Let’s talk about one of our clients that owns a chain of pizza restaurants, but for the sake of privacy, we’ll call it “Sun Pizza”, or SP for short. They’re a small chain of specialty restaurants that use wholesome ingredients in their food, and prepare it fresh as you order it. SP is not like Domino’s or Pizza Hut. They are upscale, not fast food. They don’t have thousands of locations, but just a few hundred in various shopping malls. Yes, they serve pizza, but the audience, method of marketing, price points, and value propositions are quite different. First, ask yourself, What would make a consumer want to buy from SP instead of the other pizza places? We’ve described that Sun Pizza prepares their food fresh, so targeting the health conscious and sticklers for flavor is recommended.

Location, Location, Location

Since Sun Pizza isn’t in every city, it doesn’t make sense to buy generic keywords for everywhere. We’ll say there are locations in 33 out of 50 US states, so you’d want to exclude not only the 17 states that they don’t have, but not show ads in areas that are more than 10 miles from any other location. You could get really fancy about geo-targeting, but it is probably sufficient to start with just a few geo-targeted campaigns aimed at the top DMAs, or Direct Marketing Areas, which are major metropolitan regions, for example, when promoting a site that lists garage sales. If we were selling headstones and caskets, then we’d multiply the 300 DMAs in the United States against our set of generic terms, creating one master national campaign of 300 ad groups, then separate campaigns for each DMA that we wanted to geo-target. If you are doing this for a single location, then you just have two campaigns, one nation with geo-terms and one geo-targeted with generic terms. However, if you’re selling something like ringtones, then geo-multiplication might not make sense.. Once you learn what works in one master campaign, you can then propagate to all the others. Also, don’t forget to create local business ads, if your client has a physical location.

Avoid Premature Optimization!

Among other things that are premature, scaling out campaigns too fast will cause you to be embarrassed with your PPC partners. Since geo-targeting is at the campaign level in Google (but can be done at the ad group level in Yahoo!), if you have 300 locations, that requires 300 campaigns. If each campaign is split by search versus content, then you now have 600 campaigns. With a limit of 25 active campaigns in Google per account, that would already be 24 accounts to manage. Spinning out that many accounts would be premature optimization, even if you have tuned your scripts to post these through the AdWords API in a snap. Make sure you learn what works in one or two prototype campaigns first, else you risk building combinations of keywords that have absolutely zero traffic, solving problems that don’t exist, and basically wasting your time. And if you have 300 ad groups that are essentially duplicates, when you change the master, say, add new keywords, change bids, put in new ads, you then have to propagate to the 299 other slaves. Even if automated, you still bear API usage costs, which can eat up your budget in a hurry. I’ve had days where I’ve spend a few hundred dollars alone on API usage charges.

The point here is to start with a couple of hand-built campaigns and tune until you have something that is reasonably good, then scale to the moon. If you’re doing geo-targeted campaigns, start with one or two test campaigns, don’t start in NYC or some metro that is a uniquely monstrous challenge.

Users tell you where they are

Depending on whose numbers you use, the percentage of searches that are local is between 20 and 30%. At the low end, the user explicitly includes the geo term in their query: “omaha dentist” (by the way, I’m not counting “sun pizza” or “boston market”, where the brand name has a geo term in it). Someone could be searching on “toyota dealership” by itself, upon which you infer that’s it’s a local search and determine where they are based on geo-ip. So include the inferred local searches and almost a third of searches are for someone looking to buy a product or service in their neighborhood.

Thus, you can determine local via either the user’s search term or via their IP address:

• With the search term, you do geo-multiplication against your geo list and generic term list, 50 geo terms and 100 keywords and you’re at a 5,000 keyword portfolio all in the same nationally targeted campaign. Be careful of cities and neighborhood names that are not unique. For instance, if are looking for a Louisville Roofing Company, you could be attracting traffic from both Louisville, CO and Louisville, KY. There is also a major risk of multiplying too far, where you’re multiplying a low population zip code against a low volume search query. In geo-multiplying, our experience is that you only need to take the top 3 city names in the local area, multiplied against the top 10 things that you or your client do. The drop-off after is so steep that the long-tail becomes non-existent.
• If going by IP address, you have to multiply campaigns, each with different geo targets. In our experience, the geo-targeted campaigns in aggregate should give you more traffic than your single nationally targeted geo-combo campaign. However, you will have many more geo-targeted campaigns. By the way, I highly recommend that you sign up for Shoemoney’s amazing local affiliate tools, which will simplify much of the drudgery I’ve laid out above.

