Report: More than half of local marketing efforts underperform

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Eighty-six percent of marketers intend to localize their marketing campaigns, according to a survey conducted by the Chief Marketing Officer (CMO) Council. Only 12% of respondents believe they have highly evolved local campaigns and analytics, and nearly 50% say their local campaigns have underperformed and need new strategic thinking.

“Everybody is saying local marketing is critical but they're not executing effectively against that,” said Donovan Neale-May, founder and executive director of the CMO Council, which surveyed more than 300 marketers online over a three-month period from June through September of this year. In addition to the online survey, the council also conducted interviews with senior marketers from 20 brands, including Coca-Cola, Macy's and Toyota.

Neale-May said marketers have been ineffective due to a lack of resources and an aversion to technology.

“Only 27% of respondents have embraced local marketing automation platforms,” he said. “Most marketers are technology averse. I don't think they realize what's available out there. They aren't reaching out to find what's available to improve localized channels.”

“Companies should use cloud-based software-as-a-service automation products to manage their digital assets locally,” Neale-May said. “Companies that are good at this have a competitive advantage here.”

Twenty-four percent of marketing respondents allocate more than 50% of their marketing and merchandising budgets to local programs, according to the survey's findings. Forty-two percent spend between 20% and 50% of their budgets on local marketing.

Neale-May said he was surprised to find that the most preferred channels for localized marketing are experiential events, direct mail, localized websites, social networks, electronic messaging and interactive digital signage.

“Traditional media is losing out,” he said. “TV, radio and even newspapers are losing their spend. There's obviously a shift going on in where dollars are going.”

Despite marketing budgets being allocated from traditional channels to local digital channels, online deal delivery networks, such as Groupon and LivingSocial, lagged behind all channels of localized marketing choice for national brands, according to the findings. 

“We haven't seen national marketers jump on the group-buying bandwagon,” said Neale-May. “Local merchants have exploited it but national marketers are still trying to figure out if it's a good thing to use or not.”

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