Andrew Jones

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Consumer Behaviors, Technology & Disruption

June 24, 2013 at 11:01am
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Local Marketing’s Changing Landscape

In a recent Techcrunch article about Waze’s acquisition, one of the topics was “The big potential of local advertising,” which touched on Waze’s location-based ad platform.

Two big points made in that section:

1. Many of the big tech companies have been looking to make a splash in local, whether it’s Foursquare, Yelp or Facebook, and many more are trying to get there.

2. Local, mobile advertising spend in the U.S. is expected to skyrocket over the next few years

But that doesn’t paint the whole picture. According to a recent CMO survey, 59% of national brand marketers say local marketing is essential to their business growth and profitability – yet only 7% say they have highly evolved campaigns in place that can activate consumers at a local level.

This huge disparity between the desire to reach local audiences and the ability to do so effectively is causing marketers to spend more (91% expect to spend the same or more on local marketing in 2013 compared with 2012. Source: National Brand Use Of Digital In Local Marketing, Balihoo Q4 2012) despite lacking confidence in their efficacy.

Part of the difficulty is that online local consumer technology has limited adoption and is heavily fragmented. Yelp has done well in the restaurant and local business review category, but what about local events, breaking news, development, government and others? Amazingly, newspapers and TV still hold the top spots (Source: Pew Internet & American Life Project Project for Excellence in Journalism, April 2012).

Local online advertising is targeted and measurable, causing many marketers to focus there. Same for social media. Beyond in-house efforts (corporate website, email, and events), the top three customer touchpoints of local engagement strategy are online advertising and social media advertising (tied at 57%), and general social media engagement (56%).

Google and Facebook in particular have been pushing hard to expand their local-targeted offerings and get a bigger piece of the growing local-digital pie. With the purchase of Waze, Google gets a better way to do so and keeps Facebook from gaining ground.

In the future we’ll see more new consumer technologies that will challenge TV, newspapers, and radio as the dominant forms of access to local information (like Waze with traffic). We’ll also see a growth in technology that helps brands target consumers at the local level  tech that will build on existing data sources as well as new local offerings.