Your Local Online Advertising Options

Are you ready to market your local business on the Internet? Well then, the first thing you need to do is spend a lot of money creating a website... not! As a matter of fact, you don't even need a website to start. So put away that checkbook (for now) and let's instead take a look at your online advertising options...

Internet Yellow Pages. Yes, it's the online version of the tried and true yellow page directory. Simple enough to understand right? For example, check out YellowPages.com, SuperPages.com, and Yellowbook.com. Each of these offers a free listing for your business and you can also pay for a more prominent listing... again, just like the regular yellow pages.

Online Directories. These sites make it easy for Internet users to search for a local business like yours. Yahoo! Local, Local.com, and InsiderPages are local directories you should consider. There may also be directories that just focus on your type of business. For example, if you own a restaurant then you probably want to be listed in UrbanSpoon. Many directories offer free business listings... and if you're willing to pay, your business can show up higher in search results!

City Guides. These websites are more about "what's great" and "what to do" in your local area... and user reviews and popularity are important factors in determining which businesses get the most attention. Citysearch and Yelp are good examples. And like the Internet yellow pages and online directories, you can get a business listing and promote your business in search results.

Paid Search. Of course you can always pay Google, Yahoo!, and Microsoft to show up in their local search results. For example, if you're a dentist located in Chicago, it may make sense to buy a paid search ad for the keywords "dentists, Chicago" to drive local prospects to your website. Keep in mind that setting up, testing, and managing your paid search programs can be time consuming and complicated... so you may want to turn to firms like Yodle or ReachLocal to help out.

Online Newspapers. Don't forget your local newspaper! It attracts lots of online readers from your neighborhood. And just like the print version, you can buy ads in different sections like the news, sports, and entertainment pages of their site. But this may be a better option if you have your own website and a bit more of a marketing budget.

Local Websites. There are many other websites that cater specifically to your local market. For example, your city magazine probably has an online version. Plus there are local blogs that focus on community news, real estate, parenting, sports, and even nightlife. And some may be looking for advertisers just like you. The key is to find local websites that do a great job of reaching your target audience.

All good and helpful information right? But where do you start? Well... that depends.

What if you have no website or budget? At least get your free business listings with the Internet Yellow Pages, Online Directories, and City Guides. A business listing is like a one-page website showing your company name, address, phone number... and maybe more. That way the millions of people searching these sites can now find your business! And if you have some budget to spend then consider upgrading to a paid and more prominent listing (about $50 per month). You should also start testing some of the advertising programs these sites offer ($100 to $400 per month) to see what works best... to get the phones ringing!

What if you have a great website and $500 or more per month to spend marketing your business? Then, in addition to advertising in the Internet Yellow Pages, Online Directories, and City Guides, you should also be running local paid search ads. And if you're looking to spend over $1,500 monthly on advertising your local website (lucky you!)... definitely consider adding your online newspaper and local websites to the mix.

Btw... right now someone in your neighborhood is searching the Internet for a business like yours. Hurry up and get started... to make it easy for them to find you!

Do the Marketing Math for Your Online Business

Let's say the goal for your online business is to generate $1,000 in cash every month. Given this goal, how much should you invest to market your site? Or do you just spend what you can and hope for the best? Unfortunately, too many people I talk to are not doing the marketing math to realize that hoping is not enough.

Let's do some easy calculations to understand why.

First you need to answer a few questions:

• How much money do you make per order? Just multiply your profit margin by your average order size and this is how much you'll make per order. For example, if you expect to make a 50% profit on every order and your average order is $100 then you'll make $50 per order.
  

• What's your website conversion rate? Don't expect more than one out of every 100 visitors to place an order. An order could come from someone using your online shopping cart or seeing your phone number on the site and calling in their order. Either way, it means you have a "conversion rate" of 1% (1 order out of 100 visitors) which is pretty typical these days. And when you're first starting up, your website conversion rate could be a lot less than 1%.
  

• How much are you paying for each website visitor? Whether you advertise using paid search or banners, you want prospects to "click" your ad and come to your website. To keep things simple, let's assume you pay Google $2 for each of these clicks. This means your cost per website visitor is $2. (Generally speaking, you should expect to pay Google $2 to $4 per click)

Now we're ready to do the math:

1. Cash goal: $1,000 (my example)
2. Profits per order: $50 (per our assumptions)
3. Orders needed: 20 (20 orders * $50 profit = $1,000 cash goal)
4. Conversion rate: 1% (1 out of 100 visitors will order)
5. Number of visitors required: 2,000 (20 orders / 1% conversion rate)
6. Cost per visitor: $2 (cost per click)
7. Marketing spend needed: $4,000 (2,000 visitors * $2 per visitor)

Once you've figured out the math you'll come to an important conclusion: in my example, you have to spend $4,000 on marketing your website to generate $1,000 in cash. What's the bottom line? You'll actually lose $3,000 every month!

Or said another way, it's almost impossible to make money paying Google to drive traffic to your website. Does this mean that all is lost and you'll never make money with your online business? Of course not! There are a number of ways to more cost-effectively market your site than handing over every dollar to Google.

For example, search engine optimization can help you generate natural (free) search traffic to your website. You can also submit your site to online yellow pages and directories that make it easy for prospects to find your business. And when you make your first customers happy, they'll become a "volunteer sales force" and tell everyone to come check out your site!