I sat in on a breakout session this morning at SES Chicago entitled “Local 2.0: The Evolution of Local Search.” Gregg Stewart from TMP division 15miles moderated, with two local SEO experts presenting, David Rodecker or Relevant Ads and Curtis R. Curtis from SharksFly Marketing.

According to the speakers, many of the old rules of local SEO are changing, driven by a range of factors, including the emergence of social media and advances in geo-location.

Rodecker noted that the use of geo-modifiers in domain names, once rewarded, is increasingly a non-factor or even detrimental. This is largely due to advances in how search engines identify user location. Rodecker noted that in his work with clients, he has seen wide variation in ranking between those with and without a geomodifier. Often the pages best optimized for a category saw better results than those optimized for geography. This was not a welcome message to some SMBs in the room  that had gone well down the geo-modifier path.

Both speakers made it clear that local online marketers need to find a long-term solution to using call tracking numbers without undermining themselves from an SEO standpoint. The search world puts a premium on on consistency, and call tracking numbers undermine this with a different numbers in each of the various online ads an SMB places.

Rodecker recommended using images and javascript as workarounds for call tracking numbers. While Curtis agreed, he was quite adamant in asserting that “call tacking is one of the things you want to avoid.” Given that much of BIA/Kelsey’s data suggests SMBs place a premium value on calls as a leads source, this is a serious issue for local marketers.

The speakers were also clear that the local ecosystem is not all about Google anymore. Bing is an emerging local player, and Facebook is already a local juggernaut, with 2 million online businesses and climbing, a number that is fast approaching the estimated 4 million SMBs on Google. Add to this the emergence of location based services like 4 Square and Twitter and the local ecosystem looks more and more like a multi-headed monster.

The room this morning was packed, mostly with small businesses or agencies that represent them, and the messaging was directed to those having to grapple with the constantly moving goalpost that is local SEO.

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Online “ad versioning” has taken on heightened significance as national and regional brands vie for their own piece of the sizable local advertising pie. However, as SEM becomes more sophisticated and consumers expect smart targeting from commercial messages, basic metro-level campaigns often don’t suffice. Kenshoo realizes that and is implementing its Conversion Attribution Modeling platform with national clients to allow them to effectively build out hundreds of search campaigns targeted to specific store locations.

Kenshoo’s director of product marketing, Ariel Rosenstein, told BIA/Kelsey that for retailers and other businesses with diverse geographical locations, consumers are in different “life cycle” stages (awareness, consideration, intent, purchase), meaning that keywords resonate differently based on a buyer’s position in the purchase funnel. If these distinctions are not accounted for, then the unwanted result can be the misallocation of online budgets to keywords that are not optimizing. Generally, this plays out with a business overvaluing the last click prior to purchase while discounting other keywords that may have been essential in driving the ultimate conversion.

Kenshoo’s Real Time Tracking mechanism gives large-scale businesses running multiple, simultaneous campaigns a location-specific window into where clicks are originating from and where they’re leading. Based on how this behavioral pattern points to conversion, combined with the goals of the client, a national-local franchise can apply weight attributions to decipher which keywords are most effective in driving purchases. Campaigns can then be modified to accentuate powerful keywords and redirect away from less effective ones.

For instance, if a business is courting initial customers, it may choose to place additional weight on early clicks that introduce potential buyers to a brand. Meanwhile, time-sensitive campaigns can invoke time decay attribution so that more recent clicks receive more value.

Image Credit: Kenshoo

Rosenstein showcased Kenshoo client Extra Space Storage as an example of the importance of attribution weighting to understanding the unique, and often segmented, behavioral and buying patterns of a customer base. Notably, nearly 25 percent of ESS’ conversions included “some geographic term, yet they were running general campaigns. They needed to add local keywords.” Additionally, almost one-third of conversions had “a brand keyword in the path,” making it important to shift away from “prefer last” keyword attribution to more balanced models that accounted for the importance of brand awareness. And in some geographic areas, conversions occur more quickly than in others.

The next game changer for national-local brands is social media, which plays a dynamic role in the customer life cycle and has heavy cross-over with search. Kenshoo is already using Facebook’s API to attribute conversions from social channels. Its next, more ambitious step is to build out a full social ad campaign management tool, currently in beta.

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As local businesses increasingly transition their advertising dollars online, they expect agencies and publishers to furnish them with simple, consolidated solutions supported by tangible, trackable ROI. MerchEngines built its white-label “relationship generation” system to enable online marketing providers to do just that for their SMB clients.

In a crowded online marketplace, where bigger firms such as ReachLocal, Yodle and WebVisible also compete to service SMB agents, MerchEngines’ value proposition is the comprehensiveness of the toolkit that publishers can implement and local merchants can benefit from.

