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With the expansion of our digital worlds, it has become increasingly popular for small businesses with an e-commerce shop or online services to market themselves nationally.
The problem is, many of these companies are giving up their local marketing efforts in favor of a national approach as they consider it a superior option. They have been led to believe that focusing on the local level limits their potential base, while national marketing opens the door to a large number of potential consumers. While technically correct, the logic ignores the scale required to convert customers nationally and the conversion benefits of local marketing.
Local marketing is cheaper than national campaigns
It is well known that it takes a lot of manipulations to become a customer. We need to reach a potential buyer at least half a dozen times to get them to convert (or become a paying customer). This requires both financial resources and time.
In general, to do this using digital methods you need to use multiple media to attract and educate potential customers to choose you. Common strategies include social media, digital ads, SEO, PR, and email marketing to name a few. Expanding these marketing methods nationally is a huge undertaking that often does not produce the results business owners expect.
Related: A Beginners Guide to Building a Profitable Ecommerce Business
Converting digital traffic works differently
A business owner with a storefront in a major city recently described her decision to build an e-commerce platform on Shopify and promote it nationwide. She spent about ten months using this method on a monthly budget of $ 3,000 and found that her sales have not increased. Her in-store sales ranged from $ 32,000 to $ 43,000 per month, while her online store averaged just $ 3,000 to $ 7,000.
With $ 30,000 and hundreds of team hours devoted to building and managing the online store, she felt defeated. She wondered why she wasn't converting customers and generating significantly less than her local sales, even though traffic to her store was much lower than the site.
An audit of their website revealed a number of problems including poor photographic displays, product pages with little to no description, and no customer retargeting built into their website. This meant that not only did their store make a bad impression, but it also failed to establish long-term relationships with the people who had visited them in the past.
In contrast, her personal shop was on a busy neighborhood street, which meant that passers-by could unconsciously interact with her brand as part of their daily routine. Once in her system, she would send them coupons to return and hold special events on a regular basis to attract local customers. This is a completely different customer experience, which is why their physical store was many times more successful than their online endeavor.
Location is a differentiator
As well as being a cheaper marketing strategy, location is a differentiating factor that can help customers make decisions.
For example, someone looking for a freelance writer may get excited to find that their potential support person is in the same city. That means you have something in common and may reduce a barrier of trust by creating closeness.
In some industries, location can be a particularly relevant asset as your company may also be connected to other local resources to support a large project. For example, an event planner can technically work anywhere, but having a local focus means having a list of verified, high quality local providers and resources that can save time and ensure a high quality event experience.
Related: Lessons All Business Owners Can Learn From The Local Movement Of The Shop
Local orientation outside the market
In some cases, your local market may actually be too small or not have enough demand for your product or service. In that case, it would be a great way to expand without going fully national, creating a regional campaign, or selecting specific cities or states to target. This way, you can expand your market without breaking your budget.
To do this well, it takes solid market research to ensure that you are choosing the best possible markets that need your services and are not already saturated with providers.
Local growth can increase national results
Ultimately, starting locally and working your way out is a great way to maximize your advertising budget and lay a foundation for future national campaigns.
For example, a virtual accounting professional who ran a local SEO campaign to bolster their brand locally also found that their national rankings were growing at the same time. In a few months she will expand her budget nationwide while maintaining her local leadership over the long term.
Later on, when you go national, you have a smaller test market to experiment with and maximize conversions before moving into a wider market where the budget may have less headroom for test ideas.
Regardless of your industry, local marketing is an extremely valuable platform for growing your business and an essential part of a successful digital marketing campaign.
Related: 6 Benefits To You And Your Community Of Supporting Local Business Owners