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Spend Local--Online

Reach a younger, hipper market for a fraction of the cost of traditional advertising.

This story appears in the August 2009 issue of Entrepreneur. Subscribe »

After 18 months of remodeling and construction, the scaffolding was coming down around San Mateo, Calif.'s Astaria Restaurant, and co-owners Alicia Petrakis and Eleni Lolas knew they were going to have to be creative to get the word out about their restaurant's new theme targeting a hipper, younger audience. "We started thinking about where we get information," Petrakis says. "People go online or to their smartphones; I haven't picked up a phone book in three years." So instead of putting all of their in the Yellow Pages, a local alternative weekly newspaper or a hot radio station, they decided to advertise mostly online, spending about $2,000 per month on properties like OpenTable, Yelp, Citysearch and EveryScape.

Local online advertising is growing at a fast clip as more businesses have the same realization. In fact, a new report by Borrell Associates found that companies spent $12.1 billion on local online advertising in 2008. And local online media are even starting to take a bite out of giants like Google and Yahoo.

Ed Delia's firm, Delia Associates, helps small businesses get local results online by looking for high-traffic properties that have areas of regional focus. "Start searching for local businesses on some of these sites and see whether they have a lot of them listed," he suggests. "Having a depth of businesses and reviews means that people are looking at the site." Delia often steers his clients to properties like Yahoo Local, MerchantCircle, Insider Pages and Angie's List, depending on the type of business. He also likes to test the websites of local print publications, since readers often view their favorite local newspapers and magazines online, and those ads are generally cheaper than their print counterparts.

The strategy is working for Petrakis and Lolas: Even in a down economy, the restaurant's business is up by about 30 percent and is expected to rack up $1.5 million in sales this year.

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