How Much Is National-Local?

There are lots of numbers floating around about what proportion of “local” (or geotargeted) ad spending comes from national businesses (including franchises) vs. small businesses. I have some numbers internally but I’m looking for input on this question from those who have actual data or an otherwise informed sense of things.

Here “national” means brands or companies that have multi-state reach and recognition.

Traditional media (% of local ad dollars spent): do you believe the proportions are . . .

  • 90% national
  • 80% national
  • 70% national
  • 60% national

Online/Internet media (% of local ad dollars spent): do you believe the proportions are . . .

  • 90% national
  • 80% national
  • 70% national
  • 60% national

There are “hybrid” categories (e.g., local insurance agents or franchises that represent national brands). If you have theories or ideas about that segment, feel free to chime in. But otherwise we’ll treat the market as bifurcated: national and small business advertisers.

While the SMBs are more numerous the dollars at the national (targeting local) level are much greater. This is true in all media except perhaps yellow pages. My memory (I’ll have to go back and check) is that “national” advertising in print YP is about 15%.

Any feedback/input is appreciated.

4 Responses to “How Much Is National-Local?”

  1. Niki Scevak Says:

    Greg, one problem with your framework is that you seem to equate SMB with local which, with the Internet, is simply not true. You can do national vs local and you can do large vs SMB but you can’t do national vs SMB.

    Most of the small business on the Internet are national in nature (can ship anywhere in US or sell a completely digital product). They thrive because they can measure all the results of a transaction.

    A service based business that is inherently local in nature, has a harder time because it is harder to measure as most transactions are completed offline and even if they are completed on the phone then it’s tough to measure as there is a spillage point from Internet research to phone sale.

  2. Greg Sterling Says:

    Approximately 60 or so percent (perhaps more) of Google’s advertisers are SMBs as a technical matter. So your critique is correct. But in the US more than 90 of businesses are small businesses and something approaching or just exceeding 90 percent of those are service-based businesses (and thus local).

    My formulation in the question was crude I admit. But in fact most small businesses do buy and sell in local markets. But the question is directed toward people’s views of the local ad spend (and what % is SMBs vs. larger entities). Perhaps that wasn’t entirely clear.

  3. G5 Search Marketing » Blog Archive » Where Are You Reaching From? Says:

    […] “While the SMBs (Small to Medium-Sized Businesses) are more numerous the dollars at the national (targeting local) level are much greater. This is true in all media except perhaps yellow pages. My memory (I’ll have to go back and check) is that “national” advertising in print YP is about 15%,” Sterling said. […]

  4. Tim Tracey Says:

    Greg,

    The data you seek is also of interest to us. I can’t guess at the %s, though.

    “While the SMBs are more numerous the dollars at the national (targeting local) level are much greater. ”

    Envision a curve representing total ad dollars spent. The high end of the curve represents large, national advertisers. The long tail represents SMBs with small ad budgets – many doing business locally.

    We theorize that the area in long tail of this curve is significant – and may actually be greater than the area under the curve’s peak.

    These small advertisers may greatly benefit from evolving Web-based tools such as innovative social media applications that allow them to leverage the loyalty-fueled word-of-mouth of their satisfied customers.
    – – Tim

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