Give them what they want

Now that you have your targeting in place for your PPC ads, you have to make sure you have the right message aligned with the right keywords. Organize your ad groups such that you could show the same ad on any keyword in the ad group and know it will perform just as well. For example, have one ad group for each product and service. But don’t create a zillion ad groups needlessly. For example, “pizza” and “pizzas” should not be in separate groups. However, “order pizza” and “pizza menu” should be separate. If you’ve got the keywords grouped together by similar intent, then it’s a simple matter to make sure that you have a relevant and and landing page to show them. Use Quality Score (Google) and Quality Index (Yahoo) as a double-check for relevancy. Use Google Website Optimizer if you want to test your landing pages.

Show up in map and natural local search results

PPC is not the only game in town. There is a ton already written on Google Local Business Center, Yahoo Maps, and various other free and paid directory players. Google Local Business Center is perhaps the grand daddy of all of these guys because of the volume of traffic you can easily drive via the Local 10 pack results which sit above the regular organic results, it’s the map with the 10 listings, and the sophistication of the tools they provide. Even if you have 5,000 locations, and we have some clients who in this range, you can bulk upload all your listings. But optimizing each of these listings for each directory is something that will either take you a ton of time manually or for which you have to employ some clever automation. You didn’t hear me say to spam Craigslist, but I did say there are ethical, white hat methods where you can get your raving customers to go in and stack the customer reviews, which will bump up your rankings.

One major error we commonly see with retail clients is to list all their locations on a single page that is a mile long, versus having one page per location with semi-unique content on each page. How do you have unique content on each page if you have 5,000 franchise locations that all sell the same thing? You use the “Mad Libs” approach with templated content. Welcome to {city} {category} for the best in {subcat1}, {subcat2}, and {subcat3}. We’ve been doing {category} in {city},{state} and {region} since {founding year}. And so forth, making sure that the auto-generated content is not exactly identical. Then, allowing fans and employees to blog and comment will increase level of unique content. Good SEO on these pages will help your listings show up in map and regular organic results. Make sure that you don’t make any of the fatal SEO errors that we usually see:

• Check for canonical domain issue: Do the www and non-www version of the homepage go to the same url? If not, then look at www.mattcutts.com/blog/seo-advice-url-canonicalization/ for an understanding of how duplicate content should resolve to a single page.
• Dynamic looking urls: the site should not pass parameters in the url. For example, mysite.com/?page_id=34&section=2&session_id=123abc is no good. Question marks and equal signs in the url mean that parameters are being passed. Instead, the url should look like mysite.com/large_blue_widgets
• Text vs. Images/flash: Search engines cannot read images or flash, they need text.
• Unique page titles: Do not start the page title with the name of the site unless it’s a strong brand. Make sure each page title is reflective of what that particular page is about.
• Sitemaps: There should be a link to “sitemap” on the home page—and that sitemap should have links with anchor text that are key search terms
• Run SEO reports: Put in the client’s url at SEOMOZ Page Strength. This site gives you a couple dozen SEO metrics
• Run PPC competitor reports: Go to SpyFu and do a few searches. Put in a few keywords that you think are important to the site, plus the site url itself. If you’re looking at a keyword, it will come back with who is buying it on PPC, what it costs, how many clicks are available, and what terms are related. If you’re looking at a url, it will tell you what terms (if any) they are buying on Google, what terms they rank naturally on, and who are related competitors.
• Examine the Source code: Do a view page source from your browser, starting from the home page. Do a search for H1 and see if any come up. If so, are they using keywords that they want folks to find them on? H1 tags carry more weight than regular text, but are not as strong as the page title.
• Look for Analytics code: While still on that view of the code, find instances of “google”, “analytics”, or “urchin”. You may also see examples of other tracking software, too, towards the bottom of the body.
• Validate Your Source: Go to W3.org and put in the url. Like the other tools, it will return usually a few dozen errors with explanations.
• Use a Toolbar for “at a glance” SEO: SEOQuake is a great Firefox browser plug-in to show you Google PR, pages indexed by Google, pages indexed by Yahoo, backlinks, age of site, and Alexa rank

Measure conversions

If you’re not tracking conversions, you are flushing money down the toilet, Period. There are several vendors that will give you hosted call tracking for a few dollars per number month, allowing you to have a web-only number that forwards to the nearest branch location. And you should pixel email signups, shopping cart checkouts, and any other conversion event that you can assign a value to.

