Do you know how ‘local’ is your local Internet ad?
January 6th, 2009 by Leonid Kalika under Search AdvertisingIf you run a local business and serve mostly or exclusively local customers, whether in a single or multiple locations, read on…
It is easy to Geo-target your mailer or an ad placed in a newspaper, on TV and radio. You know exactly what area your mailing list or your local ‘off-line’ media covers. More importantly, you pay fixed price ‘per event’ – mailing, paper issue or radio spot. Life is, or rather was, simple…
Today you must have the ‘Internet presence’ to simply stay in business. Although Internet offers multiple venues for advertising, search engine marketing (SEM) in general, and specifically paid search advertising, will remain the most cost effective venue for some time, offering the best return on investment (ROI).
Let’s discuss paid search (or PPC – pay-per-click) advertising, which, unlike most other Internet venues, allows direct Geo-targeting of your ads. As the name implies, you pay for every ‘click’ whether the visitor is ‘local’ to your business or resides in another state. Thus, the effect of proper Geo-targeting could be thousands of saved advertising dollars, and substantially better quality of leads these ads generate…
Well, you have read all the guidelines offered by Google, Yahoo, MSN, etc. and selected the target area around your business location to display your ads.
You listed the named localities around your business in your Google campaigns so that city name shows up as a free ‘4th line’ in your ad. Or, you begrudgingly selected some radius around your business on Google (10 miles is the lowest practical resolution), or even larger and seemingly arbitrary area on Yahoo or MSN. You followed all the right procedures, but did you actually optimize your ‘Geo exposure’? Perhaps…
HOW DOES A SEARCH ENGINE KNOW WHERE THE ‘SEARCHER’ IS LOCATED?
Let’s digress for a second. An area code and the first 3-digits of your phone number used to generally determine your home or office physical location – actually, the location of the local ‘central office’ servicing your prefix. Yet today, your 10-digit phone number is simply a virtual number, which could be completely unrelated to your physical location.
Similarly, the physical location of the computer you use to access Internet and search could be generally determined by the Internet address (‘IP address’) of the ‘gateway’ of your local Internet access provider (which used to be located no more than a few miles from you). Yet today, you likely have only a single DSL and a single cable provider offering Internet access in your area. Technology has evolved and it is neither necessary nor economical for these large national service providers to have their equivalent of a local ‘central office’. They simply aggregate and ‘haul’ data traffic from many neighborhoods to a central data center that could be 50 miles away from your actual location. As a result, the Internet address of the ‘gateway’ servicing your computer does not necessarily define your physical location any more! Your ads may show up for searchers located 50+ miles from your business but will not be served to the people living right next to it.
Sorry for the long and boring explanation, but the IP address of the computer you use is the primary way for any search engine to determine which ads to initially serve you as a searcher.
There are several services that attempt to map your IP address to your physical location (e.g. MaxMind, IP2Location, Melissa, etc.), but the results you see are vastly different and the accuracy is highly dependent on the state and city you are in. Google and other search engines maintain their own Geo-location databases but still miss the mark in many cases. Here is an example of how two services classified the same set of searchers:
Example of Geo-Location by Two Services
So, be aware, geo test your ads, and try to mitigate location inaccuracies through smart advertising… I did not mean to add to your confusion with this post, but if I did, my apologies. You always have an option to retaliate and call us or drop us a note with your comments or specific questions.
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About Leonid
Prior to co-founding MetroGuild, Leonid Kalika was a co-founder of Strix Systems where he served, at various times, as COO, CTO and SVP of Product Delivery. His career includes senior management roles at several publicly traded technology companies and private technology startups including VP&GM of Mediation Business Unit at Vertel Corporation., co-founder and VP of Engineering at The Alchemy Group, Director of R&D at Retix Corp, and others. Leonid holds MSEE degree from Kiev Polytechnic University of Ukraine.
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