My Thoughts on Google Local Listing Ads

MIHMORANDUM NO. 543 | October 9th, 2009Reader Comments (18)

As I mentioned in yesterday’s SMX East recap, Google announced a new ad format–Local Listing Ads–on Monday afternoon.  Both Greg Sterling and Mike Blumenthal have written fairly in-depth summaries of what the ads entail but I’ll try to lay out the highlights below:

  • Only businesses with claimed LBC listings are eligible to participate.
  • The landing page MUST be the business’s LBC URL or its Place Page.
  • The ads are tied to ONE category selected as part of the claiming process.  No keyword research on the part of the SMB is required.
  • Up to four LLA’s will appear either above or beside the real estate reserved for Local results in Universal (more on this below).  These will be rotated, though Google would not get into specifics on the interaction between pricing and demand/saturation in a given market.
  • Some form of support (likely email) WILL be available to SMB’s who purchase these ads.
  • The product is currently in Beta in San Francisco and San Diego ONLY.  At the moment, this is only an experiment Google has no definitive plans or timetable on if or when this might roll out elsewhere.

(Some of these questions Mike and I posed directly to a Google representative; answers are here. Google’s official pages on this product are here.)

Impact on the Local Search Space

Local Listing Ads are in large part analogous to Yahoo’s Enhanced and Featured Listing products.  They’re both easy to sign up for and feature easy-to-understand benefits and pricing.  The differentiator is that Google’s ads are going to be shown as part of Universal, and to my knowledge, none of Yahoo’s premium Local products integrate into a sponsored listing above Yahoo’s 3-packs (yet, at least).

Even though this product is in Beta in only two markets, Google is certainly thinking about the impact these ads will have on their SERP interface, making a dramatic change from the 10-pack yesterday to the Lucky Pack (7 listings) for a wide array of keywords.  This change not only makes click-through more likely from the new Lucky Pack, but allows for a little more space above. 

I wouldn’t be surprised to see traditional Adwords advertisers shuffled mostly to the right-hand side of the page to make room for LLA’s at the top, as in searches like this one.  Even in searches like this one where traditional Adwords advertisers remain on top, the blue pushpin icons are sure to have a significant positive impact on clickthrough for the businesses advertising with LLA’s, taking traffic away from traditional Adwords.

Already dealt a body blow by the 10-pack, Internet Yellow Pages who tried to cope with the loss of traffic by buying more Adwords are now going to find it even more difficult to compete.  If the Yellow Pages companies want to stay in business, they simply have to acknowledge that the real value that sales reps can provide is as web marketing advisors, rather than salespeople for a proprietary product.  The sooner they start helping SMB’s leverage ALL of the ad products out there, including this one, the faster they’ll recover revenue streams.  I readily admit that some of the distribution deals that the IYPs have made recently, particularly Yellowpages.com with Bing, could work out great, though, and I’d love to see more of those kinds of partnerships happen.

They will still be sledding uphill, though.  I’ve long thought that this kind of product could be wildly successful–the Adwords Starter Edition was a noble effort but even that was too complicated.  But in general, I’ll repeat a quote from that previous post:

Web advertising is a commodity and shouldn’t require any relationships beyond a good customer service department to answer questions with sign-up.”

To that end, Google simply must get into customer service or else it’s going to end up with a lot of unhappy SMB’s and a big PR black eye.  I’m not sure that Google has properly thought through the intricacies of this product yet–particularly how they’re going to satsify demand in markets with hundreds or even tens of advertisers; get ready for a ton of emails from SMB owners wondering “Why isn’t my ad showing up”–but that’s why they’re in Beta. 

If these Beta tests are successful, though, I see this as a long-term play to encourage SMB’s to dip their toe into web advertising, which should open up a HUGE new long-tail revenue stream for Mountain View.  Overall, this is the most exciting innovation in the Local Search space I’ve seen this year.

18 Responses to “My Thoughts on Google Local Listing Ads”

  1. Michael D says at

    I was talking to one YP rep recently and they suggested their company may aggressively shift focus to mobile and mobile apps, rather than drive traffic from the desktop.

    Personally, I like these changes and shake ups, it wakes everyone up (or more realistically motivates those already paying attention) to the fact that results are not static, map points move, listings change, sites appear and disappear. Companies with well thought out local seo strategies will continue to prosper.

