Tackling the Problem of Measurement in Local
In this new Street Fight feature, local marketing gurus David Mihm and Mike Blumenthal will semi-regularly kick around some of the biggest ideas affecting the local search ecosystem and the broader industry. Send an email or leave a comment if you have specific topics that you’d like them to touch on in future columns!
David: Hey Mike, hope your last couple weeks were as good as mine–I went to Crater Lake for the first time and made my first-ever hole-in-one! (</brag>).
Mike: How cool is that! (Crater Lake that is, not the hole-in-one 🙂 ). The hole-in-one is pretty cool too, I guess. How far was it?
David: Legit: 182 yards! But back our conversation…last time we said we were going to talk about the increasing fragmentation in Local, and if it was having an impact on small businesses yet. I know at our Local U events, your prototypical small business client Barbara Oliver sometimes makes a guest appearance. How’s she doing these days? As your canary-in-the-coal-mine, what’s she seeing?
Mike: As you know, she loves guest appearances and is always ready to chat. Her business is up 3x over the past four years. She’s ecstatic and and her “seat of the pants” assessment attributes that to Google and reviews!
David: Yeah, I think “seat of the pants” would easily rank #1 as preferred analytics package for small businesses. There was a survey that came out last week that confirmed this. SMBs can feel that local search works, but they’re too busy to look at dashboards, and/or it doesn’t meaningfully impact their business decisions to know specifically WHAT about it is working.
Mike: There is always the problem with measurement in local. SMBs do not have very good tracking and she is no exception. I have been looking at her numbers to get a sense of where traffic has been coming from, and what we can attribute to what. And while we are seeing Google continuing to send gobs of traffic, we are seeing the strong beginnings of that increased fragmentation we have been talking about.
David: So what do her numbers look like?
Mike: Most of what I see in quantifying local results are proxies…but one of those that offers some insights is Google Analytics. In her account, we are seeing some interesting year-over-year shifts.
In terms of search and social traffic, when I compare the last 12 months to the previous 12, I see:
- Absolute Google search traffic is down by about 8%
- Relatively speaking, Google search traffic is now only 80% of her total, down from 90%
- Bing/Yahoo traffic remains flat at 10%
- Both Facebook AND Yelp saw 150% increases y/y and are now contributing 5% of her total visits
Both Facebook and Yelp were starting at near zero but are growing rapidly. She doesn’t pay for any Yelp traffic but does boost her posts regularly at Facebook. Hmm, what does that say about ROI?
But she does a bang-up job on Facebook and has significant engagement there with real existing customers post-sale, so even if they sent ZERO traffic, the time investment would be worth it.
David: The most surprising thing in those numbers to me is that Facebook and Yelp were starting from such a low bar. Your point about the relative ROI of paid Facebook traffic vs. free Yelp traffic certainly speaks to Yelp’s potential for a paid product that provides real value, but their current ad product ain’t it, to say the least.
And I presume she’s not even active on Instagram or Snapchat or Pinterest, all three of which have plenty of value in building customer relationships.
Mike: Correct, she has NO social presence on Instagram or Snapchat and just a smidgen on Pinterest. Certainly she would benefit from a stronger presence on those.
David: My other inference is that if her business is up so substantially but Google referrals are down, at least some of those Google searchers must converting directly on-SERP without ever visiting her website…another trend you and I have highlighted/warned about for years.
Mike: We do see decent numbers on Google’s Insights product but it is so limited, unreliable and quirky (and it’s impossible to do comparisons), that we really can’t get meaningful numbers there. Google just upgraded their Insights product but it continues not to provide real information. Maybe someday it will.
That being said, calls and driving directions are strong sources and when combined with web traffic point to Google’s dominance for the next period of time….
David: For sure. You’d think that Google would put a little more energy into making the dollars-and-cents case to SMB’s with Insights. They’re so far behind Facebook and Yelp in this regard. Yelp’s estimated leads and sales figures are totally bogus but at least directionally they speak to what someone like Barbara cares about.
Google’s always had the disadvantage of being a more complex and opaque product than Facebook, but it feels like they’ve made almost zero progress on this front in the last eight years.
Mike: Man, we could talk for ages on the ages that Google has spent making, breaking and throwing away SMB products…so back to the topic.
A real black hole though is what Apple is sending that isn’t going through Google. About 50% of her traffic is now mobile and 75% of that is from Apple. Don’t Android users search the web?
But if I had to put a number on it, she’s is getting good local traffic from Apple. Starting in 2012 she started focusing on Yelp as a way to improve her Apple standing and that seems to have paid off.
So where are we? Has it fragmented enough that most SMB’s can reduce their reliance on Google? Or because of Google’s complexity, many of them currently DON’T focus on Google and just take what they get?
David: Well, I don’t know that I’ll ever advise an SMB to ignore Google completely. I mean Barbara is still getting 80% of her traffic from them. My prediction for 2020 has been that Google and Facebook-owned properties each send about 30-40%, and Apple and others make up the remaining 30-40%.
But the days where organic visibility in Google can increase business by 3x in four years are quickly slipping over the horizon.
Mike: 4 years…that’s three Google Local branding exercises from now. 🙂 I agree that the big 3 or 4 will dominate, and your numbers are as good of prediction as one can make that far out in this industry. Certainly the cost of achieving success in the Local Pack has gotten more expensive and the ROI on paid solutions will continue to improve in a relative sense.
I think that next time we need to explore the opportunities in the post-sale funnel which is where I see the best ROI for the foreseeable future.
David: Agreed! Looking forward to it.