10 Local Trends That Greet The New Year

Year-end reviews are always kind of arbitrary. For sure, a lot of overlap occurs from year-to-year. So much of what we consider “the ‘60s,” for instance, really happened in the early ‘70s. But clearly, r/evolution is happening in local, the Internet’s last frontier. Here are ten things we all saw in 2006.

1. Google and Yahoo have most certainly broken out a lead in local search, with a 70 percent combined share. All the others belong in a subset. But the subset, of course, can be lucrative too.

2. Local search isn’t everything, by a long shot. The key question: how fast will Google and Yahoo migrate beyond local search, impacting classifieds, brand/display and Yellow Pages. It ought to take awhile.

3. Mapping mashups have made giant strides, and have begun to shift the local paradigm. But maps are still just a feature. In local, lists (and position) remain king.

4. The conventional wisdom is that verticals and microsites provide better targeted solutions. But what we saw in 2006 was confounding: they’re actually reinforcing the Google/Yahoo juggernaut by utilizing their ad networks. Truly, sites that protect local positions should get some traction.

5. More local startups failed in 2006 because of their inability to successfully launch local sales channels. Is that good news for Yellow Pages and sales force driven segments? Not necessarily. Up to now, Yellow Pages and others have been too rigid. Unless they grasp the opportunities for partnerships and new sales products, Google-style, self-serve solutions will creep up on the industry faster than expected (but not so much in 2007).

6. SEO and SEM have emerged as a vital part of local advertising. Subsequently, local ad channels are scamming their customers if they aren’t providing local advertisers with SEO and SEM options. Many still don’t. I bet this will completely change by the end of the year.

7. Newspapers have gone through the “We’re the Kings” phase, and are now in the “We’re Good Partners” phase, culminating in the year-end deals with Monster and Yahoo for recruitment. Both are banking on the newspapers’ “thousands” of feet on the street to sell deeper into communities. But newspapers’ local sales channels are even more rigid than Yellow Pages. Ultimately, the sales channels may prove to be the least valuable part of the deals.

8. National advertisers like Dunkin Donuts, Baskin-Robbins, Wachovia Bank, Miller Lite and United Airlines have begun localizing their efforts via Yahoo Local, CitySearch and other conduits. We’ll see a lot of localizing in 2007.

9. Local social networks, and ratings/review sites have largely failed to disrupt local advertising, local commerce and local discourse. Only Craig’s List has – and so far, Craig is an aberration. What surprises me is that the Yellow Pages companies haven’t bothered to buy some of the likely suspects. Yet.

10. Directory assistance is the local ad segment that is going to be most transformed in 2007. Free providers, such as Jingle Nets and AT&T, are banking that free ad supported services and mobile demand will at least triple the volume, and boost revenues via highly targeted advertising. Ad inventory is the question mark here (along with operator automation technology). But it can happen.