Everyone’s now vying for a chunk of the ad budgets of this legion of entrepreneurs — everyone from your local newspaper and yellow pages publisher to Web giants Microsoft, Yahoo and Google. Yet the opportunity is vast and, despite endless odes to the promise of local search, the market remains largely untapped.

In a 2005 report, the Kelsey Group indicated that 55 percent of Internet users turned to search engines to find information about local firms, but noted that this activity accounted for just $175 million in local spending. Kelsey estimated that figure to be $3.4 billion by 2009 — while pointedly observing that because some 70 percent of small businesses don’t have websites, they aren’t in a position to do paid online advertising.

But here’s the brutal truth: most of today’s local search directories currently in the field aren’t in a position to help anyone’s faucet get fixed. Even with the requisite trappings of Web 2.0 — user rankings and comments and integrated search results — they are only the first step in the evolution of a truly useful local search product. And because those local search directories aren’t yet genuinely useful, they’ve stymied the Web’s penetration of small business. Put another way, if local search really delivered, small business websites would be as ubiquitous as, well, yellow pages ads.

Today’s directories are fine t if you want a list of restaurants on Main Street.

And while you sometimes want to know a list of what’s in the general vicinity — say, when you want to get your coffee from someone other than Starbuck’s or your burger from somebody without arches — (for instance, when we’re looking for a coffee shop or hamburger), there are at least as many times that you need a service and you need it now. A mechanic. An auto body specialist. A tow truck. A hair cut. A taxi. A lock smith, a window repairer, an air conditioning technician.

And while the industry marvels at user generated content, a circular problem emerges: good reviews attract customers; customers fill the vendor’s schedule; suddenly that vender is no longer available on demand.

That’s less of a problem for big, national companies with large payrolls than it is for the small, local business. For that organization, a full calendar means it can’t meet immediate needs — but isn’t that the essence of local search? Being there, on demand, as a local business?

In this scenario, the ostensible beneficiaries of the system — the small, independent local service provider and the long-suffering consumer — get the short end of the stick.

The Internet directory itself initially benefits from consumer interest — there’s a listing, a click, and therefore a payment. But a local business that receives calls it cannot service will “churn” in and out of local search, making it expensive for directories to manage and maintain the business.

The national business, which is able to scale quickly and add staff to meet the need, fares somewhat better. Small, local companies are rarely so fortunate; precious few hopefully are able to schedule business as to best suit their needs. The consumer is left to take what he or she can get, or spend an inordinate amount of time finding someone now.

The time has come for technology to work for the consumer, the local business and the Internet directory. Concurrently.

The next-generation of local search applications know that “NOW” is the formula for successful local search: Need (of consumer) + Opportunity (for vendor) = Winning (for all.).

This model certainly applies to the automotive vertical, as dealers move to update their online listings more frequently. Similarly, in real estate, the MLS — or the multiple listing services — provides a listing date and a sale date for homes on the market. (Note that apartment rentals have yet to make this leap.)

But the next logical step is to embrace and serve that group for whom local search can have the greatest payoff: professional services and service providers. Doctors, dentists, lawyers, accountants, and so many others who can and will meet the NOW need — and Internet directories that work to give users the best experience possible.

Call it a consumer revolution. Or call it services on demand. But whatever you call it, it is about NOW time — and what it takes to make the buzz about local search become a real conversation about dollars and cents.

Consider this familiar scenario: you need a plumber (or any service-oriented business). You search online for Los Angeles + plumber. More than 8,000,000 listings appear. You add the words residential + licensed + emergency. Still, there are more than 226,000 websites listed. Try local search and you’ll find 5,600+ plumbers in Los Angeles. From here, you start dialing, and probably make several calls before finding someone to fix your leaky pipe.

Local Search is a Poor State of Affairs for the Consumer

Consumers who need a local product or service benefit when they can easily connect with a merchant who can satisfy that need. But most of local search does not make it easy. Consumers have to sort through thousands of listings based simply on name, address and phone number — there’s very little empirical data to drive relevance.

Search engines determine how to identify websites which fit each individual search or inquiry based on complicated algorithms. In local search, proximity is currently the most common metric, because technology can easily map location and little other data is available.

If the searcher uses a city name in the query, business listings are typically ranked according to proximity to the center of the main zip code of that particular city. If a consumer uses an address in the search query, results are returned based on proximity to that particular location. These results certainly make sense for walk-in traffic — if I’m attending a conference in a city I don’t know and I desperately need coffee before my early morning seminar, then sure, show me the coffee shops within walking distance.