By the way, put branded terms in their own groups, since they will convert better and have higher volume. Most users don’t know the difference between the search bar and address bar, so they’ll navigate to your site via the search engine. Thus, you can’t really take credit for those sales, as most would have come to you anyway via natural search. That’s not saying you shouldn’t bid on your own name or that of competitors, You have to be smart about it and measure the level of cannibalization occurring. For a more sophisticated treatment on conversion optimization, check out my presentation on Advanced PPC tactics at SMX Sydney last week.

Optimizing your campaigns

Now that you’ve built your campaigns, tested them to the point of being stable, and then used programmatic methods to scale them out, you have to optimize budgets. Do you have any keywords that are still inactive? Are you more than 10% off where you should be pacing on your monthly budgets? Then either adjust your bids or change your budgets. Go back to the keywords tab and sort by minimum CPC bid descending. Look at anything that is $5 or higher, since that is a “Google slap”. Google thinks that your ads and landing pages have very little to do with that keyword, so they are forcing you to bid a certain amount to even be able to show your ad. This is not the same as your average CPC being high. You can be paying $10 a click because you’re bidding on a highly competitive keyword, but with a decent Quality Score, your minimum required bid can still be 50 cents. The latest version of AWE now shows Quality Score, else you can get it on the web. Look at any keyword that is not at least an 8. If anything less, then you need to re-group keywords into tighter themes, write new ads, and find more relevant landing pages.

Final Words
So there you have it. Whether you have a few locations or 5,000, these are relatively easy steps you can follow to drive measurable traffic to your office, car dealership, franchise, or other locations. If you want to get fancy, you could even do PPC via Facebook Self Service, update a Twitter account, or build a full-blown Facebook game. I hope you found this helpful. If you have any questions, feel free to drop me a line at dennis@blitzlocal.com. If perhaps this type of work is something you don’t want to do in-house or you would prefer assistance from folks who do it professionally for a number of Fortune 500 clients, we are happy to talk to you about our service offerings.

Let’s first address the size of the local online advertising market, then show why these masses will have a good shot at finding success in 2010, but haven’t before. If you don’t like stats, skip down to the red text below and start reading.

Borrell Research, in their 2009 “Main Street Goes Interactive” report lists 14.6 million small businesses online in the United States.  Kelsey claims 18 million. Other Yellow Pages publishers claim upwards of 22 million.  Whatever cut-off you use for small business– if you include lemonade stands and folks selling tupperware or beauty cream at night– the price point for these small businesses is $500 a month for advertising.  That’s not just PPC or even online marketing to build websites and run email campaigns– that’s the whole budget for everything.

For paid search, these businesses spend an average of $261 on paid search per employee per year– keep in mind the lie of averages, since you’re accounting for companies that spend zero, as well as those hobbyist businesses. That $261 represents 11% of the total ad budget, which works out to $2,373 per employee per year.  Assuming the average small business salary is $35k, then advertising is 7% of labor cost– low for professional service firms, but high for a retailer.

• SMBs (Small and Medium Businesses) spend on average only $267 per year on their website (hosting, development, and support).
• While all businesses spend only 26% of their online marketing dollar on advertising, SMBs spend 83%.
• While all businesses spend 67% of their online dollars on support, small businesses spend 9.3%.

Why?  They can’t afford custom development for just a couple hundred dollars.  And the ones doing paid search are using self-serve with budgets of a couple hundred dollars a month– way too small for an agency to pick up and provide a listings product, PPC campaign, site development, email autoresponder, call tracking, and the significant consulting (client education) needed to make this happen.

The small business sweet spot is $500 a month and under, while the price point in the market to truly deliver value (there are players who are less than $500 per month, but don’t deliver the full solution needed) is $2,000 per month. That gap will close in 2010.

The way it will close is through the intersection of local, mobile, and social.  The research we did at Yahoo! showed that small businesses are not comfortable with self-serve, no matter how “simple” we try to make creation of PPC campaigns, building a site through templates, setting up email autoresponders, and so forth.  Too daunting, not enough time, too expensive– and therefore it remains untouched.  The stats from 2007 were that 87% of small businesses were aware of PPC, but only 9% of them were actually doing it.  This gap underscores the point.

Video game dynamics teach users complex systems of rules via a gradual leveling and unlocking mechanism– starting from a basic set of operations and gradually revealing new features and options until players have learned the game. You can read here about these mechanisms and how they apply to Farmville, your local supermarket, learning to read, or other activity by checking out this post on social game dynamics.

