Best Local Advertising for Small Business

A good local advertising strategy should consider local SEO, community building, referral marketing, paid ads, and offline channels. Here are 6 local advertising tactics for small businesses.
Written by
Jennifer Chu
Published on
August 1, 2024

Most business that rely on local customers (eg a restaurant, dental practice, school or workout studio) underestimate the effort (and need) for marketing their business locally. Some make the mistake of assuming word-of-mouth and foot traffic will be enough to generate awareness of a new or small business.

However, local marketing strategies can significantly impact the success of a local business. A well executed strategy can 1) attract nearby customers and 2) build a community presence. Below are some proven methods -- organic, earned and paid -- to advertise your business locally:

1. Optimize Your Online Presence

Google Business Profile (GBP)

We’ve talked extensively about the importance of optimizing your Google Business Profile. It’s a powerful and free tool that every business who meets customers in-person should take advantage of. Your GBP is how people searching in Google Maps and Google Search (such as in “near me” queries) find your profiles, read reviews of your business and lookup your address and hours of operation.

If you haven’t already, read how to generate organic visits to your Google Business Profile.

Local SEO

Local SEO leverages the fundamentals of SEO. You’ll still want to target keywords in your content and meta tags, but you’ll want to also use location modifiers.

  • Content
    Target location-specific keywords, such as "mochi donuts in NYC" or "dentist in financial district." Include these keywords on your website, particularly your Title, H1 and Meta
  • User Experience
    Your site should include pages with SEO rich text for each of your services or products offered.
  • Authority
    Get listed in local directories to get backlinks which can improve your website’s search rankings. Try collaborating with local businesses and events. One of our clients, a local Chinese preschool, recently collaborated with the Museum of Chinese Art and subsequently received a backlink from a high-authority site.

2. Leverage Social Media

  • Choose the Right Platforms
    Be selective on where you invest your efforts. Content creation is a lot of work.
    Focus on social media platforms where your local audience is most likely to engage with your content. A beauty salon will have visually appealing that performs well on Instagram, but a B2B agency might do better publishing and networking on LinkedIn. You’ll have to resist the FOMO urge to do something just because everyone else is doing it.
  • Share Local Stories
    Highlight local customers, events, and partnerships. This fosters community engagement and strengthens local ties.
  • Engage Audience
    Engage with your audience by responding to comments and messages. Use polls and questions to encourage interaction.
  • Use Geotags
    When posting on social media, use location tags to reach a broader local audience.
  • Engage Local Influencers
    Partner with local influencers who have a strong following in your area. Their endorsement can introduce your business to new customers.
    Pinch Chinese in NYC's Soho is featured here in @RestaurantGroupie’s Instagram.

3. Participate in Community Events

Sponsorship Opportunities

Consider sponsoring or attending local fairs or charity events that align with your business and customers. Your brand can gain visibility in the right events, as well as backlinks that can help with SEO. I’ve seen pediatric dental groups host booths at summer camp fairs and hand out toothbrush kits.

Host Your Own Events

Organize workshops, seminars, or open houses at your location to draw people in and showcase your offerings.

Imagine Swimming offers free mommy and me swim classes for infants to generate leads for their paid classes for babies and children.

Free swim classes to attract new customers

Network

  • Chambers of Commerce
    Join local business groups and chambers of commerce to network with other business owners and potential customers.
  • Networking Events
    Attend and participate in local networking events to meet potential customers and business partners.

Collaborate with Local Businesses

Partner up with local businesses that complement your products or services for cross-promotions. You'll each expand your audience reach by tapping into each others followers.

This Ya Ya Preschool partnered up with local bakery, PS & Yao, for their first pop-up in Manhattan. And, the event got shared by @soha_eats to her 32.2K followers.


4. Get Referrals

Your best customers can often act as a highly effective and inexpensive marketing engine. Referral marketing is when a business encourages customers to recommend your offering to their friends, colleagues or family. Referrals are typically high-quality prospects with a high likelihood of purchasing, because they’ve heard about you through their trusted network and are already informed about your business.

Encourage more referrals by offering rewards to the referrer and/or referee. Ideally, you choose an incentive that is part of your business and lower cost. For example, you could offer discounts on membership fees, a complementary product, or a gift card to your store.

5. Utilize Offline Marketing

Traditional offline advertising can still work, but you have to be analytical and strategic with the publishers and channels you work with. Because you’re paying for these ads upfront, you should run the numbers to see which channels and formats are most effective. Try testing on a small enough scale to limit budget and potential loss, but large enough that you can have enough sampling data to infer some insights.

Before you start paying for ads, it might be helpful to run some back of the envelope calculations where you can. To do this, you’ll need the following info:

Your Business Metrics:

  • Customer Lifetime Value (LTV)
    LTV is how much a customer is worth to your business over the lifespan of your relationship with them. In other words, how much total revenue can you expect to get from that customer?
    A private preschool may have an LTV of $60,000 (annual tuition of $40,000 and average lifespan of 1.5 years) while a restaurant might have an LTV of $400 ($50 per meal, 4 meals per year, 2 year lifespan)
  • Conversion Rate (CR)
    Conversion Rate is the percentage of users who took a desired action divided by the number of visitors to your site.
    Conversions are events valuable to your business that you define. Conversions could be an online purchase, a form submission or a call to your business. Note that in sales, conversions could also refer to the customers or sales you get out of the leads generated from a campaign.

Campaign metrics:

  • Campaign cost: the total dollar spend of the campaign
  • Click-through-rate (CTR): the number of clicks you receive divided by the number of people who see your ad or email

We’ll walk through some examples as we discuss the various paid channels for local marketing.

