from hobby to the real thing

I started a few years ago a few blogs with the format of a directory with some business listed on it. It started by using all free stuff (free blog services, hosting, templates, images etc etc) today I can pay my own hosting and other stuff just from the earning of that site (The earnings come from third party ads). In the last month I manage to develop the site to allow the business owners (the listed ones on the site) to update their info, and to have some other interesting features on the site. My question is how should I approach them and what should I offer.

• Should I approach them personally, perhaps show a demo of the
  features of the site (what they will get).
• by email ?
• Should I let them use the site for free for a period of time
• should I mention a price before hand (no free trial).

My biggest concern to get too cocky or stupid since I know that the site itself ranks really well, it only have two competitors, which are way far from been a proper competitor, and the features that my site will offer to them are mind blowing (if compared to the other sites).

Why not try the benefit approach? I assume you have web logs so you can track exactly what benefit your site generates for each of these businesses. Start by making reports for each of the businesses you send traffic to. Send them free weekly or monthly reports (short 1 page) that show how much traffic you send to them and how many people view their information on your web site. (Let them opt out if they don't want to receive this info.) Once they have received this free information for some period of time you can approach them and offer to give them more control, more traffic, or some other benefit for a fee.