Now these games have moved from the desktop to your phone– and now there are games such as FourSquare, Gowalla, and Poynt, where you can earn virtual currency in a giant, real world scavenger hunt. And the phone knows where you are, can take pictures, can collect data in ways that PC’s can’t.

And the social networks have now amassed the social graph in ways that makes game dynamics truly possible.  Facebook recently shot through 350 million users worldwide and is now 25% of the traffic in the United States– that’s 1 in 4 pageviews across ALL traffic in the US–

So now you have a mobile crowd that is connected to the social graph, earning incentives to record where they are and gather information on local businesses.

THIS is your salesforce. This is the borg that will assimilate you into the hive– the stay at home moms that will earn points for enrolling small businesses into BlitzLocal, playing a video game that happens to earn them real dollars.  This is the army of local entrepreneurs, playing not FarmVille, but BlitzVille.  We’re not calling it that, but you get the idea. Watch as thousands of stay at home dads, motivated by online video games designed to enroll small businesses use a system that simplifies the process of online marketing for local businesses.

And the small business will receive personal service from their friends, a measurable result from the system that they’re using together (after all, video games are all about clear rules), and have a good time while they’re at it. No more hard sell, no more being handed off to the next available call center agent (he says his name is “Peter”, but you know it’s not from his accent).

It will be interesting to see how the traditional model of aggressive direct sales fares in the open, social, local, mobile approach:

• Consider how they will react when small businesses demand transparency (just show me the CarFax) on how much of their dollar is actually being spent on ads versus sales commission and overhead.
• How will they deal with margin compression when their model of having multiple people involved in the process– sales, operations, engineering, support– gets squeezed down when the local/social/mobile approach requires just one person who is eager, well-educated and already has a relationship with that client?  The direct sales model has 30% of cost in sales and marketing, while the local/social/mobile model has no traditional advertising costs.
• How will the traditional sales model deal with a price point that will drop below $500 per month– maybe to $200 per month– ye still be forced to drive as much value at the previous $1,000 a month packages?  You’ll see a deflationary impact just like the rapid obsolescence of computer equipment.
• And to the software sellers, who are licensing software for $200 a month– so they do meet the price point– how will they solve the “last mile” problem of collecting enough data from that small business owner to be able to create a website that is compelling– that won’t waste the traffic that comes from a templatized PPC campaign?  The SaaS (software as a service) model of monthly software fees is appealing for its scale and ability to sell at low price points, but will fall down for not being able to integrate service.  If service weren’t necessary, then everyone would be on Adwords and WordPress already.
• What will the software and direct sales firms do when they cannot spend their way out of the margin issue, no matter how much money they raise– IPO or not?  If you’re selling $10 bills for $8, you’re not going to make it up in volume.

The model of local/social/mobile is:

• Akin to the open source software movement– a belief that the community can organize to provide products for nearly free and of better quality– that results should be transparent and that campaigns should be owned by the small business, as opposed to being held hostage so they can’t switch out.
• Keeping dollars in the local economy– to support local businesses, with anyone being able to start their own local Internet marketing firm to serve their neighbors honorably– to create a grass roots army of local Internet marketing experts.
• Employing stay at home moms, students, and anyone who is well-educated, but can’t work full-time in sales. We’ll tap into the labor market of part-time and underemployed folks, who might not be trained professionally in Internet marketing, but can use our systems to create results as good or better than the “big firms”. They might have a Masters degree, but need to spend time with the kids. Or maybe they just don’t want to work in an office 40 hours a week.

If you want to join our team, see our training processes, or even try our product for free, just drop me a line.  Gamers of the world unite. You will be assimilated.

Tricky question, so let me answer it this way:

To measure penetration, we need both the numerator (number of businesses that are using IYP, traditional YP, and BBB)– divided by the denominator ( number of locally-focused businesses).

For the denominator: the traditional number bandied about at tradeshows for local biz in the US (I’m assuming you’re looking at just US for now?) is 16-23 million businesses. However, that’s a highly distorted number, since that includes “hobby” businesses– grandma selling her custom-woven socks and various part-time employment (MLM, ebay sellers, affiliates).

If you go by US census data, there are 6 million firms in the US and 7 million establishments (to account for multiple locations for franchises). Cut that down to the folks who are actually advertising in the yellow pages and you’re about half that.

