Mobile to enable ’08 explosion of local search: Study

By Giselle Abramovich

December 10, 2007

Scott Dunlap, CEO of NearbyNow

The upcoming year has great potential for both local and mobile search, according to a new study by NearbyNow, an online service that lets U.S. consumers search all products, brands and sales available at local shopping centers using the Internet or mobile phone.

A number of retailers such as Wal-Mart and Circuit City have gotten their local inventory online. A host of companies are also working to make it easier to search inventory data on mobile phones to enable product-specific searches.

“This is going to make local search explode in 2008,” according to NearbyNow’s Top Local Search Trends for 2008 report. “Consumers begin to expect instant information based on localized search. Homes with broadband connections will begin using the Internet more frequently in place of the Yellow Pages, because it has the current up-to-date information.

“Local search, considered by some experts to be as much as 30 percent of all current searches, will continue to grow and enable the search industry to keep booming,” the forecast said. “The advertising dollars will follow.”

Mobile supports online, in-store
NearbyNow has identified five key trends for next year. First, local search will get specific and become better than the Yellow Pages. Second, Internet and mobile convergence will pave the way for the search/purchase experience. Third, multichannel advertising will go live on local search.

Next, expect more location-based services. Finally, online-to-store shopping will bring instant gratification.

“Mobile devices are becoming more and more of an essential with Internet and in-store experiences,” said Scott Dunlap, CEO of NearbyNow. “People are finding what they need online, sending the information and directions to their mobile phones and then going to the store to get what they need.”

He said that consumer interest brings about more advertiser interest, making mobile an integral part of the media mix.

“[Mobile] needs to be considered in the media mix,” Mr. Dunlap said. “There is enough critical mass there that you can see what [consumers] are looking for.”

Almost all of the retailers that allow consumers to get an SMS receipt from a "buy online, pick up in-store" capability will see 30 percent to 40 percent of their customers use it, according to NearbyNow’s study.

“The concept is the beginning of the experience that connects the Internet, mobile and the store into a seamless search and purchase experience,” the report says. “This is going to force a lot of retailers and brands to think about mobile as a necessary part of a larger experience.”

Place is new context for ads
The study points out that location-based services are getting hot because "place" may be the single most powerful context for advertising, short of keyword.

And keyword + place + now is the trifecta for one-to-one marketing, the study says.

According to market researcher Kelsey Group, there were six times as many keywords with a cost-per-click (CPC) of more than $1 in January 2007 than in the same period the year prior. CPC increased an average 33 percent each month in first-quarter 2007 compared with the year-ago period.

“How much would a jeweler pay to target someone in the mall looking for a $20,000 necklace?” Mr. Dunlap said. "Local CPC display will evolve to be a major factor within the next 12 to 24 months when we will see the beginning of the words 'near you' included in the marketing vocabulary like never before.”

NearbyNow forecasts that "Get it now" will become the killer application next year.

"These are a few of the key topics we think [that] will be consistently discussed during the conferences and industry events in 2008,” the study said.