Major Advertisers to Increase Local Marketing Efforts

U.S. consumers have the option to purchase their goods and services from a locally-​owned business or the local branch of a national company. To compete more effectively, national companies say they need to improve on their localized marketing efforts. A new study from the CMO Council shows the challenges marketers face in this arena and the changes they are likely to implement as they focus on the local market.

Currently, national companies say their preferred channels for local marketing include direct mail, local websites, experiential events and text messages. Surveyed executives also report that traditional media like TV, radio and magazines fail to deliver a return on investment at the local level. And daily deal networks and all forms of Yellow Pages fared poorly in this study. About half of surveyed national companies are unhappy with their current local marketing capabilities and effectiveness. Nearly 1 in 4 (23%) spend about 50% of the marketing budget on local. A much larger number, 41%, directs between 20–50% of marketing budgets to the local programs.

Marketers participating in this survey are often frustrated by their inability to understand how each local market works (30%), to find the proper cost/​benefit model for spending allocations (24%), and to measure campaign effectiveness locally (23%). Market variations which must be considered range from cultural history and dominant language to geography and climate. And socioeconomic factors are also important.

To improve their position in local markets, leading companies say they plan to:

  • Automate development and delivery of local marketing materials
  • Test local marketing strategies
  • Use more localized channels
  • Increase localized marketing budgets

In a similar study published by Retail Systems Research earlier this year, analysts encouraged retailers to increase their cross-​channel efforts and to use small details like store location in their TV and print ads. Another suggested strategy was to promote local store events in both traditional and online advertising.

[Sources: Localize to Optimize Sales Channel Effectiveness. CMOCouncil​.org. Fall 2011. Web. 7 Nov. 2011; State of Localized Advertising in Retail. Retail Systems Research. July 2011. Web. 7 Oct. 2011] 
Kathy Crosett
Kathy is the Vice President of Research for SalesFuel. She holds a Masters in Business Administration from the University of Vermont and oversees a staff of researchers, writers and content providers for SalesFuel. Previously, she was co-​owner of several small businesses in the health care services sector.