The Basics of Local Online Advertising
Need to drive more business to your door? Use our practical guide to rev up your local web strategy.
Amanda C. Kooser
This story appears in the March 2007 issue of Entrepreneur. Subscribe »
The promise of the web has been a global one. It connects companies to telecommuters, outsourcers, far-off countries and customers around the world. But a new trend in the web is bringing it closer to home . . . and business. The "local web" is the way the internet helps connect people with places in their hometowns as well as their business and travel destinations. For local entrepreneurs, it's about using the web to reach customers and vice versa.
We're not here to preach the value of having a website. You already know about that. This is a look at how to use your site and the many other internet resources available to help customers find you. It's not so much about e-commerce as it is about getting people to your door. "What we have now is a complicated world where people use many different sources of information to find local businesses. They're using the traditional mediums that they've always used, but now the internet has become a very powerful--and in many cases, [the] primary--resource for people," says Greg Sterling, founder of Sterling Market Intelligence, an Oakland, California, consulting and research firm with an emphasis on the local search marketplace.
"You need to be where your customers are, and more and more customers are on the web," says Sheryl Sandberg, vice president of global online sales and operations at Google. Take a look out over the web. There's no one-stop shop for marketing your local business online. People use search engines, online Yellow Pages, industry-specific directories, referral and review sites and online communities. They follow links from other businesses' sites and click on ads while browsing. So here's a primer to help you plan your local web strategy.
The first step is usually the hardest one. This initial stage requires a little patience and a lot of groundwork. Here it is: Get listed. That sounds pretty straightforward, but it actually means you have a roster of websites to visit. The three big search engines--Google, MSN and Yahoo!--should be your first destinations. Submit your site to each engine and then visit their "Local" sections and submit your company information. For example, go to http://listings.local.yahoo.com. The "Local Basic Listings" link takes you to the service. You can fill in information about your business, including hours, services, payment methods and descriptions. Once processed, your business will appear on Yahoo! Local maps and in searches that correlate to your description and category. Google works in a similar manner through its Local Business Center, and MSN partners with Citysearch to generate local information. Basic listings are free.
Ask.com recently launched AskCity for local searches, and AOL also generates its share of search traffic, so be sure to include them in your local web strategy."You should absolutely get your content into every free directory or listing service you can," says Sterling. "It's important to [do this] because you don't know where your potential customers are coming from." Don't overlook vertical sites that serve your particular market and that maintain business directories or listings. Local newspaper websites can be smart and affordable places to post an advertising link. Sites like Craigslist that feature a strong local component can be powerful tools. Not only do local customers browse the ads, but the ads are often indexed by search engines, providing yet another avenue for people to find you.
Look No Further
In a recent study by ROI Research Inc. and Performics on the offline impact of internet search, 55 percent to 65 percent of respondents said that search is at least somewhat influential in purchases they make at retail locations. That number is on the way up. Beyond retail products, more consumers are looking for local services online as well. The same goes for other businesses seeking local partners, suppliers and services.
Newspapers and physical Yellow Pages haven't been abandoned, but they're now pieces of a larger puzzle. A report by Borrell Associates predicts that local online advertising will grow by 31 percent to $7.7 billion and local paid search will balloon by 86 percent to $1.8 billion in 2007. If you want to be found in your hometown, you need to be found online. But being found isn't always free.
Many businesses allocate some of their marketing budgets to search engine advertising. First Crush, a restaurant and wine bar in San Francisco, subscribes to the Google AdWords program. "We started with Google because it was such a big name," says Shahram Bijan, owner of First Crush. "[We] reached a big audience without having to spend a lot of money." First Crush uses 20 to 30 different keywords to trigger its ads in Google. Bijan's goal was to drive search traffic to www.firstcrush.com, where visitors could learn more about the restaurant, its extensive wine list and event catering options, and use its online reservation system. "The great thing about the internet is people are looking for specific information," says Bijan, 29. "You're not just bombarding them with ads."
Get Advanced
Search engines aren't the be-all and end-all of a local web strategy. Most businesses will benefit from a multi-faceted approach. Outside the top general search engines, a handful of sites have popped up with a specifically local bent.