There are eight key features in the suite, including a “SocialStream” layer that tracks activity across four prominent social networks (Facebook, Twitter, LinkedIn and Google Buzz).

PPC search campaign management is fundamental to online search offerings, and MerchEngines is no different, supplying a single interface to customize, amend and track campaigns across multiple search engines. Tied to both SEM and social is CallAnalytics, the branded service that allows SMBs to establish call-tracking numbers and monitor traffic from both search and social.

Also of note is OneList, which disseminates a local merchant’s listing across more than 40 business directories (Yelp, Superpages.com and many more). The eight-tool portfolio is encompassed in a single online dashboard that agencies and publishers can conveniently access to monitor and change campaigns.

MerchEngines was founded in 2005 by longtime Internet executive Andy Steuer. In 2009 it sold to Hostopia, the Web site hosting unit of Deluxe Corp.

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Yodle, the third-party SMB reseller, has now divided its business into “Yodle Sponsored” and “Yodle Organic.” The formation of the latter division, which has been live for a month with 150 clients, is a recognition that SMBs are increasingly relying on organic search as much as paid search — and they need help driving exposure to their Web sites, blogs, YouTube, and social sites such as Facebook and Twitter.

For $400 a month, with six-month initial contracts, Yodle Organic is set to pump up its clients’ organic search rankings. It will provide personalized consultations, design and code Web sites to maximize search rankings; help create and syndicate video; distribute local business profiles to search sites and directories; and provide a dashboard that allows SMBs to measure goals.

Yodle CEO Court Cunningham says the timing feels right. “SEO’s price-per-lead and price-per-click is substantially lower than SEM. But it isn’t ‘either-or.’ They complement each other,” he says. “SEO takes time to build your site so it becomes visible and builds authority in the eyes of the search engines. It is about building equity in a brand that is long lasting.”

The challenge is to properly scale the effort for each client and make money — Yodle gets an average of about $1,000 per month from its 7,000 paid search clients. “No one has productized and automated and put clear accounting” around something like this, he says. But “we’ve been building Web sites for three years. We’re experts in automation.”

Still, it is an ongoing experiment as Yodle works to get clients non-paid traffic in such new areas as maps, article sharing sites and even Google’s 7 Pack. “We look at these things as organic distribution,” says Cunningham.

Content production is probably the biggest question mark for Yodle (and for any company entering this space). Out of the gate, Yodle is using a combination of external contributors, internal editors and curated content from other sources. It hopes to provide at least 10 fresh pieces of content a month to each client.

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The deals fit into Berry’s broader strategy of becoming less print centric and more about selling a wide array of local media solutions, supported by performance measurement. To achieve this, Berry is collecting a growing list of partners to deliver components of this strategy, Yodle and Web.com being the latest two. Berry already resells Yellowpages.com and Google, and it has formed a deep partnership with 3L Systems and Salesforce.com to create the systems to enable the company to sell and provision media across multiple products and platforms.

“Our goal is to ensure that our small and medium-sized business clients are generating local leads from the multiple sources and platforms that today’s consumers use,” said Scott Pomeroy, president and CEO of Berry, in the announcement today. “We believe that Web.com and Yodle will bring best-in-class products, fulfillment and digital expertise to our clients, complementing our client-focused approach.”

A year ago, we talked with Yodle after it raised a US$10 million round. At that time, the company reported 5,000 advertisers and 250 employees. Yodle, like rival ReachLocal (which recently filed for an IPO), deploys a direct sales force.

As we learned recently, SuperMedia CEO Scott Klein is open to the idea of companies like ReachLocal reselling its inventory. The Berry-Yodle deal has Berry reselling Yodle’s products. However, we wonder if the Berry-Yodle deal couldn’t be a two-way street, given Yodle’s direct contact with SMBs?

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Real-time reservations have moved beyond restaurants, hair salons and parking garages and are now being offered for self storage units. G5 Search Marketing, which specializes in self storage, has teamed with Centershift and United Stor-All Management to launch Web sites that integrate G5’s SEO and clickthrough solutions with unit availability, pricing, promotions and payment.

The effort allows United Stor-All to consolidate the Web presences of 80 facilities in 17 states and D.C. that it currently manages, while generating brand awareness and Web traffic for its storage unit owners. It is the first of several third-party integrations that G5 has planned for 2010.

“Integrating at the point of sale enables us to close the loop and truly track a new customer all the way back to the origination point online,” says G5 CEO Dan Hobin. “Our clients like to know that they have a managed service.” At the same time, Hobin says clients expect “full access” to their sites and want to be able to make changes at will.

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