Perspective - Why we’ll see more ad dollars flow towards LAM in 2025

The AdNews end of year Perspectives, looking back at 2024 and forward to next year.

Rachael Hockaday, Managing Director of retail marketing specialists Haeday

Effective marketing makes the most of every dollar spent. And when almost half of all Google searches every day have local intent behind them, that’s 1.5 billion daily, it represents a massive opportunity. 

Local area marketing (LAM) deserves more attention from marketers, not just for the size of the opportunity, but also its ROI and impact for marketing budgets. 

As savvy marketers look to continue to do more with less heading into 2025, we look at the case for a greater focus and budget directed towards local over the coming 12 months. 

Hyper-relevance 

Reaching customers where it matters. Local area marketing focuses on the local nuances which can make a difference. Messaging which feels tailored to you, matters more. Especially if you’re in the market for that product/service. 

29% of people search for local businesses once a week. There’s an audience already waiting to find your business. 

By understanding the interplay between advertising and consumer behavior, marketers can tailor their advertising strategies to effectively communicate with their target audience, aligning with consumers' needs, motivations, and decision-making processes.

The opportunity lies in contextual relevance. So getting it right is important. It’s worth noting that consumers are more receptive to contextual advertising over behavioral ads. What’s even more impressive is that ads with contextual relevance can deliver an uplift in sales (up to 16%).

We’re in the experience economy

The cost-of-living crisis has seen a lot of discussion geared towards price this year, with disposable income impacted by higher interest rates among other factors. 

Yet it’s important to remember that having a solid product, with a reasonable price is no longer enough to see brands through. The fragmented customer journey has resulted in more touchpoints, and an expansion for the role of ‘Place’ within the four ‘Ps’. There’s a raised level of importance now towards the overall experience of that journey. 

Research indicates that 80% of shoppers say that the experience a company provides is just as important as its products or service. Ensuring that this journey is as enjoyable, fiction-free is vital for many brands. And 90% of Aussies preferring to shop in bricks and mortar stores, the vital role of local area marketing can often be to direct customers to the in-store environment with a greater level of ‘experience’ control available. 

The heavy-lifting can be done in-store 

Speaking with many national multi-location businesses, the majority of their sales are still made in-store. Therefore LAM’s job is often simply to get more people through the door, where they can later convert. The call to action or ‘sell’ for your marketing can be a little less direct.

The opportunity is to then own the experience in-store. And this can start within 100m of your storefront. This could be everything from window displays, through to external banners, be they in a car park or shopping centre. Often it’s not considered. How visible are you? What will entice a shopper to cross the threshold? What is it you want to convey? 

Through informed customer service, brands are able to deliver a personalised experience, particularly with the growth of clienteling tools. 

Effective merchandising is another area where we’re seeing an uplift in sales for retailers which strategically create impact with Gondola end displays, and cross merchandising across categories.

Point of Sale Collateral (signage, posters, displays) is an important touchpoint in the shopper journey, with 92% of Australians admitting to making impulse purchases. Optimising how this could work best for your audience can make a big difference to your bottom line. 

Environmental design is another key element which can help your business make more of the in-store experience. Intentional layout which can keep customers highly engaged will help improve the experience along with time spent with your brand. 

The drive to in-store

The key to success in 2025 is going to be driving traffic into stores. Once there you can really connect with your customer in a memorable way. To help with this drive, we’ve seen local area marketing can be really successful at starting that connection. Localisation of messaging will be vital next year.

So as planning for the next financial year and beyond continues, consider making more of your budget by prioritising channels like LAM which can work harder for you.