Now cut out services that aren’t truly local (in my personal opinion), such as insurance or anything affiliate-related. You’re down to under 2 million.

Cut out restaurants and nail salons and you are left with 700,000– primarily professional service firms who have at least $250k in annual gross revenue and have at least 1 full-time employee.

This is the bread and butter of the yellow pages– dentists, car dealerships, restaurants, and attorneys. Net-net, depending on whose numbers you use for a numerator or denominator, you get IYP (Internet Yellow Pages) penetration of between 10 and 20% for claimed listings, and traditional YP penetration of about 50%. I asked Greg Sterling and off the top of his head, he said the 50% figure was about right.

I’ve asked folks at the BBB for their stats, since the latest I see is a few years old– will update when I hear back.

Thus, be very wary of the source of any stats you hear– there is incredible bias, depending on industry role:

• The YP folks (whether YPA or yptalk) like to say the yellow pages are not dead, but are actually holding flat at 84% usage by consumers and $30BN in annual revenue.
• The tree huggers like to say the YP folks are dead in a few years– also an overstatement.
• Then you have industry pundits who will write favorable reports about your company if you pay them a few thousand dollars (Clickable being the most egregious example).

So if you’re looking to sell software products that are under $50 a month, then you have 20 million potential businesses in the US alone, most of which don’t have websites or even enough money to do any more than sign up for a $10/month hosting package for a cookie-cutter site.

But if you are selling as an agency to local businesses that have $2k a month to spend online, then perhaps you have 500,000 firms to go after– the majority of which have websites and are doing some form of online advertising.

So don’t let statistics get in the way of the point you’re trying to make!  After all, there are lies, damned lies, and statistics.

Well, perhaps not traditional video games, such as Pac Man or Space Invaders– I’m talking about how every website is now incorporating game dynamics. But if you consider how Facebook, LinkedIn, FourSquare, MerchantCircle, Twitter, Farmville, or other sites operate, according to these game dynamics you’d be hard pressed to tell me they’re not video games:

• Points: Earn points for not just killing monsters, but fully completing your online profile and spamming your friends to join (LinkedIn and Plaxo).   You do want to be at 100% completion, don’t you?  Even Google is getting in the social media game with the 100 point scale for Google Local Business Center, as well as the “Favorite Places” program.
• Levels: And with more points, you unlock the next level. It’s amazing how hard people will work to get to the next level– for example, in Farmville, even though you’re not getting any financial benefit.  You can’t sell things, like you can with Diablo 2 items, World of Warcraft, or Second Life, where there are currency exchange markets.  The combination of earnings points to achieve levels is no different than the power of frequent flyer programs and MLM schemes. Name any forum and show how it’s not a video game to achieve ego.
• Collection: In Boy Scouts, you had badges to collect. Online, you have the same thing, whether you’re checking in to FourSquare, collecting more friends on your Facebook Fan Page, or trying to win that twitter contest for free Italian food.  You can be hooked on these games or Hooked on Phonics– the viral power is the same. Imagine how the US education system could be revamped with the viral nature of points, levels, and collection!
• Randomization: What do Las Vegas and Christmas have in common?  When you pull that slot handle or tear open that gift wrap, you get that moment of anticipation not knowing what you’re going to get. Email is the ultimate game of unwrapping Christmas presents– it’s Christmas every day.  Are you one of those who refreshes email every 90 seconds or checks twitter?  Then you’re hooked on that intermittent stimulation. The move to real-time search increases this ADD, such that every website creates this type of anticipation. 
• Community: You get rewarded to sell out your friends. But it doesn’t have to be doing so for promoting tupperware, unregulated health products, or virtual gifts in your favorite Facebook application. It can be used for recruiting local advertising resellers or even home schooling your kids.  Games are only interesting when your other friends are there playing it.  How much fun would Facebook be if you had no friends?  And your “score” is only valuable in context to those of your friends. How much advantage is your laser hair removal if all your friends already have it?

Now consider any website or business from the viewpoint of video games– points, leveling, collection, randomization, community– and see how it’s not any different than a big big real-world video game.  In the world of local online advertising, it’s not enough to create business listings, multiply out local PPC campaigns, or have a solid platform in general.  It’s got to be social.  

And in 2010, with the merging of local, social, and mobile– you’ll see game dynamics come together in ways that will astound you.  Unlike the desktop computer, the phone has a GPS to tell you where you are, a camera to read bar codes, and perhaps a gyroscope so you can shake, fake light saber battles– or do things that are actually useful for your business!

