6 Lead Generation Strategies for Local Businesses

strategy concept

Small businesses advertising in their own local market often operate under the “big local lie.” It’s common to see small business owners who have tricked themselves into believing that they don’t need to advertise at all and can rely solely on referrals for lead generation and repeat sales.

These small businesses will quickly discover that relying on referrals alone will cause them to get stuck in a growth holding pattern.

Let’s look at six ways smart local businesses can get more leads. As you can see, it doesn’t take a big marketing budget for small businesses to increase new leads and get more referrals.

  1. Focus on Lead Capture—Establish a standard process for your business to capture lead information during any interaction with a potential customer. Train employees on the process and emphasize its importance for future business growth. When you’re interested in direct responses, you need to ask the right questions. You need to gather useful information that allows you to make business decisions that add up to profits. Coupons, discounts and trials are effective offers for capturing lead information in person. Forms, white papers and demos are effective ways to engage with your website audience and capture useful information.
  2. Use Local SEO—Establish a Web presence for your business and optimize your website. Tools like Google Places are essential for getting listed and found online. Use the Google keyword tool to research common phrases people use to find your product or service. Make sure your page titles use those key words, and write page copy with those key words. Also, find and engage with local, influential bloggers. Build a relationship with them, or even offer to write a guest blog post twice a month. It’s never too late to get involved in social media and use it as a mechanism to drive traffic to your website. Make sure you’re using lead magnets across your social properties to capture information.
  3. Segment Your Contact Database—Get the right message to the right person at the right time by tracking behavior. Monitor who visits your website, what Web forms they fill out, what emails they open and what links they click. Demographics and psychographics allow you to target your message and offering. Clearly outline the benefit your product or service offers based on your potential customer’s needs.
  4. Create Partnerships—Build relationships with businesses that offer complementary products and services. Build your partner’s business into your business and yours into theirs. Make lead capture and your partner’s offering part of the entire sales and delivery process. The key to a powerful partnership is to create added value for your customers.
  5. Promote Local—Local consumers want to benefit their local community. Consumers will buy local when it is convenient, when they have a relationship with you, and when they are informed. Consumers will even be willing to pay more for a product or service once they are loyal to a local business. There are numerous coalitions and organizations that support locally owned businesses, which form the backbone of the local economy. Join your local chapter of Local First and chamber of commerce to stay informed and visible to local consumers.
  6. Develop a Referral Strategy—Create a methodical way to generate referrals. Outline a systematic referral process and incentivize your employees for collecting referrals. The best time to ask for referrals is at the time of purchase, shortly after a recent purchase or after a customer satisfaction survey. Caution: Never ask for a referral when a customer is not happy. Track referral volume and conversion rate month-to-month.

Lead generation does not have to break the bank. Established processes and focused execution have the power to grow and sustain a small business. To hear about more strategies for increasing local lead generation activities, check out this previously recorded webinar.


Tyler Garns Tyler Garns, Business & Marketing Strategist at Tyler Garns Marketing LLC, has over 10 years of experience in the field and is a recognized expert in Internet marketing. Tyler specializes in building "done-for-you" campaigns. You can follow him on the Tyler Garns Blog.

34 Reactions
  1. These are great ways to grow a local business and I see too few companies leveraging the internet in their efforts. However, it’s important to note that this entire discussion is based on the assumption that the business owner wants to continue growing. There are actually many small businesses that don’t want to grow past a certain point (for various reasons). These companies may be able to get away with limited marketing.

  2. I really like this post. Companies seem to lose sight of local markets as they grow, and when they realize the potential for business close to home they forget how they used to do things, if they ever knew.

  3. Karla @ Business Finance Store

    These are great tips, especially #4 and #5. These days there is a great emphasis placed on getting online and using social media that businesses often forget about personal connections with those physically around them. Our neighbors are great partners, customers and resources. Thanks for reminding us not to lose that personal connection.

  4. We have found that #1, #2, #3, and #5 can be easily achieved using text marketing. #4 can also be achieved, but takes a little more creativity. Connecting and reaching back out to customers has proven very successful for our small business customers.

  5. Along with #5 and #6, I have found that one of the best ways to promote local is by effectively using customer feedback in forms such as online reviews. In fact, I have built tools for clients in the past that connected a customer satisfaction survey to their Google places page so that their customers could take a survey and submit their online review all in one step. These days, the easier you make it for your customers, the better.

  6. Small businesses are usually traditional businesses with traditional businessmen. This means that having a web presence is a big decision obstacle itself.

    The world is getting larger and the competition are getting many. It’s just not enough to place a sign in front of the store or place posters all over the neighborhood.

  7. Thanks for sharing these great reminders. One thing I would like to add is not to forget that different parts of your prospect and customer base react differently to various media. It is easy to fall in love with just doing email marketing or social media or any of the dizzying new media offerings that seem to be popping out every few days.
    Each type of media has its own strengths and with a little thought and strategy up front, you can take advantage of that media even with a limited budget.
    It would be a shame to do all the work to get all those leads and then have your marketing messages end up in spam folders or go into the trash can.

  8. Thanks for the comments everyone. One thing that I see over and over is that it is easy to get distracted with every new tool & tactic out there. The process of growing a business hasn’t changed. If we all focus on the core of that process, and then use the tools & tactics that help us drive the core process, we’ll be much better off.