Direct Mail

Direct Mail is when you send physical mail in bulk to potential customers that you identify to match your target audience.

Local businesses can advertise their offering by send postcards or promotional materials to residents in specific neighborhoods. Direct mail campaigns can be particularly helpful when your target audience isn't online much or might have a harder time finding you online.

As old school as it is, direct mail can be a surprisingly effective channel. The USPS has a program called “Every Door Direct Mail” or EDDM where you can build a list of addresses based on zip code, street name or neighborhood and filter by things like household income, age and household size. Realtors frequently use databases that can tell them the addresses of homes sold during a certain time frame, so they can target potential clients who might be ready to sell their homes.

While direct mail can be an effective channel for broad offerings, it may not be the best fit for a niche or low-cost offering.

Estimate Your ROI

For example, let's say a summer camp is considering testing a direct mail campaign to advertise their new program. They charge $1,000 per week, and most kids attend their camp for five weeks across two years. The average LTV is then $5,000. They place a QR code on the mailer that allows users to go to the site and sign up:

  • The cost for mailing 1,000 pieces at $0.223 per piece is $223.
  • The cost for printing a 1,000 5x7 postcards starts at about $225.
  • Total cost for this campaign is $448.
  • The response rate from direct mail ranges from 0.5% to 3%. Let's assume 1% — which would mean 10 visits to the website.
  • The conversion from website visit to camp sign-up is estimated to be 5%. We would get 0.5 student enrollments or $2,500.

The conclusion I would draw from this is:

  • The campaign could work: 
    • You generally want an LTV / CAC of 3 or higher
    • $2,5000/$448 = 5.6
  • But, 1,000 mailing pieces is not enough to get good data
  • If you are going to run the campaign, I would consider testing a larger send of perhaps to 4,000 to 5,000 addresses. It becomes a balance of your ability to spend on marketing and getting enough data to test effectiveness as well as messaging and offer.

Direct Mail Performance Levers

Response rate can be influenced by several factors, which can in turn skew your outcome higher or lower:

  • Offering appeal: An offering with broad appeal will do better than a niche offering
  • Pricing or discount: A high-priced offering will get a lower response rate than a low-priced offering. Presenting a discount can also make the service or product more attractive to trial or preview.
  • Address List: does the neighborhood or demographic your are targeting align with your business? In our example, you would want higher income families with children up to 4 years old.
  • Design: Does the postcard or mailer have a graphic that appeals to your audience? For a summer camp, try showcasing outdoor activity photos or a sample project the parent can do with the child at home.
  • CTA: what is the call-to-action? Is it filling out a preschool application online or attending a free school tour first?

Conversion rate can also be influenced by the mail piece.

  • Some leads can be higher quality than others. Offering anything “free” on the mailer can get you a high response rate but may not convert into sales.
  • Aligning the mailer’s messaging with that of the website can help maximize your conversion rate.

Direct Mail, like all other channels, benefit from repetitive exposure and variable testing. A campaign that performs “okay” may be worth trying again, while tweaking the audience, messaging or CTA.

Print Advertising

Local Papers

Print ads in local papers, although seemingly fewer and further between, are another avenue for promoting your local business.

This facility that treats varicose veins has been advertising daily in every issue of AMNY, so I presume it's working? I guess it makes sense, given that readers of are consuming this publication during morning and evening commutes where many people are standing for long rides.

Flyers and Posters

Distribute flyers and posters in strategic locations like community centers, libraries, and cafes. Some places may have strict rules about unsolicited ads, so check first with the owners or managers.

6. Run Paid Online Ads

Google Ads

Google Ads makes it easy to set up ads on any budget. The most targeted way is paid search, also called pay-per-click ads, where you can buy ads on keyword searches, like “indoor playspace” or “nyc stem camp”, and geo-target users in states, cities or other locales.

Clicks can be expensive, but the quality of the traffic you get from paid search tends to be pretty good — ie high-intent users who have a relatively high chance of purchasing.

Google Ads also offers other types of campaigns, like display and video with goals such as website traffic, leads and phone calls.

Facebook Ads

Facebook ads, on the other hand, help you identify people with interests that overlap with your target customer. A bilingual spanish school might target users in New York, NY that are parents of school-aged children who have Spanish Language interests:

Targeting critieria for Local Facebook Ads

Facebook Ads tend to be “cheaper” than Google Paid Search in that clicks from the ads and traffic to the site cost less. But, conversion rate is also lower as these users may not be actively searching on your offering. Rather, they happened to see your ad while on their Facebook app.

7. Offer Promotions and Discounts

Exclusive Local Offers

  • Special Discounts: Offer exclusive discounts to local customers to encourage them to choose your business over competitors.
  • Loyalty Programs: Implement loyalty programs that reward repeat customers, encouraging them to return.

Seasonal Promotions

  • Holiday and Seasonal Sales: Run promotions tied to local holidays and events, such as back-to-school sales or holiday specials, to attract more customers.

7. Engage in the Community

Volunteer Work

  • Community Service: Participate in or sponsor community service projects or organize volunteer events. This enhances your brand image and shows your commitment to the community.
  • Charitable Donations: Make donations to local charities or sponsor community initiatives to establish goodwill.

Educational Workshops

  • Free Workshops or Events: Offer free workshops or educational sessions related to your business. Showcase your expertise.

Conclusion

Promoting your business locally involves a mix of online and offline strategies. By optimizing your online presence, leveraging social media, participating in community events, collaborating with other local businesses, utilizing traditional marketing methods, offering promotions, and engaging in community service, you can build a strong local brand and attract more customers. Consistency is key, and authenticity is crucial for community engagement.

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