A big trend is convergence websites, which combine local business listings and directories with search functionality and paid advertising. Citysearch, founded in 1995, is the elder statesman of this type of site. Its focus on city guides with restaurants, services and reviews has made it a must-list place for a lot of businesses, particularly those in larger cities. First Crush uses Citysearch in combination with its own website and Google AdWords. This multipronged approach helped the restaurant reach $3 million in sales in 2006, with an expected 5 percent increase for 2007.
Although Kenai, Alaska, has fewer than 10,000 residents, nearly 50 local businesses have signed up with MerchantCircle.com, a local business listings service. Tina Showalter, 43, opened the Blonde Bear Bed & Breakfast in 2005. "Our first summer, we did great with word-of-mouth advertising, and then we got involved in the internet, and it has pretty much exploded from there," says Showalter, who runs the Blonde Bear with her husband, George, 46. They expect sales to double in 2007.
The Blonde Bear's MerchantCircle.com site combines a business description, reviews, a blog, coupons, a map and links to other businesses listed on MerchantCircle.com. All those Kenai businesses on the site got there through word-of-mouth; Showalter estimates she's brought 30 other businesses onboard to help build up the cross-promotional and networking benefits of the site. Look for more services like MerchantCircle.com to hit the scene as the local web market heats up.
With all the avenues available for reaching customers online, it's important to be able to determine what is working and what isn't. "This is all about discovery, trial and error, and refinement," says Sterling. "Be willing to try some stuff and change course if it doesn't work." To find out if your strategies are effective, Sterling suggests entrepreneurs simply ask how their customers learned about them. Online coupons can also be an effective way to track how many customers are visiting your website and then visiting your location.
Search engine advertising services come with analytics and reports that show you how many click-throughs and unique visitors you're getting. These numbers can help you determine which search terms are working, which to spend more money on and which to abandon. It has been a simple equation for First Crush. "When we put up the website, we were getting about 150 to 200 unique visitors a day," says Bijan. "After we started using Google, we're seeing 600 to 800 unique visitors a day."
The Future of Search
There are some subtle shifts happening with the local web. Site-building tools like those offered by Yahoo! and Microsoft Office Live make it easier and cheaper for businesses to build a web presence. As more businesses arrive online, more services will appear to help them launch and manage their local web strategies. "Over time, advertising will continue to get more complicated, but there will be a layer of middlemen there to provide services," says Sterling. These services won't be free, but the most effective ones will be worth the investment.
Looking ahead, you'll be hearing a lot about local going mobile. As cell phones become location-aware, a whole new set of advertising and services will come to life. Look for the leaders in local web search to branch out into mobile search. Both Yahoo! and Google already offer search methods tailored to mobile devices. Yahoo! features an SMS search service that works with most mobile phones and can direct users to local businesses.
The local web is both significant and scattered. It all comes down to making it as easy as possible for internet users to find your business so you can convert them into offline customers. It's a trial-and-error process that combines marketing smarts and experimentation. Get listed, find out what has worked for your peers, try out search engine advertising and get on locally oriented listing and directory sites. The next time someone searches for products or services in your town, be sure you pop right up.
Websites That Do The Work For You
Most entrepreneurs don't have time to become experts in marketing their businesses locally through the web. These sites can take that chore off your hands.
Dotster Local Site Promotion: An example of a web domain registration and hosting company offering a local web advertising package; includes an intelligent keyword optimization tool, pay-per-click search engine ads and the ability to create online coupons and special offers.
Froogle Local: Google's shopping search engine accepts listings for free from local merchants. Users can search for specific products by location. It's another way for brick-and-mortar stores to be found whether they use e-commerce or not.
Local.com: Online Yellow Pages and search engine that offers a free listing for businesses. The Paid Local Promote option gives businesses more control over their listings and distributes your information to other online networks.
ReachLocal: A central location to set up, maintain and track local search advertising campaigns. Pricing is variable.
RegisterLocal: A service that lets you create a Master Business Profile that RegisterLocal submits to search engines and directories on your behalf for $199.95 per year. When you make changes or updates, they're automatically distributed.
TrueLocal: A local search engine that also offers advertising opportunities for businesses. Features full-text searching.
YellowPages.com: Large online local directory site that also includes city guides and advertising solutions. Basic listings are free.