News about the local online advertising industry takes up a significant chunk of space in trade journals these days, which is not surprising since it is a $2.9 billion market in 2007 and growing at 38 percent a year according to eMarketer. Local is now the fastest growing segment in the online advertising world. But amid the din of announcements like: "Idearc adds video to Superpages.com" and "Local.com renews contract with Yahoo!," we are missing the biggest inhibitor to the success of local online advertising: most local businesses are not yet advertising online.
Unlike large national advertisers who pay digital ad agencies to guide them through the online world, local plumbers and dentists do not have the budget to hire expensive outside consultants. Furthermore, as they're more likely to spend their days out on jobs or tending to patients, they have even less energy to focus on decoding the mysterious jargon of internet advertising; terms like CPC, CPA, maxbid, exact match, broad match and rich media are as foreign to many of these business owners as a toilet's pressure balance valve or a dentist's porcelain inlays are to most of us.
Today, 63 percent of consumers primarily search for local businesses and services online. But amid the slow hissing sound of deflating printed yellow pages usage, only 3 percent of local advertising budgets have taken advantage of this remarkable turn in consumer searching behavior.
Just as the pundits described the challenge of putting broadband internet in private homes in the late '90s as "the last mile," today's local online advertising industry faces a similar "last mile of local." This final stretch will shrink the gap between advertiser adoption of online advertising and the billions of consumer searches taking place online.
For the few local merchants who have seized the opportunity to turn their advertising dollars to the internet, the results are immediate.
Look at Maria Romia's case, for example. Romia runs an eponymous bridal boutique in Philadelphia, and is among the pioneers of small business owners learning to take advantage of the online ad game.
"I'm not that tech savvy, but I guess many of my customers are," she says. "This stuff works: 20 customer calls in under a month with just a modest budget. This is much more effective than any bridal magazine I paid thousands to be in."
Not surprisingly, businesses like Maria Romia Bridal measure success by a simple and traditional metric: how much more did my phone ring after I began this campaign? As Yodle founder Nathaniel Stevens always says, "Clicks are great, but calls are better."
So how can more businesses take advantage of the web's local consumers? Local aggregators like Yodle, Leads.com, Local Launch, Einstein Medical and Weblistic are cropping up to provide the same level of sophistication in media buying, website design and optimization to small businesses that large national advertisers receive, and in the process helping local businesses reap big rewards for online advertising.
When advertisers turn to local aggregators, those aggregators will manage the business's online ad inventory from a central platform; they can facilitate a far reaching network that can span sites from Google to Yahoo to MSN. For a small business, this gives them massive scope that would be nearly impossible to manage with only their own resources. Additionally, the local aggregators provide expertise for how to optimize the key search terms that potential customers are using.
Turning to local aggregators has become a simple process that most small businesses aren't aware of. From website creation, to purchasing strategic search keywords, to monitoring clicks and calls, local aggregators are making internet advertising simple and manageable for business owners. Few traditional ad networks provide the complete technology platform to manage bidding, websites and phone calls, which small businesses require. The local aggregators are filling this void.
Not surprisingly, once online, these advertisers are every bit as savvy about the return on investment generated by their online media spend. With local aggregators tracking clicks to their websites and calls to their businesses, small businesses are learning to measure their advertising success.
Bridging that last mile of local will help local advertisers get their messages online where their customers are already searching, and ultimately drive billions of dollars of the $100 billion local ad market to the web.
Court Cunningham is CEO of Yodle, Inc. Read full bio.