For the umpteenth time we hear that local ad spending online will ramp up

I have been covering the Web since aobut 1996, and so far as I can tell the local interactive ad market has been in a constant state of "preparing to explode." From the first days newspapers and classifieds sections made their online debut, analysts touted this massive amount of local ad money that mom and pop shops and plumbers and psychics were spending on Yellow Page and newspaper listing, local radio and TV spots. Once this multi-billion dollar largesse started pouring online — whoa Nellie, watch out. I cannot begin to count the number of schemes I covered for getting these small businesses online, building them Web sites and gettign their ad dollars into Yahoo Local and YellowPages.com, etc. etc.

Yesterday eMarketer issued its new report on local online ad spending, and it predicted that now, finally, really, no kidding this time, we will see the money start to flow. The $2.9 billion spent this year will grow to $7.8 billion in 2011 says ace analyst Dave Hallerman. Yes, it is tough to get a plumber to advertise online, even though by some estimates over 25% of search traffic is for local services. Local ad spending represents one of the biggest disconnects between actual content usage and media buying. Content online often is local, but advertising isn’t.

In general the local mapping and directory services have been supported by national franchisess like the Office Depots and Best Buys who have local stores but national media buyers. Penetrating that small to medium local business market has been the Achilles Heel of online advertising. What is different now? According to Hallerman, who has forgotten more about digital advertising than I know, "a number of factors are set to accelerate growth in the market: the wealth of small and midsize companies potentially available as online advertisers, the increased use of local Internet sites and services by individuals and the development of local online ad networks connected with local media, such as newspapers."

Well, maybe. Ultimately, the major national advertisers only came online when the suits who bought media themselves came online. My experience covering the first Web bubble was that media and advertising only "got" the Web’s marketing power when the Web finally got to them. Only when the guys in the executive wing of major media and packaged goods manufacturers spent much of their own days connected to the Web did they start putting money here. My bet is the same will hold true for local business. When their own companies are more connected. When their communications with their client base and their partners finally becomes fully Web-centric, then these companies will start looking ot Google AdSense, to YellowPages.com, and to their newspaper ad rep.

Posted under Michael's Blog