  9. Great post Tyler. There are plenty of lead generation available for local businesses. The trick is to look for the perfect tactic for you.

  10. Lionel Bachmann | Model Trains

    In internet marketing, you always come across the saying “the money is in the list.” Well, you pointed out that it’s not just for internet marketers. It has been a part of offline marketing for some time. Getting leads is an important part of not only getting to know more about your customers & their interests, but being able to get in touch with them later to bring them back.

  11. It’s all about “branding.”
    Join your local Chamber, donate some time by giving back to your community!
    Becoming locally “conscience” will improve your bottom line.

  12. Great tips! There are a lot of different options out there for lead generation, and even small companies can look to third parties to facilitate this need with a relatively low cost. If companies are focused on growing, this would be a great idea because generating new leads is difficult and time consuming, and third parties have targeted campaigns that can reach out to a company’s ideal customer, segmented by location, size of company (for B2B), title, etc.

  13. Great article. It is also important for any business to be validating the contact information they are collecting on customers at the point of sale. It doesn’t do them any good to have a database full of incomplete consumer information. Worse, a pile of returned mail or the apparent hassles of maintaining the data could turn a small business away from direct marketing.

  14. Some good tips here, but I’d also like to recommend using PR. Small businesses often think they need to hire expensive agencies to publicize their companies, but it’s easy to get started writing your own press releases using templates you can download online. Using press releases to market your everyday success, such as new customer wins, new products you offering, or even an event you are speaking at, are great ways to promote your company cost effectively. Press releases can be posted to your website, helping to drive traffic, provided to your sales team as news to share with clients/prospects, as well as emailed local news magazines. Because small business owners know their businesses the best, they should invest some time putting their story into words – creating content that can help them drive more business.

  15. Sue – thanks for your comment. Since this post is about “lead generation” I’ll just mention that most PR efforts don’t result in leads directly. Most PR efforts result in increased awareness which may translate to leads over the long run if you’re consistent with it. If your PR is truly contrarian or disruptive, it can drive more results. But again, depending on what the story is, it might just drive traffic, but not targeted traffic. I’m not suggested that small businesses don’t utilize PR to drive leads, but when you have limited time & resources, there are more effective ways.

    Roy – my sentiment towards “branding” is similar. Most small businesses are not interested as much in branding as they are in get new business now. Creating a recognizable brand usually takes more time, effort, & money that what most small businesses are willing to stomach in the beginning. My recommendation is to focus on direct revenue generating activities first. Then, focus on branding, PR, and other long term efforts once the bills are being paid and the business is growing. They’re both crucial to long term growth, but not always necessary to getting the business off the ground.

  16. One medium that was not mentioned here is yellow pages. My husband works in the industry and even though its not as glitzy as the internet the fact is that it is still a viable medium. The advantage it has is that it is directional i.e. a buyer looking for a seller. There is no doubt that there is a shift to the internet but the book is not dead and probably will have a role in local marketing for some time to come.

    • At mTrax (mtrax.com), we’re finding that many of the small local businesses that we interact with have become dissatisfied with the Yellow Pages. There is a very real sense that, measured on a cost-per-call basis, the Yellow Pages are simply overpriced. These small businesses are starting to take advantage of a new-tech alternative: mobile search on Google, Yahoo, and Microsoft. It works, is scalable, testable, and much more responsive to their needs.

      And there are more and more people out there who are searching for local businesses on their cell phones, and calling right away.

  17. “Lead generation does not have to break the bank”-this is exactly what marketers need to understand Tyler. Though lead generation looks expensive and, in truth, it CAN be expensive, there are some things to take into consideration that will lower that cost. Good to see cost-cutting techniques here. Thanks for sharing.

  18. Great stuff and your analysis includes the MOST effective, yet least used way to get new business…referrals.

    Anyone who does not have a referral program needs to get one. If it is automated, that’s better. And if you aren’t asking for referrals from your customers, you’re letting revenue go down the drain.

  19. These are some great points, unfortunately I have seen established businesses become complacent and forget to do what grew their business. People move, die or sometimes in spite of your best efforts become dissatisfied. You have to be constantly replacing your customer base in order to grow.

  20. I’d add one other which is local pay per click which, looking at lifetime value, cost per lead, cost per sale etc is still very effective.

  21. One point that was not mentioned is networking. I have sold more motorcycles to friends and family of satisfied customers. I believe in following up with customers multiple times after the sale to make sure they are happy and have no problems. The majority of people out there believe it or not will not complain about small problems for fear of being perceived as a winer. The multiple follow ups ensures a repeat customer at least and often additional sales.

  22. I have a moving company in Fort Smith Arkansas and referral programs have been one of our best ways to grow our business. The best type and least expensive form of advertising is a satisfied customer.

  23. I personally feel that “Focus on Lead Capture” and “Segment Your Contact Database” are by far the 2 most important action items on the list above.
    “Knowing” your customer database is key for growth! Finding out who your best converting leads & customers are will dramatically help ALL marketing efforts.

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  25. These are the best lead generation strategies for local business. You can also use lead generating software which will save your time and generate revenue opportunities.

  26. I appreciate your tip to track the behaviors of people visiting your website like the forms they fill out or the links they click. The small water treatment company I work for has been trying to figure out how to find some sales leads as a way to get more customers. I will definitely tell the water treatment business that we should definitely hire someone to analyze our website’s demographics so we start to more clearly target our message and create sales leads.