Survey: Enterprise Marketers Are Increasing Local Digital Mix

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Many multi-location brands still rely on traditional media for their local marketing, making them appear more conservative than local small businesses who have embraced digital marketing aggressively. But that’s changing, as enterprise local marketers become experienced with digital tactics they originally used to promote their corporate sites. Today, most of them spend less than a third of their digital budgets on local campaigns and programs, but 40% say they are increasing the local mix. 

To illustrate the dynamics of enterprise local marketing for both buyers and sellers of local marketing tech, services, and media, Street Fight conducted an online survey in June 2017 of 250 companies with more than 100 employees and multiple locations. The respondents were local advertising or marketing managers and decision-makers with knowledge and authority over campaigns and programs in support of local branches, stores, and resellers.

Compared with local small and medium-sized businesses (SMBs), the enterprise marketers use a broader variety of local marketing and advertising tactics, both digital and traditional. Street Fight’s SMB survey-based Local Merchants Report showed that nearly three out of four SMBs used social media, and nearly half used email, but only one in five used things like TV, print, digital display ads, or search engine optimization, and only about 10% used paid search. In contrast, half of enterprise local marketers use display advertising, and 40% or so use paid social media, a company page on a social network, email, direct mail, print, and TV. Twice as many big brands as SMBs use paid search. 

And while there may be more than a trace of traditional media inertia, it’s really a matter of those brands wanting to reach customers and prospects through multiple channels. Street Fight’s SMB survey confirms that local merchants with larger marketing budgets also spread the wealth across more channels. 

Most big brands spend more than 5% but less than than a third of their digital budgets locally. No doubt a lot of digital spending is devoted to driving traffic to their corporate or primary e-commerce sites. But that attitude appears to be changing, as illustrated below. A good 40% of them said they were increasing the local share of their digital spending, one in ten by 15% or more. 

Street Fight will publish a report on enterprise local marketing best practices and benchmarking shortly. One of the key findings of that report is that increasing the local mix of digital spending significantly correlates with success at a variety of marketing objectives. We observed that companies with over $1 billion in revenue are a little slower in increasing local digital spending, which may indicate less coordination among silos of responsibility, as well as inertia.  

Nonetheless, all of the enterprise local marketers we surveyed said they were maintaining or increasing spending on six digital tactics we asked about, as shown in the figure below. Fewer than 5% of respondents said they were cutting back on any of those digital channels. Overall, social media remains the favorite category tabbed for increased spending. The biggest companies are a little more likely to boost email spending, while the others are more aggressive on local site development and support.

These spending patterns are quite similar to those of the SMB local merchants. They too are keen on social media, email, and local sites. That’s because both small and enterprise local marketers rate social media and email as their most effective marketing tactics. A third of enterprises included email in their top 5 most effective tactics, and 31% said the same for paid social media ads. That’s a pretty big change. Street Fight’s enterprise survey of a year ago also had email on top, but ranked several non-digital channels (direct mail, TV, print, and radio) above social or other digital tactics.

In contrast, the small local merchants have zeroed in on social media and email, pretty much to the exclusion of other tactics. And when asked about interest in new technologies, both small and large local marketers called out location data and mobile push marketing as. Enterprises were more interested in addressable TV, while SMBs were keeping an eye on mobile wallets and payments.

BIA/Kelsey estimates that national brands will spend over $60 billion on local media this year, and that they’re increasing spending faster than small or regional marketers. Less than a third of that total is digital, but Kelsey’s figures are based on media revenues, so they don’t included digital marketing spending on local sites, SEO, or analytics. Suppliers of local digital marketing tech and services should be encouraged that both small and enterprise local marketers are increasing their digital spending, and on many of the same tactics. However, enterprise budgets involve more tactics, channels, and company departments, and have a crying need for integrated customer and prospect databases and cross-channel measurement. Street Fight will examine these and other enterprise local marketing issues in future reports and posts.

David Card is Street Fight’s director of research.

Click here for more on the The Local Merchant Report 2017.