in these slides and the accompanying oral presentation, including statements regarding our future financial condition, business
strategy and plans and objectives of management for future operations, are forward-looking statements. In some cases, you can identify forward-
looking statements by terminology such as “believe,” “may,” “might,” “objective,” “estimate,” “continue,” “anticipate,” “project,” “intend,” “will,” “should,”
“could,” “plan,” “future,” “expect,” “predict,” “potential,” “target” or the negative of these terms or other similar expressions. We have based these
forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our
financial condition, results of operations, business strategy and financial needs. These forward-looking statements are subject to a number of risks,
uncertainties and assumptions, including, but not limited to, our immature industry and relatively new business model, our ability to evaluate our
current and future prospects, our ability to grow revenue to offset increased expenses, our ability to purchase media from Google, Yahoo! and
Microsoft, our ability to recruit, train and retain our Internet Marketing Consultants and a number of other factors out of our control, that may cause our
business, industry, strategy or actual results to differ materially from the forward-looking statements. These risks and uncertainties may also include
those discussed under the section titled “Risk Factors” and elsewhere in the Company’s periodic filings and its registration statement on file with the
Securities and Exchange Commission, and other factors that may not be known to us.

These forward-looking statements reflect our current views with respect to future events and are based on assumptions and subject to risk and
uncertainties. You should not rely upon forward-looking statements as predictions of future events. The events and circumstances reflected in the
forward-looking statements may not be achieved or occur. We cannot guarantee future results, levels of activity, performance or achievements.
Moreover, neither we nor any other person assume responsibility for the accuracy and completeness of the forward-looking statements. Any forward-
looking statement speaks only as of its date. Except as required by law, we undertake no obligation to update publicly any forward-looking statements
for any reason after the date of this presentation to conform these statements to actual results or to changes in our expectations.

2 Copyright © 2010 ReachLocal, Inc. All Rights Reserved.

 ReachLocal Overview

Revenue in Millions Key Facts1

$250
Founded 2003
$203
6% $200 IPO Date May 19, 2010
16

$147 Ticker RLOC (NASDAQ)

$150
R:
G
CA

Reach 45 sales offices on

09

$100 3 continents
-’
5

$68
’0

Salesforce 696 IMCs and

$50 300+ resellers
$26
$4 Active Campaigns 22,500
$0
2005 2006 2007 2008 2009
Active Advertisers 17,100

#1 on Deloitte's 2009 Technology "Fast 500" rankings of the

fastest growing companies in North America2
1 As of September 30, 2010
2 Based on percentage revenue growth of technology, media, telecommunications and life sciences companies over the preceding five years (2004 - 2008)

3 Copyright © 2010 ReachLocal, Inc. All Rights Reserved.

 Vision & Mission

ADVERTISING

Vision
All businesses will acquire,
manage and retain customers
digitally

Mission
PRESENCE RETENTION & To help millions of small and
ACQUISITION
medium-sized businesses
acquire, maintain and retain
customers via the Internet

4 Copyright © 2010 ReachLocal, Inc. All Rights Reserved.

 Local Opportunity

$96 BILLION
OF AD SPEND

Consumer / Publisher SMB / Advertiser

Focused on the consumer Focused on the SMB

Search Display UGC

Social Mobile

50% of consumer media time online 4% of local ad spending online

Source: Forrester, Veronis Suhler Stevenson

5 Copyright © 2010 ReachLocal, Inc. All Rights Reserved.

 Local = SMB Problem

SMB Sales Rep Media Consumers

Offline

Digitization and
Fragmentation

?
Online

6 Copyright © 2010 ReachLocal, Inc. All Rights Reserved.

 SMBs: Full-Service, Not Self-Service

5 – 50 employees No time/no media knowledge

Monthly ad spend $500 – $1,500 High opportunity cost
Owner-operated Wants calls, not clicks

Plumber Doctor Auto Dealer Lawyer HVAC Dentist

7 Copyright © 2010 ReachLocal, Inc. All Rights Reserved.

 One Platform = Solution for SMBs

Local Relationships Broad Reach

45 Local Offices 98%1+ of Searches
696 IMCs Proprietary Technology 90%2 + of Surfers
22,500 Active Campaigns
17,100 Active Advertisers
1 Estimated percentage of searches based on aggregate market share of the search engines utilized by the ReachLocal Search Network. Source: comScore
2 Estimated percentage of Internet users that visit sites to which ads are delivered through a display network utilized by ReachLocal. Source: comScore