The world of online and offline is rapidly becoming one big video game– and portals such as Facebook, which have all your relationship information (in a good way) are going to make us all children playing for points.  They have the social graph necessary to make the game possible, such that we can all keep score– and pay, of course.

It’s all about finding quality people—that’s what Court Cunningham says is the biggest challenge for Yodle, the local lead gen of which he’s CEO.  You need skilled people to both bring in new clients and set up campaigns—for them, they have 140 people in a call center dialing through the phone books and directories.  Selling clients is easy—just tell them that the average client gets a 7 to 1 return. Thus, for every dollar they spend, on average they get back $7 in sales.

But the bigger problem is that of retention.  How do you actually deliver upon the promise of calls that lead to sales?  The small business doesn’t have much money, VC-funded companies have expensive office space, overhead to cover, and profits to generate.  Plus, if your agency’s focus is aggressive growth, good sales people cost a lot of money, which further eats into whatever remaining budget you have to spend on the client’s PPC campaigns.

Cunningham mentions that Yodle spends the majority of campaign budgets on IYP (Internet Yellow Pages)—listings fees and PPC spend, as that generates the highest ROI.  BlitzLocal takes a different approach—working more on the client’s website to get it ranking in organic (free) search results.  That longer-term strategy arguably takes more effort, takes longer, and is not as automatable as just running a click budget via Google.

By not having to touch a client’s website (whether building a new one or tweaking the existing one), it’s easier for Yodle to scale up their customer base. And should the customer wish to leave, all their traffic disappears instantly.  

By the way, Nathaniel Stevens is the founder of Yodle– the brainchild and super genius that started the company, NatPal, while still a student at UPenn. His original vision may or may not be reflected in the current company operations, which is no longer a start-up. We had dinner a couple months back to discuss– more on that another day.

We believe that the strategy that will win for the small business in the long run is to be transparent in our techniques, focus on a blend of natural and paid search traffic, and to help them integrate online marketing into their traditional marketing.  The downside of this is that BlitzLocal isn’t going to grow as fast.  But we believe that in the long-run, the marketplace will become more competitive and that we should be delivering at that level now.

It will be interesting to see who will win in the local agency space– the giant companies who are spending lots of money to grow as fast as possible or the myriad of local agencies (with just a couple folks each) that have clients in their own backyards.  My money is on the little guy, since there are a lot of unemployed bright people out there who are just starting to grasp the size of the local online advertising market.  Those folks will be more motivated than the corporate giants.  And we want to help them!

Sure, people are complaining about how Google gave $20MM to charities on our behalf, instead of giving us trinkets this year– whether they be a photo viewer, Flip video, or whatever.  But Google gave us some stuff that was far better than something you could just buy yourself at Best Buy. Look at these campaign features:

• Sitelinks in PPC ads: I won’t cover the ins and outs of AdWords sitelinks, but suffice it to say that this feature increases your CTR.  You can specify up to 10 links, but how many they actually show is usually just 3 or 4.
• Automatic matching: Scary, but Google will choose other keywords for you to show up on. Do you remember a couple years ago when Yahoo! just started tweaking people’s campaigns without telling them, causing advertisers to piss away money on irrelevant keywords– then get irate? Yahoo had the right idea, but was perhaps premature in the game of trying to simplify life for advertisers, as it was too big a step at once and didn’t actually improve performance.  The same naysayers of “expanded broad match” are complaining about Google’s move here. However, I don’t think it’s all that bad. 

Some considerations on Automatic Matching:

Yes, it encourages laziness. And will put in crappy words if your landing pages (which they crawl for keywords) stink.  If you have a great campaign already with tight ad groups and strong negatives, it’s unlikely they’ll be able to add much traffic. Otherwise, there is risk that your budget will get maxed out quickly.

You can still run keyword performance reports to determine exactly what keyword triggered your ad.  So in the same way that you run placement reports for content to weed out junky sites you’re showing ads on, you run a keyword performance report to see what new keywords you’re matching on, so you can then stick them in your campaigns or just negative them out. At the bottom of the ad group, they even break out the automatic match traffic, which is incremental to your regular traffic and doesn’t affect the rest of your bids, positions, or Quality Scores.

They do take into account location: Yes, so if you’ve got a franchised account with multiple locations, they will be smart enough to choose geo-modified keywords and pair them with the right ad and landing page. However, in Google’s semi-helpful FAQ on automatic matching, they caveat this by saying it works only when ALL the keywords in an ad groups are geo-modified.

