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The Importance of Local Advertising in the Wake of COVID-19

Four months into COVID-19, and our collective psyche continues to grapple with this current-COVID era as we continue to look on the horizon for what may be coming next. Business owners are being impacted on a personal level but are also fearing for their livelihoods as businesses across the country have been forced to shutter. Legacy retail brands like J.Crew and Nieman Marcus, and franchisees like Pizza Hut have filed for bankruptcy, closed stores, and laid off staff in an effort to keep numbers in the black. 

However, there are businesses that are not just doing well, but thriving beyond their pre-COVID days. Whether their business was deemed (the coveted title of) essential, or they pivoted swiftly enough by adjusting their business model to capitalize on the current situation, there are businesses that are finding that advertising, specifically local advertising, is more beneficial and impactful to their business than ever before, and here’s why:

What was once considered insignificant information to tout in paid media is now “new” news, and warrants paid support

Basic information about a location’s updated store hours, or whether a business is operating at all is now “new” news and essential information. As many brands have modified their business model to accommodate this new world, with curb-side pick-up as a necessary amenity, advertising what was once a seemingly minute bullet point on a company’s website with paid media dollars is now imperative. 

Those of us in advertising know what comes next…constant reassurance (frequency) through paid advertising to influence that confidence level.

For a national advertiser, it may have once been easier, and more beneficial, to do a one-size fits all media approach and call it a day. In the current-COVID climate, local advertising is the saving grace. With every state across the country operating on a completely unique economic reopening plan by their own design, recovery rates across the country are vastly different. In many cases we are seeing that economic reopening plans are not commensurate with the care and stringencies required to slow the spread of the virus, impacting the categories of businesses in each region differently.  For businesses with multiple locations across the country, this drastic variance from region to region is beyond challenging, and something that a blanket national campaign can not address.  Aside from the lack of personalized regional messaging, a national buy does a disservice to the local entities therein.  Impressions will always tend to fall in the larger markets purely based on population size leaving the local markets underserved. “When you run a nationwide campaign what’s going to happen is the budget gravitates toward reach not necessarily conversion, and if you’re in the group of owners in secondary or tertiary markets, you get no coverage,” states Yoram Greener, Executive Director of Juba Plus, a data science and analytics group within Media Storm.  

The media needs to be able to serve all people – all locations/local agents proportionately, that will enable us to talk directly to the communities individually, and that is something a blanket national buy can’t do.

Local Advertising in Action

Greener, along with the Media Storm/Juba Plus teams, have been working to upgrade the level of sophistication and automation in local buying for years and to be able to address this, among a few other pain points of super granular advertising campaigns,  they have been proving successful for many of Media Storm’s clients.

Let’s be honest, local campaigns are tough to execute, especially for a national advertiser with a massive footprint. For a client like Big Lots! who is operating 1,400+ stores, that means 1,400+ separate bundles of zip codes, campaigns, DCM tags, creative, store-level participating promos, etc. This is a massive time commitment and yields significant room for error which is where the need for automated tools comes in to play.

In the current-COVID climate, it is imperative that Big Lots! is nimble in messaging, store-specific updates, and promotions to ensure they can maintain foot traffic levels necessary to keep them in business. While many companies like Big Lots!, Walmart, Target, etc. have an e-commerce presence as a thriving alternative,  most of these companies’ foot traffic is responsible for 90-95% of their revenue.  So, while bolstering e-commerce efforts has become a pivotal strategic direction given the pandemic, in-store visitation remains the primary source of revenue.   

This is not to say that local advertising is suddenly important – it was (and should have always been considered) an essential part of brands’ media strategies long before COVID-19 was part of the cultural vernacular. But with years of refining these strategies and building these tools, we’re actually now in a prime position to handle situations like a global pandemic from an advertising perspective.

Chad Urice, Executive Director of Analytics & Activation at Media Storm, has seen the evolution of what local advertising has become and how we are in the best position we’ve ever been to activate on that. “We now have the ability to impact the quickest path to growth ground up, with redefined geography based on behaviors through proprietary tools as a means of fluid activation on that,” said Urice. 

This is huge. For national retail clients with multiple brick and mortar locations, within any given market the customer base of one store compared to another can be drastically different. Being able to drill down to a granular level of personalization allows us to identify a better-defined consumer; it’s this type of “getting under the hood” of those local community nuances that is keeping brands afloat, and dare I say, profitable.

While brick and mortar is a natural beneficiary of this type of approach, this isn’t the only business model for which hyper-local advertising is working. Entertainment clients have long reaped the benefits of a local overlay to a national plan, not only because of impressions defaulting to larger markets, but also because cable operating systems which vary greatly across the country have been a proven driver of local ratings, ultimately impacting the national bottom line.

Fashion e-commerce brands are also seeing the benefit, even for brands that have a limited owned and operated brick and mortar footprint. By creating a roadmap to overall brand awareness, and systematically rolling out a localized approach in primed regions, we’re able to build impactful frequency that ultimately drives action. It’s the basic principle of concentration vs. dilution.       

Where do we go from here?

Right now, our clients need partners who can be dynamic and swift across all categories. Being focused on their ground-level efforts will ultimately put them on the path of an emerging marketplace, ultimately positioning them for success.

 The key things we should be asking ourselves when evaluating our plans right now is:

  • Does the media solve the business problems on a local level?
  • Do our plans allow for unique creative messaging tailored to this specific regions’ current needs?

While local advertising is, and has always been, an integral element in a brand’s overall marketing strategy, there is no doubt we will continue to see its importance grow especially as COVID-19 continues to blur the horizon for us all.  It’s clear that local advertising is more important than ever.

Want to learn more? We are hosting a webinar on August 5th to discuss the tools and ingredients needed to make a localized media plan a reality. Sign up here.