How Should SMBs Buy Local Search Advertising: Automated Services Vs. Sales Reps?

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Local search marketing is a crowded marketplace with many companies offering small and medium businesses (SMBs) the same or similar services. It is also increasingly difficult to separate search marketing from other marketing, as everything from website development to third-party content to social media chatter affect search results.

In all, small corporations spend $50 billion per year on marketing according to a 2006 analysis of IRS tax return data from Magna Global. If you add in national advertisers that are targeting local markets, the value of local media is estimated to be as high as $120 billion annually.

The chase for those marketing dollars is strong as reported by a 2013 Borrell Associates survey, which found SMBs field nearly 19 sales inquiries a month, on average, and actually speak to 6.5 different representatives a month, on average.

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Who should SMBs turn to in order to get the right help with search marketing? Should they do it themselves? How will technology change the type of help SMBs need to market themselves? Is there still a role for the estimated 80,000 local sales representatives in the United States and as many as 200,000 worldwide?

Automation And Self-Service Will Hold More Market Share…

The future of marketing is in automation — software that automates the tasks of placing ads and distributing marketing pieces. Programmatic ad buying is sweeping across the digital advertising industry with Yahoo reporting that 90% of digital advertising will be programmatic within a couple of years.

However, automation does not equal self-service. Even though email made it possible to send a communication to thousands with the push of a single button, most businesses still utilize a service to help with email marketing.

Nevertheless, self-service solutions will become increasingly popular in time. Former Hibu CEO, Gary Shaw, estimates that up to 10% of the SMB market is already using self-service in some form and that it will take approximately three to five years before it hits its critical mass.

Self-service platforms will need to be adapted to be smarter and simpler to accommodate a larger user base. But some products, like Google’s AdWords Express, already have a strong self-service following.

For those small businesses with a very limited advertising budget, self-service advertising options will only grow — and with enough elbow grease, these options may meet the basic needs of an advertiser.

…But Live Sales Rep Communications Aren’t Going Anywhere

Even though Google built its AdWords business on self-service, Google’s Ben Wood doesn’t see self-service dominating the future of local media sales per a report by analysts Greg Sterling and Neal Polachek called “Local Media Sales 2020: Platforms, Profits or People?” SMBs simply don’t have time to manage the process themselves.

This point is reinforced by the 2013 survey from Borrell Associates, which found that even though small businesses state that they prefer email solicitations to telephone sales, which are preferred to in-person visits, the responsiveness to each method is inverted. In-person contacts are more effective than telephone sales, which are more effective than email.

Sterling and Polachek put forth a powerful argument that SMBs need more help than ever before given the growing complexity of “local-digital marketing” that requires a “consultative sales” approach that focuses on solutions, audiences and the SMB’s needs.

SMBs need more help to manage the increasingly fragmented marketing industry, yet prefer to deal with fewer, not more vendors. According to a 2013 Thrive Analytics survey, 75% of SMBs would prefer to work with one company or individual for their marketing needs.

The SMB’s challenge is finding a trusted advisor that truly demonstrates an expertise in a diverse number of options and who understands its business enough to provide effective solutions. There are providers that are changing the traditional sales model to accommodate these needs through use of tools such as big data and verticalization.

Big Data And Verticalization Will Be Further Utilized

The consultative approach is expensive.  To make the process more efficient, sales representatives will need to utilize big data in order to better understand the needs of SMBs and their customers. Data and business intelligence provide the ability to develop and deliver the right marketing mix for the customer’s needs.

Verticalizing the sales force, or assigning reps to specific industries, is another tactic that will help sales reps meet the needs of SMB’s. Verticalization allows the reps to become more knowledgeable about their customers’ industries and needs, which will in turn provide great value to the customer.

In order to find the best help, SMBs should identify those sales reps that have made changes to the way they approach their customers to utilize new tools, methods, or data that better serve them.

In-Person Vs. Telephone Sales

More and more marketing companies are moving their sales force in-house, where sales are conducted by phone on the basis that outside sales forces are not sustainable.

Certainly, expertise in different marketing solutions or in specific industries can translate just as well over the phone as in person. Someone located geographically in an SMB’s area, however, can add local, community, or cultural knowledge to a marketing strategy. And an in-person contact allows a business owner to better consider all the personal intangibles of doing business such as credibility, trust, and a personal relationship.

For the SMB, an in-person consultation may be the more expensive route. But local sales reps may work with the SMB to control those costs by doing most of the work by phone with only the most important meetings in person. This is an option either the SMB or the sales rep can explore.

The Bottom Line In Order To Manage The Bottom Line?

People, or the human factor, will remain a constant in sales, although their role might change.

While self-service is increasingly viable, most SMBs do not have the time to manage their own marketing.

Local businesses respond particularly well to in-person, face-to-face contact where they can learn about media offerings and develop a trusting relationship before spending their local advertising dollars.

SMBs should seek those reps who demonstrate an expertise in multiple solutions and that understand their industry or business sufficiently to distinguish how different solutions would work for them.

Big data and verticalization will help the sales force become more efficient and better understand its customers, offer cost effective solutions to offset the consultation cost, and free up the customer to grow his or her business.

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