  2. Eric Fredine says at

    Well articulated David.

    @Michael D The YP’s won’t find any refuge from Google in mobile – Google beat them there a long time ago.

  3. Dave O says at

    David:

    I have businesses. I’m not an SEO with clients. I’d go for it right off.

    1. I want to be amongst the first 4.
    2. Marketing through google and the search engines is so dramatically different from pre web days. A) you set up a web site B) You optimize it. C) you may purchase ppc D) You reoptimize it for Maps. E) If you are paying attention you optimize it for the long tail with broad keyword usage of two types: geographical and long tail on the product/services end.

    If you have been successful or continue to work on it…it is so incredibly better and cheaper than pre web advertising/marketing options.

    Customers are coming to you with intent. They are searching with a purpose and you work to meet that purpose through optimization on the correct phrases. Ultimately that is the same as the old print YP which, if it wasn’t a leading lead provider, it was invariably a producer of high conversion ratios. It was the source that potential buyers with intent used.

    If most things are in place….subsequent costs with the web are easily controlled and far lower than the alternatives.

    Currently, Google has a monopoly on potential visitors with intent. It dominates that market.

    Does Google need customer service? David: From your lips to G-d’s ears. They desperately need it. Lets hope they get it going, smooth it out…and then ultimately move it into the LBC, google groups, and hand adjusting what have to be thousands of unhappy smb’s that ask for help in google groups, only to never get an answer.

    Meanwhile these thousands of unhappy SMB’s are sitting in an environment that is the dominant source for shoppers with intent, the best kind ….yet the SMB’s visibility is being all screwed up. The unhappy, unfulfilled SMB’s are unfortunately now in marketing limbo.

    In any case if and when the LLC comes to my markets I expect to be first in line.

  4. Ray Grubman says at

    Yeah, it’s a great opportunity for SMBs to get some exposure at the top of the page, and it’s another way for Google to maximize revenue, but I wonder about the longer-term effect this might have on Google’s reputation (and market share). I looked at the page you cited above with the San Francisco dentists, and my initial impression was, “Geez, this looks like some crappy site with a thousand Adsense ads all over the place.” The organic SERPs are completely invisible below the fold.

    Given Google’s aim of being the “trusted” provider of “the most relevant” search results, this whole thing seems at odds with that. They’ve said that their search quality is what allows Adwords to be so successful (i.e., form follows function) — provide the best search results, gain 70% market share, and some of those searchers will convert by clicking on ads.

    It’ll be interesting to watch whether searchers begin to view Google as pimping out most of the first page with paid ads vs. organic results, and whether the market react negatively.

  5. Mike Ramsey says at

    I am excited to follow this….I wish that someone who had access to ads tab could give some input. Do you know of anyone?

    Also, I think you might have coined a new phraze…in this post…”The Lucky Pack” I like it and it is very true.

  6. m2 says at

    “This change not only makes click-through more likely from the new Lucky Pack, but allows for a little more space above. ”

    Are you sure about that, DM? From the screenshots I’ve seen, the 7-pack takes up the same amount of real estate as the 10-pack. The fonts are larger on the 7-pack.

  7. David Mihm says at

    Matt, I think you’re right that the Lucky Pack takes up the same amount of vertical space currently…I wouldn’t be surprised to see them refine it a little, though. The map component looks awfully tall and skinny to me.

  8. David Rubin says at

    As the marketing person behind my wife’s largely internet driven interior design business, I’m interested in the new Local Listing Ads, but with some reservations. I’m not an SEO pro and would welcome another shot at some Google SERP real estate. However, like many higher value service businesses, the area where my wife’s business operates is pretty wide and not concentrated in the town where the business is located. She already lists number one for several of her services in organic and Adwords results for her business location, but that isn’t as important as one would think. Our marketing efforts are somewhat hamstrung by the “LBC address” and “distance to centriod” aspects of the Google algorithm. The entire local search algorithm is heavily biased to brick and mortar SMBs. If this is just another way to improve on an already visible listing in a geographic area that only accounts for a small percentage of business, then service related business should approach it with some skepticism. I wonder if Google will ever address these issues?

