Local Businesses: Definition and Other Considerations

As a marketing agency owner, you might consider looking into serving lead generation services to local businesses. However, if you’re not aware of what is a local business and what types of businesses can be profitable, this article hopes to shed some light on it.

What is a local business?

Simply put, a local business is an establishment that sells goods or services to a local audience usually within a close proximity from where the business is based. 

The definition of “close proximity” can vary based on various factors such as business type, location, operational model etc. 

For instance, restaurants and beauty salons are usually confined to a local town that attracts a population that is about a 5-10 minute driving distance. However, an accounting or legal firm may provide services to a more geographically dispersed audience, maybe spanning across a whole state or country.

The key point to note here is that a local business serves a “local population” and they need to be physically present.

With the rise in e-commerce and digital services however, the line is quite blurry for certain sectors (eg: retail stores). However, there are certain businesses that still need physical presence and fulfilled through in-person interaction (eg: dentistry, plumbing, hair salon etc.)

Categories of local businesses

There are many types of local businesses and can be broadly categorized based on two main factors:

  • Delivery: Physical or digital
  • Offer: Product or service

As such, they could be placed in a 4×4 matrix as illustrated below.

Different types of local businesses - matrix

These businesses can be placed anywhere across the spectrum. Through the evolution of digital media channels, more local businesses are now transforming their business model to offer their products and services digitally.

Though certain types of local businesses can do so, some others don’t have the same luxury for obvious reasons (eg: you need to physically be present at the salon to get the required service). On the other hand, legal services and consultations can be provided digitally (through video conferencing).

Nevertheless, the same local marketing strategies can be used at varying degrees depending on where they are placed on this matrix.

Promoting local businesses online

In this digital age, it’s become ever so important for local businesses to create a strong presence online. Though online shopping has surged in the recent past, over 90% of sales still occur in brick and mortar stores.

This indicates the importance of having a web presence to increase foot traffic and also compete with larger companies in the sector. It’s reported by the SEO Tribunal that around 97% of people learn more about a local company online than anywhere else.

Such is the impact online marketing strategies can have on local businesses. The customer journey is such as they research online (through desktop or mobile) to gain more information, and make a decision to go ahead with a local business once they personally interact with them.

As such, a well devised local marketing plan can not only increase online visibility but also drive more revenue to the business.

There are many local marketing services that you can offer to businesses. These can range from website development,  SEO marketing , PPC marketing, to social media management. All of these service offerings should align to helping the business attract more phone calls and booking enquiries.

Offering lead generation services to local businesses

If you’re planning to offer lead generation services to local businesses, you need to understand that these businesses primarily rely on connecting with customers within a specific geographical area that are shared with other small to medium-sized entities. 

Therefore, it’s important that you choose to work with local businesses that require help connecting with local customers to maximize their return on marketing spend. There are a few things to consider when choosing a niche to work with, but it’s important that you stay focused and flexible to truly understanding the businesses’ requirements.

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