8 Copyright © 2010 ReachLocal, Inc. All Rights Reserved.

 Product Strategy: One Check, the Internet Budget

ADVERTISING SOLUTIONS

Search engines 100’s of publishers, 1000’s of sites

Vertical search Individual publishers & solutions providers

Local online directories Leading ad networks

Web analytics Out-of-the-box assisted live chat

Call tracking Immediately engage consumers

Email tracking Delivers quality leads

9 Copyright © 2010 ReachLocal, Inc. All Rights Reserved.

 World Class Scalable Technology Platform

Automation: Transparency:
Drives scalability of our business Calls not clicks
− 22,500 campaigns − Dynamic proxy technology
− 17,100 advertisers − Call tracking, recording
− Over 11 million keywords
− Over 25 million calls

Optimization: Reach:
Increases value of ad spend 100’s of publishers
− Conversion based − 98%1 of searches
optimization − 90%2 of surfers
− Click-to-call algorithm
− Budget steering algorithm

1 Estimated percentage of searches based on aggregate market share of the search engines utilized by the ReachLocal Search Network. Source: comScore
2 Estimated percentage of Internet users that visit sites to which ads are delivered through a display network utilized by ReachLocal. Source: comScore

10 Copyright © 2010 ReachLocal, Inc. All Rights Reserved.

 The Evolution of the ReachLocal Distribution Solution
“Feet on the street”
Internet-trained /
Internet-focused

Agencies & Resellers Consultative

2004 Additional selling
opportunities

Direct Local
2006 Q3

National Brands
2007 Q2

2004 2005 2006 2007 2008 2009 2010

11 Copyright © 2010 ReachLocal, Inc. All Rights Reserved.

 Core Competencies in Growing IMC Upperclassmen

Recruit Train Develop Graduate

In-house recruiting In-house training 432 Underclassmen1 264 Upperclassmen1

staff facility and staff Sales managers Account managers
Over 1,000 IMCs Over 60 bootcamps Ongoing development
recruited worldwide since inception1 and evaluation
Across 45 20-30 IMCs per
metropolitan areas bootcamp
and 3 continents1

1 As of September 30, 2010

12 Copyright © 2010 ReachLocal, Inc. All Rights Reserved.

 Profitable IMC Contribution

Average 2009 IMC Annual Revenue Productivity1 Illustrative Annual Contribution Margin for
Retained Upperclassmen2

($ in thousands) ($ in thousands)

$159

$93
$93

IMC Investment
($77)
($77)
Bootcamp
Base salary and benefits
Sales administration and management Year 1 Year 2 Year 3

Office overhead and expenses

Attrition

1 Average 2009 Annual IMC Revenue Productivity equals the sum of the monthly Average 2009 IMC Revenue Productivity for the 12 months corresponding to the year of the IMC’s employment indicated
2Illustrative Annual Contribution Margin for a Retained Upperclassman in Year 1 is based on 2009 results and equals Year 1 average revenue productivity less the sum of (i) the cost of and commission expense
associated with such revenue, (ii) the average Underclassman Expense per Underclassman and (iii) an allocated cost per graduating Underclassmen of the Underclassmen that fail to graduate ("Attrition Costs").
Year 2 and Year 3 Illustrative Annual Contribution Margin is calculated on the same basis, except that it does not include Attrition Costs

13 Copyright © 2010 ReachLocal, Inc. All Rights Reserved.

 Proven Growth and Flexible Investment

Average IMC Maturity (in months) Direct Local Revenue ($ in millions)

22 $60
20
18 $50
16
14 $40
12
$30
10
8 $20
6
4 $10
2
0 $0
1 1 1 1 1
Q1'08 Q2'08 Q3'08 Q4'08 Q1'09 Q2'09 Q3'09 Q4'09 Q1'10 Q2'10 Q3'10

Upperclassmen
30 45 70 80 108 143 208 235 227 246 264
Underclassmen
246 289 323 337 277 256 317 280 342 395 432
Total IMCs
276 334 393 417 385 399 525 515 569 641 696

1 Direct Local revenue and the Upperclassmen and Underclassmen headcount includes the revenue and IMCs, respectively, associated with ReachLocal Australia starting in Q3 2009
2 Average IMC maturity is calculated by taking the simple average of the months employed for each IMC for each of the three months in a quarter

14 Copyright © 2010 ReachLocal, Inc. All Rights Reserved.

 Key Drivers

IMC Maturation IMC Count IMC Optimization

$ $

Time Time

Natural maturation of IMCs Hire more IMCs Additional products and

over time Open more offices services
Additional Upperclassmen Increase IMC capacity
Increase client tenure

15 Copyright © 2010 ReachLocal, Inc. All Rights Reserved.

 Growth Strategy

Advertising
ADVERTISING
− Grow IMC sales force
− Technology and process
improvements
− Expand product offerings

