Google vs. Facebook vs. Groupon-Who Offers the Best Value to Local Biz?

Fri, Jan 21, 2011

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I recently posted a response to this question on Quora and think you will enjoy it if you work with Local Businesses on their marketing strategies or are a local business owner.

I have edited and copied my answer below:

This is a tough one for sure because of how much they are working together. You have Groupon offering the most perceived value because they are immediately putting dollars in the local business owners pocket. Tom Williams makes a great point that those dollars also come with growth challenges for these merchants that they are not accustomed to handling.

While Groupon does bring them customers they would have never had as well as the much greater opportunity for a repeat customer, those customers will always be expecting a deal moving forward. Ive begun reading that devaluing your brand to offer these deals may hurt you in the long run but I think its too early to tell. Clients I have worked with on Groupon campaigns have felt it was great value but again were overwhelmed with it. It was free money for the business owner when customers never cashed in their groupon as well.

I agree a key to Groupon’s success is what happens on Facebook for those who miss the deal in their inbox.

I am not as savvy with running major campaigns on Facebook for small businesses just more for Author branding but hope to learn more. Clients I have worked with have experienced steady fan growth and use Facebook as a valuable tool.

Ive seen some local businesses gather tons of fans but never see a dime. They then struggle to manage their fan pages and feel they are wasting their time if they don’t have someone working on it for them.

From my experience they are not really as familiar with the functionality of Facebook Places yet but as mobile growth continues at a staggering rate it should be interesting to judge the value.

On Facebook they have their friends and family at their disposal but not sure how much buying is occurring from that.

As Facebook adds more functionality and simplifies things for small businesses their value grows exponentially because they have the strong social bond already in place and much more personal data about the interests of the consumer.

Google in my eyes is the winner today. They give a local business owner the most targeted customer-the one who has intent to search for an immediate solution to their problem. Consumers with an issue they want to fix are very motivated to purchase.

They also give a business owner the greatest ability to dominate their market versus other competitors.

Lets say there are 7 or 8 major keyword phrases with local modifiers for a local business niche and in aggregate 5000 searches per month.

In this case take a plumber and 3 potential phrases he might try to dominate for:

plumber charleston
plumber in charleston
emergency plumber charleston

(how google is localizing for the searcher from their IP address and generic keyword phrases like “hot water heater” or “plumber” is a whole nother story of value for the local business)

There are 12-15 spots available on the first page for each keyword with the recent algorithm change in local search.

There might be 200 plumbers in Charleston.

If a plumber has a good reputation online, updated business information, and 100% completes his Google Places page with the content they ask of him (pictures, videos, coupons, categories, etc) he has the opportunity to be on page one overnight if he is not in a major metropolitan city or highly competitive area. While the other 200 plumbers are unaware of Google Places his value from Google is through the roof for now. His Google Places ranking will continue to grow as he receives traffic.

Google makes him aware of the number of impressions his place is getting, people clicking through to his site, terms being searched, coupon functionality tags to promote, where people are requesting driving directions from and more.

In addition to his Google Places listing, if he does any of the following he has the chance to come up multiple times on page one next to his free Google Places listing and establish himself as the authority in his market:

-optimize his website with proper SEO according to google standards.
-distribute videos described and tagged properly on youtube that end up in Google Search and Video results
-write a “what to know before you hire a plumber in charleston” article that google displays prominently for him on long tail searches.
-runs a small adwords campaign

-…and so many other content marketing strategies he could employ to keep gaining value while separating himself from his competitors who are following simple google places tips.

You have Google pulling all the reviews from other sites into there feed as they try to add the social element with Hotpot (even last week coming out with a Google Places iphone app to help that accelerate even more)

And now they are coming up with their own Groupon:

http://searchengineland.com/google-readies-groupon-clone-report-61930

It will be interesting to see who ends up giving a local business owner the most value but all three are surely on the cutting edge and providing more value than the yellow pages they are used to paying for.

Which one do you think is most valuable? If you visit the post on Quora.com you will find the discussion is heating up…

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