But proximity means very little in the case of the plumber mentioned above. It doesn’t matter if the plumber is down the street or 25 miles away, as long as he can be in my basement within the hour.

Local search becomes even more complicated in other merchant categories, particularly professional services. If I need a lawyer, and I live on a farm outside the city, I may still decide I’d rather drive downtown, where law offices tend to locate. Conversely, if I am downtown and need farming supplies (hey, it could happen) I may not need results closest to the city.

The problem is that local search results are a subset of all data provided by third parties who primarily aggregate white pages listings. For listings of lawyers, all lawyers are included: large firms, small firms, single person firms, some out of business — all they need is a phone number. So someone who needs an attorney who specializes in import/export law might have to make a lot of phone calls to law firms that don’t even handle those kinds of cases.

Your goal is to maximize those calls and turn them into sales and revenue. Knowing and understanding phone protocol — and preparing your staff — can mean the difference between ringing phones that lead to sales and those that don’t.

Preparation is Everything

Here’s how to maximize the profit from telephone leads: the key to success is in the details — even down to how many rings you’ll accept before a call is answered.

Prepare a cheat sheet for your telephone personnel that includes a script (one for the conversation itself, and another for leaving voice mail messages), synopsis of the campaign, questions they can expect, the answers, and how to follow through when an issue arises that they can’t solve. Each telephone sales representatives should have a book at his or her desk with order forms, pricing, talking points, etc.

Since this will often be your first — and possibly only — chance to connect with a new customer, take every opportunity to show you care about your customers:

• Make sure you ask for names and take care to pronounce them correctly. Ask how to spell a name if you are unsure.
• You want to follow through on all your promises – so be sure to get the contact info: email, fax, address. Ask clients how they prefer to be contacted. Some prefer a phone call back, others prefer email.

• Create a template of the critical information you want your team to collect and use that to take notes. If you have a customer relationship management (CRM) application, customize the fields to make this easier for your sales team.

• Remember the three Ts of sales: training, training, training. If members of your sales team are knowledgeable, they will be confident and will build credibility with your prospects. Always say “thank you.” Be grateful for each sale rather expecting it.

• Finally, listen. You are selling trust as well as your product. The best salespeople know that selling comes down to relationship-building and doing it very quickly.

Now, take this same principle — one that you’ve no doubt mastered — and apply it in the other direction: to your advertising buy.

What am I talking about? Here’s the thing: local advertisers often find themselves stuck in between the new and the old. Online local search brings lots of clicks and pay-for-performance economics, but doesn’t offer an understanding of each local market. Traditional media — primarily newspapers and Yellow Pages — are well-entrenched in their communities, but have yet to truly embrace the performance-based model that merchants can get online.

It’s not a zero sum game — there’s value in both the new and the old. Consumers are online, we all know that. But they also haven’t abandoned the traditional. To make both online and traditional advertising work effectively, local merchants need to apply their negotiation skills to the buy as much as they would to the sell. When scouting advertising, both online and offline, don’t be afraid to ask each to bend a little to give you what you really need.

Online — Ask for Calls.
The merchants’ ambivalence about local online advertising is evident in the numbers: Borrell Associates reported in April that local online ad spending surged to $4.8 billion last year — a 78 percent increase over 2004. Sounds like a big jump. But another report, released June 28 by eMarketer, says that only 7.9 percent of the total advertising so far this year has been spent on online local ads. The eMarketer report goes further to assert that among local advertisers, online is almost an afterthought.

The fact is, local search still falls short when it comes to playing matchmaker between merchants and customers. The early promise of the Internet was the click. It’s immediate. It’s active. It takes a consumer from an ad to the company in mere seconds. Businesses that are strictly e-commerce could scarcely ask for a more direct response, and they eagerly gobble up the clicks — hence the dramatic increase in overall spending.

But local businesses are not strictly e-commerce. Plumbers, lawyers, movers, locksmiths and auto repair shops don’t care about clicks. For these businesses the challenge with online advertising becomes converting a click into further action — continuing deeper into the company website or picking up the phone and placing a call. That’s two actions required before the sales cycle can begin. What advertisers need are calls, and the pay-per-call industry is growing rapidly to meet this demand. Ask for calls. You’ll get them.