In case you hadn’t noticed Google is focusing more and more of its energy and resources on local. Let me count the ways: Marissa Mayer’s move to local, Google Place Search, Google Places upgrades, Google Maps for Mobile and Navigation, Google local product search, Google expandable map ads, Click2Call ads, Call Tracking, Google AdWords location extensions. The list goes on.
Then there are the failed acquisitions of Yelp and Groupon. The latter would have been the largest acquisition in Google’s history — by at least $2 billion.
The company is clearly putting its money where its mouth is. And yesterday the Wall Street Journal quoted Google SVP Susan Wojcicki saying that the local market is her biggest “focus”:
“That is my biggest focus,” said Ms. Wojcicki . . . “How can we enable you, when you’re walking around, to find out the best local offers around? As an advertiser, how can I find out if someone saw my ad and went to a store? The local market is a huge market, we’ve always wanted to be in it.”
The idea that “Local is Job One” may come as a surprise — even a shock — to some analysts and Google watchers. Local has always been this thing kind of “off to the side” for many marketers and most of the industry: messy, fragmented, hard to track.
Isn’t it mostly about “mom and pops” — you know, small time? If that has been the prevailing view it never will be again. Local is as much about brands and the Fortune 500 as it is about the neighborhood sushi place or the plumber.
Google’s new emphasis on local makes perfect sense when you clearly understand consumer behavior and how users research online before transacting offline: 95% of retail transactions are offline but 70% to 90% of online consumers research on the internet (depending on the category) before making purchase decisions and heading into stores.
Beyond that, the ad dollars traditionally focused on local markets approach 4X Google’s annual gross revenues. In other words, there’s a big market out there with lots of room for growth.
What makes local such a priority for Google now is not just the huge volume of ad dollars flowing through traditional media markets, but the rise of mobile and smartphones as a computing platform. The connection between mobile and location is much tighter and more transparent than the connection between the PC and local, which has historically been opaque to most people.
Consider that per Microsoft 53% of mobile searches have a local intent. Consider that mobile users doing commercial queries often have more immediate needs than PC users. When you put those things together with the typically improved performance of locally targeted ads or those with locally relevant content the logic behind Google’s interest in the segment is very clear. In fact it’s not a “segment,” it cuts across the entire range of consumer behaviors.
To some degree the word “local” itself has added to the confusion around the size and nature of the market. I find that when you substitute the word “offline” for “local” the light bulb goes off for many people.