  9. Reseller says at

    This may really make life tough for the thousands of resellers of the Adwords product. All of whom make Google Millions of dollars without having to field a customer service or local sales staff. I don’t like it. They would have been better off selling the top 10 map listings results and tieing a tracking number to the listing. With Video, Pictures, Maps, and Sponsored links, content is getting pushed further and further down the page. Then again, if you are looking for a plumber in your city, the maps and sponsored links make more sense to the user than SEO listings anyway. The tracking number will show how valuable the space is, the maps listings are free and SMBs that are there should send Google a monthly thank you card. Predators like Yodle have been trying to cash in on the free listings for a few years now. It needs to be cleaned up or sold exclusively by Google.

  10. KennstDuEinen says at

    Very interesting article & thanks for your opinion on this topic.
    We transcribed some passages into german in our local search blog and cited you as THE main source for local search topics.
    It will indeed be very interesting how local business will adopt googles new business modell… The market in Europe is also very much diversificated, and we’ll see how Google will try to get into these different markets… a direct sales force, as Greg Sterling at searchengineland.com said, could be a good solution!

    Blog-Arcticle:
    http://blog.kennstdueinen.de/2009/10/erste-reaktionen-auf-googles-local-listing-ads/

    Greetings,
    Sebastian

  11. Tom Hale says at

    “To that end, Google simply must get into customer service…….”

    That is scary. If the current AdWords support environment is any indication.

    -T

  12. Vivek Mahadik says at

    This Debate is more interesting…

    It very painful for seo/sem firm but… it make more effective to local searcher/small business owner to get more valuable place in google search….

  13. Mike Stewart says at

    As I posted here: http://dallasgoogleguru.wordpress.com/2009/10/29/google-voice-google-local-listing-ads-the-perfect-local-advertising-combination-for-dallas-small-businesses/

    I believe that Google Voice will be a great source of call tracking in the future if they allow you to purchase additional phone numbers. I am hoping that they incorporate this in the Local Listing Ads they are testing in a San Diego and San Fransisco.

    I also think it would be great if Google offered some sort of phone number search in the near future as well as a “listed number title option” that can be indexed in Google Local Listings and Ads. This would be a very powerful strategy to dominate the local search market and keep up with Search at the same time.

    What are the costs for the lines, and since Google is attempting to get approval by the FCC do you feel like with the latest jab back from Google to the FCC will impact Google’s ability to offer the service to all brands such as AT&T and Apple?:

    “We still believe the Commission needs to repair our nation’s broken carrier compensation system. The current system simply does not serve consumers well.”

    Nice to see Google is aware that the telephone companies are too busy investing in FIOS in markets that can afford it vs making sure all the lines in America are upgraded. Maybe Google ought to take a look at what makes the Telephone Companies like Verizon and AT&T money…… FIOS and Wireless! Google Voice makes in impact on the financials of Wireless Companies in the longterm.

    Thank you for your genius David!

    Cheers,
    Mike Stewart
    <—— New blogger, but 10 years in the Local Search Marketing industry! I have always enjoyed your insights as one of the top 5 experts in local search!

  14. Dan says at

    I own a San Diego based gift basket company called Pleasant Surprises (www.pleasantsurprises.com). I can’t tell you how excited we are for LLA. How lucky is it that Google is testing this in San Diego and for Gift Baskets! They are only allowing select categories during the beta. Gift Shop is not allowed at this time. but Gift Basket is…go figure Do a search for San Diego Gift Baskets and you can see our two local ads.

    For us at least, this is a gift from heaven. At only $40 per month, it is only a fraction of our AdWords budget and with a much bigger bang. Each ad is given a unique phone number that fowards to our real phone number when called. Excellent tracking as a result.

    Again, I want to pinch myself. I can’t believe Google gave us this tool. Thank You!

  15. Linda Mirano says at

    How can I get removed from that service?

  16. Jason Hyman says at

    this is a great post. (as always)
    I just touched on the impact that all these changes from Google is haivng today! between local listing ads, local business listings going from 10 to 7 to 5, etc., http://www.localsearchpilot.com/local-search/how-can-a-small-business-keep-up-with-googles-changes

  17. Shubham says at

    Just so perfect…! Local Listing Ads will soon be very well……!

  18. g13 media says at

    Google local listings will be the future for geo targeted searches.

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