You should try it-- but don’t just assume Google’s recommendations are going to automatically improve your campaigns.  It will certainly improve Google’s profitability, but not your conversions.  Unlike most tin foil hatters, I consider this feature– and anything else they roll out– good, if you watch carefully what you’re doing.  It’s effectively like the keyword opportunities tool, where they propose new keywords for you– except they’re automatically jammed into your campaigns.  Note that for this to work, every keyword in your ad group must be location-specific.

So between the improvements in Conversion Optimizer, sitelinks (beta only), automatic matching (beta only), mobile ads (who knows), and new local options, Google has given us a ton of new gifts for Christmas.  I’m surprised so few people are talking about it– perhaps because Google themselves doesn’t talk about it, instead just quietly releasing new features into the wild.

Tonight, I had dinner with Dr. David Verebelyi, Chief of Laser Surgery for the Colorado Center for PhotoMedicine.  They do liposuction in Denver, laser hair removal, and other laser-based skin procedures.  We’re doing cosmetic surgery on his website– not his face or butt!  We’ve celebrated one year with Dr. Verebelyi and he mentioned that in 2009, he drove 40% more business than in 2008, while paying 12% less in marketing cost.  

In fact, Internet marketing has been so effective, that he’s putting all his advertising dollars online– no print, radio, or TV. So before this blog post starts looking like a testimonial or marketing brochure, let’s talk about some interesting things we’ve learned this last year:

• Legitimate doctors are having trouble competing with spammers promoting weight loss products. By spammers, I’m talking about the fake testimonials and “flogs” (fake blogs).  Dr. Verebelyi and his staff actually do have celebrity clients, so how can he yell over the noise created by the folks who aren’t real?  Having a phone number and contact information prominent on the page helps, but many consumers aren’t reading that far.
• Social media is effective not for coupons, but when stuff is actually free.  Just like the above example, his office has offered small free services in the hopes that once a prospective patient comes in that they’ll sign up for other procedures. Twitter has been effective in promoting free services, driving folks into an email autoresponder process.
• Negative keywords and targeting are key to effective advertising. The young women and teens who want to just get a prescription and get right out are not profitable. So we have to demographic target and also use a heavy negative keyword list.  You don’t want to be paying $5 a click on a teenage girl who just wants to buy Clearasil from the supermarket.
• Before and after pictures are critical.  Patients want to see results and Dr. Verebelyi is one of the best in the nation based on his performance. He literally wrote the book on laser skincare techniques and trains surgeons nationally, as head of training for the American Society for Laser Medicine and Surgery. The funny thing is while you’d think that patients would care most about finding the best doctor (this is your body, we’re talking about– no discount heart surgeon for me!), price is still the #1 consideration.

Looking forward to 2010, we’re going to take advantage of Google’s latest features for local– ad extensions, sitelinks, Google Favorite Places, Facebook integration, and so forth.  And look forward to a new site in January– it’s not just Denver Botox, you know.

I look at ads all day– it’s part of my job. I even go out of my way to click on ads to see what competitors are doing.  So rarely am I surprised. But today I saw this:

  Yes, it’s an ad not promoting BlitzLocal, but actually targeting BlitzLocal.  How’s that for a taste of your own medicine? 

Shari Donnermeyer of Borrell contacted us yesterday about their local conference in NYC in February, asking if we want to come, as well as sponsor.  Previously, I was not considering going, since we just got back from the Kelsey conference in LA last week, which is the larger of the two shows.  However, now I’m seriously considering it.  

After all, I had mentioned in passing to Shari that I was getting bombarded on Facebook with ads promoting their conference– and that they were using the same creative over and over without testing various images, headlines, and such.  And now, this is what I see on my Facebook the very next morning– I’m impressed.

Tell me– how do you NOT want to go to their conference after seeing something like this?

This is an example of the kind of personalized advertising that is available only on social networks such as Facebook and MySpace.  It’s hyper-targeted, cheap, and effective.  How’s that?

I wanted to know whether Albertsons was still open, so I did a Google Search.  Here are the results:

As you can see, Google saw that my search query had local intent, since I have a city name and state.  And you can see they picked the two nearest Albertsons locations.  So far, Albertson’s is 1 of 1.

I call the phone number on their listing and got the number not found or has been disconnected message. Ooops– someone at Albertsons is not keeping their local listings up to date. Score: 1 for 2.

