Advertising in My Online Neighborhood
Local marketing isn't just about search any more.
Local marketing isn't just about search any more.
Local marketing drives profitability for a wide range of established, geographically focused media organizations. Traditional media outlets succeed by attracting a user base interested in the micro-targeted local information they provide. As a result, an addressable marketplace is created for advertisers.
Small businesses, many of which are local, are an important component of the U.S. economy. According to the Kelsey Group, they drive about $2.2 trillion in economic activity each year and spend over $30 billion on marketing. Only a fraction of that is spent online.
“With local Internet reach equaling or exceeding traditional media,” said Greg Sterling, a Kelsey Group analyst, “we expect local online ad revenues (directories, search, and classifieds) to grow from about $3.3 billion in 2005 to $9.9 billion in 2010.” Note related advertising forms, such as display ads and sponsorships, aren’t included in these numbers. They’ll grow as the markets evolve.
Many offline local media organizations have trouble effectively translating their offerings to the online channel. This is partially due to the challenge of finding ways to target and attract consumers to their online offering without cannibalizing profitable, established offline revenue streams, such as classified advertising.
Meanwhile, search and online yellow pages listings meet some consumer need for local information. But often, they’re not as complete as their offline counterparts and they lack the rich online functionality users have come to expect. Consumers, then, are challenged to find local resources beyond search. As a result, the online local marketing landscape is fragmented and suppliers are testing a variety of approaches with mixed success.
One solution to the fragmented online local marketplace has begun to emerge. Blogging, social networks, and related consumer engagement tools provide a natural platform for localized marketing. Using unique, consumer-generated content to build communities and marketplaces, they meet the needs of consumers, media companies, and retailers while complementing offline media and transactions. This approach was highlighted at the Software and Information Industry Association‘s (SIIA’s) recent conference by Backfence.com and the online edition of “The Austin-American Statesman,” which have become trusted resources by very granularly defining local.
To build traffic, Backfence uses traditional grassroots methods to build relationships with the community, reaching out to local groups, such as PTAs. The site is sustained by viral growth by serving as a resource for local residents and merchants. It avoids conflict with offline media by offering content depth offline can’t cover. It draws involved, repeat users which makes it attractive to local merchants. Due to user engagement and pricing, Backfence’s local yellow pages are the second highest visited area of the site.
Statesman.com uses reader blogs to engage a broader and, often, younger demographic that otherwise might not read the print newspaper. Jim Debth, Statesman.com general manager, advises, “This approach requires marketing and site and content integration to ensure that the blogs get a wider audience incenting authors to keep posting.”
Statesman.com highlights some blogs on its home page to drive traffic to them. For local media companies and retailers alike, these examples illustrate a way to engage local communities to extend online without hurting offline sales.
The Media Perspective
The important issues to consider:
If your analysis points to online expansion:
The Retailer Perspective
Important issues to consider:
If your analysis points to online expansion:
The Analytics Perspective
Important issues to consider:
Blogging, social networks, and related consumer tools can help both established and nascent media companies reach local communities in an era of fragmented audiences. For local media companies or retailers, these online communities are an effective way to tap into this market. The way to do this is by providing in-depth, relevant, unique local content.