Why The Web Is FAILING Local Businesses

Broken Computer

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Local business owners are frustrated with the web. Yet it holds so much promise. What’s wrong here?   Generally, there is a common theme: everyone.com and their mother is trying to separate a business from their customers, rather than bring them together. Isn’t this the exact opposite of what the web is supposed to do?

Let me explain. For years, online dot-coms have built portals for customers to talk to each other, talk to strangers, talk to experts, all to get information about businesses. All this communication, but as soon as the businesses get involved, suddenly there is this awkward middleman.

He talks on behalf of your business, tells you what you can say, when & where you can say it, and to whom. What just happened? Whose customers are they? Consider if you owned a business and you heard these pitches:

Scenario 1 – Borrowing customers & renting out your business model:
“Hey! Want to run a daily deal? We’ll email a list of our customers (consider who has the credit card numbers) and resell them your services, LocalBiz. We can guarantee hundreds of our customers will use your services! The cost? All you have to do is let us use your business model at a 75% (!) discount. Assuming you don’t have 90% margins, your job is then to convince MY daily deal customers to come back, to become YOUR regular old customers. Of course when you do, you’ll be charging them twice as much for the exact same thing.”

–No wonder 400+ daily deal sites can afford to call business owners every day. Their customers pay them a lot to do so.

Scenario 2 – Cross promotion, to brand dilution, to appreciation fraud:
We have a hot new app that all the kids are ‘checking in’ to your business on. Wanna run a deal for free? No problem, LocalBiz! Just tell your customers to become my customers- to ‘download SocialBizFriend.com!’ Put signs up in your store, in fact, make it look like a NASCAR for dot-coms, because as it turns out there are hundreds of apps like mine.

If you do, we’ll let you engage with…  wait for it …your (now our) customers. People you brought me. Go ahead and offer them a deal. When you do, I’ll tell ’em for you & fraudulently take the credit. “This deal brought to you by SocialBizFriend.com!”
–Local Businesses are somehow left running ads for dot-coms, for free… not the other way around.

This is the crux of the problem with both scenarios: Businesses deserve to own that customer relationship. To talk to their customers directly.

When they get a sales call that mentions the word “customers”, they should ask the question – “Will I be able to contact this audience directly?” If the answer is ‘no’, it means they aren’t your customers at all, and there is almost definitely a ‘catch’, no matter how hidden.

The good news? This will change. The bad news? A lot has to change before we get there. It’s our vision at LocalResponse. But we’ll be the first to admit that we are just one fish in the largest of ponds. Local Businesses need to demand they own the customer relationship, and support the businesses that help them do so (there’s our shameless plug).

Local businesses get online-savvier every day. When enough are asking for Local 2.0, the floodgates will come crashing down.–MM

Editor’s Note: LocalResponse Co-Founder and CEO Nihal Mehta will be a featured presenter at “MESA Presents: The New Marketing maths [Data = Dollars]” on Thursday, May 19 in NYC. Leveraging new data in new ways is the Web’s answer to optimization, and it has informed a new marketing maths: data = dollars.

This post originally appeared at Mesa Global.