Home » Marketing Strategies » BullsEye! Hitting the (Right) Target with Local Marketing

BullsEye! Hitting the (Right) Target with Local Marketing

J.P. BeauchampJ.P. Beauchamp

Posted on Wednesday, June 27th, 2012

Thanks to the Internet, today’s shoppers can purchase anything they want, from anywhere in the world. Yet, most people still prefer to shop close to home. In fact, Internet2Go found that U.S. consumers spend roughly 80 percent of their disposable income within 10-20 miles of their homes.

Despite this dramatic propensity toward local shopping, most retailers target consumers at the national or DMA level. With these blanket campaigns, brands pay hefty advertising fees to reach overly-broad audiences, blindly hoping that the right people will see their ads or clip their coupons. And as a result, multitudes of consumers open their newspapers each week to find unwanted, irrelevant ads from stores 50 miles away where they’ll never shop.

Luckily, there’s a better targeting method. To get in front of the best possible audience and drive in-store purchases, brands and retailers need to localize their marketing efforts. Local targeting increases customer engagement, maximizes ROI, and guarantees that key messages will reach the most relevant audience. Localized advertising is also much more cost efficient, since campaigns only target only the most receptive consumers. Finally, consumers appreciate and respond to local targeting: Internet2Go found that 80 percent of consumers prefer ads that are locally relevant, while mobile network ThinkNear says simply mentioning a location or city name in a mobile ad can improve click-through rates by 200 percent.

So, how can brands and retailers determine who to target? To pinpoint appropriate neighborhoods and geographic areas, marketers start with a broad range of granular, executable demographic information, such as household income, household size, age, ethnicity, health, and retail purchase history. This data will provide an accurate picture of an area’s residents, which can then be compared to an ideal shopper profile. Marketers should focus on areas that most closely fit their ideal profile and will be most receptive, and skip areas that aren’t a good fit. Target neighborhoods should also have access to a brick and mortar store.

With priority regions selected, retailers can effectively execute any number of marketing strategies. For example, retailers can use neighborhood pricing, charging slightly more in affluent areas, or offering greater savings in lower-income areas. National brands can tweak their messaging for different areas with geo targeting, a digital advertising method that shows individualized content to website visitors based on their geographic location. Local targeting also lets retailers find the best possible regions to introduce and test new products and platforms.

The last key step in local marketing—ROI measurement—is often overlooked. A recent Balihoo study of marketing professionals from more than 270 national brands revealed that 58 percent of national brands do not calculate ROI for their local programs, and 25 percent of North American advertisers do not have a means to track local ROI. Stay tuned for an upcoming SymphonyIRI blog post on the benefits of local ROI measurement and strategies for tracking success on a local level.

Until then, have you had success with a local marketing or advertising initiative? What approaches have you taken to reach success locally?

2 Responses for "BullsEye! Hitting the (Right) Target with Local Marketing"

  1. Randy June 27th, 2012 at 10:37 AM

    You are correct that local marketing is critical for retailers, but your statement that most do it at the National or DMA level is inaccurate, especially as it pertains to newspapers. In fact, most retailers target by zip code through ad circulars and some even go below that level, with literally dozens (even hundreds) of ad versions nationally. Ads are versioned for product and price variances and this has been done for the better part of two decades in newspapers.

  2. Sangita Ray July 25th, 2012 at 10:15 PM

    Targeted/local marketing is definitely the way to go as it makes promotion as well as distribution more efficient, convenient and cost effective for retailers. Mass marketing is a practice of past now in the entire retail industry. Reaching individual communities with specialized messages, though tedious than mass marketing, yields better ROI and results in higher customer acquisition as well as retention.

    To create a robust local marketing strategy, including feedback-gaining techniques from local audience through online/offline channel is critical. Also, connecting with local community and/or partnering with another established local business might reap huge benefits.