Is ‘Local Search’ A Vertical Or A Verb?

Is local search a microcosm of general search or is it the ultimate vertical? I’ve had this debate with a number of people over the past couple of years. Ask’s CEO Jim Lanzone once told me that he felt local was part of almost every vertical, and therefore not a vertical. I agree with him that local isn’t really a vertical because it cuts across everything. But we tend to refer to anything slightly more specific or focused than general search as a “vertical” these days.

In my presentation for the “Local Search Marketing Tactics” panel at last week’s New York SES show, I tried to offer an expansive but I believe more accurate definition of local search from a consumer perspective. Local search, as a “verb.”

The current, generally used definition promoted by comScore and the Kelsey Group, which I helped formulate while I was there, is basically: search with geographic modifiers or use of a local search engine or an Internet yellow pages site (wireless to come). My alternative, but I now believe more accurate, definition is: a process by which users seek information online, where the ultimate intention is an offline transaction. In other words, the Internet influencing offline purchase behavior at local stores or from local service businesses.

Some might argue, with that definition, that local swallows the Internet itself. To that I say “exactly.” E-commerce is roughly 3% of total U.S. retail, but the Internet’s influence continues to grow over offline (local) purchasing. So while my definition is somewhat messy and casts a perhaps unwieldy and broad net over local search it’s much more accurate in terms of what’s going on in the physical world.

Now back to verticals.

Much of the local search action and innovation is happening away from the general search limelight in verticals. Categories such traditional classifieds (jobs, cars, real estate, private party) as well as dating and travel together represent millions of monthly unique users. Also, online newspaper sites have almost 60 million monthly unique users, not all of which are locally focused of course. There are also the categories of restaurants, home improvement, weddings, health and many others that are locally oriented or have strong local aspects.

Online communities and social networks such as MySpace have local aspects (classifieds, hosted promotional pages targeting specific markets, MySpace Jobs). Also, the growing category of “mom” and parenting sites have local search dimensions (see, e.g., ParentsConnect or Lilaguide).

General shopping and retail sites, in my expansive definition above, also see lots of local search activity. That’s because most of the people who use them are eventually going into stores in their area to actually buy products. (Circuit City’s buy online, pick up in store feature is the most explicit version of this.) And while a price comparison search on Shopping.com arguably can’t be called a “local search” per se, among the most popular features (top three) on branded retailer websites, according to the e-tailing group, is the store locator feature.

From a practical standpoint what this means is that local search marketers need to invest equally in “horizontal” sites like search engines and Internet yellow pages, but also in verticals in their market segments. Most marketers already fully understand this but verticals are where you can reach many of the most targeted local prospects and buyers online.

From a general conceptual standpoint, the local search discussion infrequently takes on verticals because there are so many of them and for that reason they tend to make the conversation more complex. But, as I’ve tried pointed out, verticals are where millions of local users wind up looking for products, services and advice.

In thinking about local search we need to think about it as a set of online destinations that goes beyond Google Maps, Yahoo Local, Microsoft Live Local and Citysearch, etc., to include selected verticals. The larger point, however, is we need to simultaneously think about local search “as a verb” –- an activity or intention that cuts broadly across most online categories and is ultimately about the relationship of the Internet to the real world.