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Is Local Advertising Right For My Business?

February 12, 2018 at 7:06 AM

Wondering if local advertising is right for your business? If you can answer 'yes' to any of the questions below, it just might be the marketing solution you've been looking for.

 

1) Am I trying to drive traffic to a physical location?


If you have a physical store, then advertising locally can help you boost foot traffic and bring passersby into your store.

During the 2014 holiday season, UGG Australia encouraged people to visit their specific stores by using their address in a fancy way in their ad copy. Check it out:

An example of a local advertisement on Facebook

With a literal call-to-action (“Get Directions”), the brand was able to drive sales, resulting in a 3x return on their advertising spend. That’s the power of contextually-smart local advertising.


2) Has my foot traffic become stagnant?


If that’s the case with you, then going local is not a bad idea at all. EI School of Professional Makeup turned to local advertising on Facebook to connect with 18 to 35 year olds. In just a month’s time, the school generated two million local impressions at a mere $0.002 per impression.

A small makeup school uses Facebook to advertise locally


The school saw sales rise by 50% with spending less than $40,000 in a month.


3) Does my business experience a “low season” where business struggles?


Every business undergoes high and low seasons - depending upon the industry it functions in. And by season we don’t just mean month-to-month period, it also includes timeframes in a day. If your business struggles during the “off season”, then perhaps a witty local awareness ad can solve the problem.

BarKogi, Korean Fusion restaurant and bar, offers brunch and happy hour specials everyday. After realizing that people make happy hour plans just hours before the actual happy hour starts, BarKogi decided to run local ads to remind people.


4) How competitive is my industry?


Are you a grocery store? A beauty salon? A popup clothing store? As a consumer, if you have the choice of choosing from 50 grocery stores, you are going to choose whichever is the closest. But if there is only one beauty salon in your locality, you are more likely to drive across town.

Sears Hometown and Outlet Stores may have over 1,200 stores across the US, they sell the usual items that any mom and pop shops can also sell. So, how do they stand out? The brand runs local awareness ads to encourage people to shop from their stores.

Of course, exciting discount deals and coupon codes form a part of their ad copies but they are able to maintain a buzz around their brand by connecting with super-niche audience.


5) Do my margins justify advertising?


Running ads is not always going to get you converted leads and more revenue - at least not till you have tried different kinds of ads over a course of time to check which ones perform the best. Local advertising is an easy choice for high margin services.

But if the scenario is opposite, local ads can still be used to build customer lifetime value by bringing in loyal, repeat customers. By retargeting and staying top-of-mind with first-time customers, you may be able to win their repeat business, which will more than justify the initial acquisition cost.


Industries benefiting from local advertising


96% of SMBs say they include social media in their overall marketing strategy; 17% of them invest in search engine optimization. Have a quick look at the average CTR across multiple industries:

Average Click-Through-Rates (CTR) for Facebook Ads by Industry

Source: EMGI Group


If you are still concerned about whether or not local advertising will yield favourable results, here are types of businesses that benefit:

1) Brick-and-mortar small businesses with margins in excess of $10

  • Mid-to-high-end restaurants
  • Retail firms
  • Beauty salons
  • Fitness centres

2) Professional service providers with a physical office/firm

  • Lawyers
  • Accountants
  • Consultants

3) Service Area Businesses (SABs)

  • Plumbers
  • Repair companies
  • HVAC companies

4) Tourism

  • Local tour guide companies

5) Other lower-margin businesses

When it comes to such companies, it all comes down to the customer lifetime value (CLTV). If it costs a $3 CPC to bring in one customer (off of which, you might only pocket $1 from a single cup of coffee), you’d see a negative return. However, if that customer regularly comes back, their lifetime value would be much greater than that initial cost per click.


Over to you


If you answered yes to any of the questions above, then local advertising might just be for you.

Of course, deciding on taking the plunge is just the first step. Fortunately, we're here every step of the way with technology and content aimed at making your venture into local ads easy, effective, and economical. To learn more about local advertising, subscribe to our blog or follow us on Twitter.

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