So I click on the link for their listing and it takes me to this page:

This is their store locator page, not the individual listing that I’d expect to see with the store map, locations, hours, items carried, and so forth. Score: 1 for 3.

Okay, well I’m already here, so let me put in my zip code of 80234, which is Westminster, Colorado– which should give me the nearest stores, right?  After all the url is locator.albertsons.com/StoreLocatorAction.  And here is what comes back:

That’s it– no store listings, navigation menu that lets me go to the albertson’s home page, nothing.  The message says there’s a store in my area, but it seems that Albertsons is not interested in telling me where it actually is.  If you click on the link they provide, asking you to view their press release, it goes to this page:

Whoa– I suppose it’s interesting that 3 years ago, Cerberus Capital Management bought out all the Albertsons stores.  But really, I wanted to know if I could do some late night grocery shopping.  How bizarre!  There is a link back to the store locator page, but I decided not to go through that same series of hoops again.

Folks, this is what happens when you don’t take care to manage your local listings.

• Have you made sure that your company locations are properly being submitted to Google, Yahoo, Bing, InfoUSA, Acxiom, and the 200+ other directories out there?
• Are you sure that the information is accurate and up to date, whether you have one location or 5,000?
• Do you take full advantage of what the search engines provide you with– to also input pictures, videos, reviews, rich descriptions, and even coupons?  It’s free, you know.
• Do you have a process to regularly monitor these listings so that you can add, update, and delete the locations that you have?

In audits, we often see over 40% of local listings with inaccurate data– that’s a lot of people you are denying to your stores. Let us run an audit for your locations and you might be shocked. Contact Eric.Evans@blitzlocal.com if you want an assessment, by the way.

We estimate that it would take you 30 hours to go claim and verify a listing for a single location across the top 20 sites.  The manual process of doing this is painstaking– you have to confirm a PIN sent via phone or postcard or respond to a phone call from a verification company weeks later.  The odds of getting it right are low.   Now multiply that 40 hours per location times however many locations you have– then you have an approximate cost to do it yourself.  If you do want to do it yourself, let us know and we’ll send you our guide on how to do so.

But if you’d like an audit, we have special pricing through the end of the year for $3 per location if you have over 100 locations.  We handle this entire process for you.  Else, it’s just $10 per month per location you have– and that includes the submission, verification process, as well as reporting back on how many listings made it through.  It’s also month-to-month, in case you aren’t happy with the measurable results we provide.

Somebody should call Albertsons and tell them about this.

Ever gone into AdWords and seen stuff you hadn’t seen before?  Google likes to keep releasing these features and not telling anyone about them– maybe to keep us on our toes or to use the general public for beta testing?  Anyway, a couple days ago, I blogged about sitelinks in AdWords– that you can specify up to 10 links underneath your regular paid ad if you happen to also in position 1.  I took a screenshot to show you:

What will likely happen is that advertisers in certain markets will now have a crazy incentive to bid to first position, which could cause a cascading effect on bid prices at any position.  Do you think Google anticipated that?  You betcha!  The reward being dangled out for first prize is so great than it will lure even ROI-focused advertisers into the fray.

I’m not going to get on a soapbox on Google being evil or about PPC prices continuing to rise.  But I will say that for smart search marketers, you have an increasing opportunity to DOMINATE Google search results.  Just imagine if you already have the #1 organic search result and then have the #1 paid result with 10 sitelinks?  Check out my earlier post to see what that looks like— and then consider how you might get there, too.

The opportunity to win in local is even stronger, since you will soon be able to pay monthly listing fees to be in Google local search results.  If you’re not aware, the Google 10 Pack has now shrunk to the “Lucky 7 Pack”, to allow 3 paid ads to be shown on top.  Any economics undergrad could tell you that if you have dollars, Google will find ways to reward you for spending them. The days of organic SEO in local are not over by any means– but put your capitalist hat on if you want to see the trend.

Bruce Clay and I had a conversation about this at PubCon and he remarked it ironic that Baidu was going in the opposite direction.  The dominant Chinese search engine was moving from a SERPS (search engine results pages) that was mostly ads to one that would be mostly organic results.  Baidu had not even marked what were ads versus not.  Funny that both giants would be going in opposite directions.

Meanwhile, if you’re building a business serving local clients, you better get with the program.  You can integrate your GLBC listings with your AdWords, Google Analytics– and now get Webmaster Central and Website Optimizer API access.  If you want to see what BlitzLocal can do for you in local directory submissions and geo-multiplied PPC templates, give me a holler.