While the social network isn’t doing away with its direct-sale initiative, it is focusing its attention on ads that drive consumers to retailers’ sites.
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With Boost, a business owner can go into her business listing, select a category, set a budget, create a profile and write a brief description of her business. Google automatically creates an ad and decides when it's appropriate to display it. Boost places the ads, so business owners don't have to worry about learning the intricacies of keyword bidding and they only pay when an ad is clicked. Merchants can track impressions, clicks, cost during a specific time period, and more.
Google also is testing adding little yellow markers called Tags to listings in some cities to draw more attention to them, for a flat rate of $25 per month. A Tag in a search result might say "Watch videos about our business" or "Save $175 on your first visit."
EBay also is getting into local, and offering merchants more than just a business listing. EBay paid $75 million in December to buy Milo.com whose technology lets consumers see what's in stock at bricks-and-mortar and online retailers. EBay has linked Milo to the RedLaser mobile shopping app it purchased earlier last year, so that a shopper can now scan the bar code of an item with her mobile phone and see which of some 140 retailers that work with Milo have the item in stock and at what price. EBay also has integrated Milo into eBay.com and has plans to add it to its core eBay shopping app in the next year.
For Black Diamond Sports, which sells hard-to-find skateboards and supplies from a shop in Palo Alto, Calif., Milo has proved a conduit to local shoppers.
"Before Milo, people didn't know about our store or the inventory in it," says Konstantin Shostakovich, the store's manager. "I was always shocked when I'd ship an online order literally five blocks away. Sometimes I would drop off an order on my way home from the store, it was that close. They didn't know we were right down the street." Now that he's on Milo, Shostakovich says skateboarders sometimes walk into his shop with a printout of his inventory from Milo and snatch up the most coveted items.
Do it yourself
And local merchant groups are recognizing they can do their own web marketing. In Chicago, a neighborhood merchant association, the Northalsted Business Alliance, publicizes member retailers' promotions and in-store events on the association web site and on a web-enabled outdoor kiosk in the center of the district. The service is part of a merchant's alliance membership.
Anthony Almaguer, owner of eyeglasses retailer I.D. Inc., boosted store traffic and sales 25% on a recent promotion of high-end Tom Ford eyeglasses by using those marketing services, which are included in the $175 annual dues he pays the association. The alliance also offers its own take on Groupon during the holidays, selling member retailers' gift cards through its web site; the gift cards are sold at a 20% discount, and the alliance reimburses merchants for the discounts.
Almaguer says the gift card offer has helped boost his sales by 50% in December. "It completely knocks my December out of the park," he says.
It wasn't long ago that local businesses feared being knocked out of business by the web. But, with Groupon showing the way, they are starting to see how Internet marketing can offer them a new lease on life.