Presence
− Digitize
RETENTION & − Publish
PRESENCE
ACQUISITION
− Monitor

Retention & Acquisition

− Connect
− Communicate
− Discover

16 Copyright © 2010 ReachLocal, Inc. All Rights Reserved.

 ReachCast: The Presence Challenge for SMBs

You Have: a static website & one way to be found

You Need: a fresh Web Presence & many ways to be found

Your Sites Local Directories Social Media Content Sites

More Quality Content Published in More Places = More Customers

17 Copyright © 2010 ReachLocal, Inc. All Rights Reserved.

 Introducing ReachCast

+
Web Presence Technology Web Presence Pros
Platform

18 Copyright © 2010 ReachLocal, Inc. All Rights Reserved.

 ReachCast: How it Works
Website

Cast page

You embed the content on

3 your site* to provide a fresh
stream of updates & offers
We create fresh content on
your Cast page that drives 2
search discovery & social
sharing 1 Your Cast page drives traffic & search
engine “juice” to your site
We create “offsite” content that
drives inbound links & increases
4 your search rank

Search Engines Local Directories Social Media Sites Blogs & Article Sites

19 Copyright © 2010 ReachLocal, Inc. All Rights Reserved.

 ReachSearch + ReachCast = Total Coverage

•High position via

paid search ads
•Immediate results
for many keywords
•Optimized daily to
increase ROI •Organic map and
search listings for a
few keywords
•Results build over
time via content
marketing
•Good reputation
helps improve
conversion

20 Copyright © 2010 ReachLocal, Inc. All Rights Reserved.

 Financial Review

21 Copyright © 2010 ReachLocal, Inc. All Rights Reserved.

 Financial Highlights

ATTRACTIVE
FINANCIAL MODEL
+ GROWTH
INVESTMENT
= COMPELLING
LONG-TERM MODEL

Proven unit level Grow IMC count Sustained revenue growth

economics Develop new products Significant operating
Large growth − Advertising leverage
opportunity − Presence

Scale − Retention

Strong cash flow Improve efficiency and

technology

22 Copyright © 2010 ReachLocal, Inc. All Rights Reserved.

 Strong Revenue Growth

% $203
Direct Local 1 59 %
National Brands, Agencies and Resellers G R: : 72
l CA AGR
a C
Loc ue
t en
i rec Rev $147
9 D al
0 t
7 - ’ 9 To
0
’ - ’0 $141
’07
$83
$68
$21
$1
$26 $1
$64 $62
$0 $47
$4 $25

2005 2006 2007 2008 20091

Note: $ in millions
1 Reflects the operations of ReachLocal Australia acquired on September 11, 2009

23 Copyright © 2010 ReachLocal, Inc. All Rights Reserved.

 Strong Quarterly Revenue Growth
($ in millions)

Direct Local
National Brands, Agencies and Resellers

$77
$70
$64
$60
$53
$48
$43

1 1 1 1 1

1 Reflects the operations of ReachLocal Australia acquired on September 11, 2009

24 Copyright © 2010 ReachLocal, Inc. All Rights Reserved.

 Efficient Operating Model

Underclassmen Expense Adjusted EBITDA Operating Cash Flow

$27.9 $26.8 $26.0

$19.2
$12.1 $14.3
$12.1
$0.7 $0.8 $6.2
$1.4

$(3.3)

2008 20091 9 mo. 9 mo. 2008 20091 9 mo. 9 mo. 2008 20091 9 mo. 9 mo.
20091 20101 20091 20101 20091 20101

Note: $ in millions
1 Includes the post-acquisition results of ReachLocal Australia acquired on September 11, 2009

25 Copyright © 2010 ReachLocal, Inc. All Rights Reserved.

 Long Term Target Model
FY 2009 2010 YTD Long Term Target

Revenue 38% y/y 47% y/y growth2 30+% y/y growth

growth2

% of Revenue1 % of Revenue1 Decrease as % of revenue1

Cost of revenue 54.9% 54.4% 1% - 3%

Sales and marketing 36.7% 36.8% 7% - 10%

Product and technology 1.6% 1.8% 0%

General and admin. 6.1% 6.6% 3% - 4%

Cost of rev. and opex 99.3% 99.6% 11% - 17%

Adj. EBITDA1 0.7% 0.4% Target 14-16%

1 See SEC filings for definition of Adj. EBITDA

2 Reflects the operations of ReachLocal Australia acquired on September 11, 2009

26 Copyright © 2010 ReachLocal, Inc. All Rights Reserved.

 Investment Highlights

Large, global untapped local online opportunity

Category leader in local online marketing

Proprietary technology platform built for the SMB

Dedicated “Feet on the Street” sales organization

Deliver valuable digital marketing solutions to thousands of SMBs

Strong revenue growth fueled by predictable unit economics

Multi-faceted growth strategy

Experienced management team

27 Copyright © 2010 ReachLocal, Inc. All Rights Reserved.