Top 5 Reasons Local Businesses Fail at Digital Advertising (And How to Fix Them)

Digital advertising isn’t a new concept, but it’s playing an increasingly vital role for local businesses year after year. According to Taradel’s 2023 Small Business Marketing Survey Report, which collected responses from 218 business professionals and advertisers, 94% of small businesses planned to maintain or increase their digital marketing budget in the new year.

This means that even if a digital marketing plan has worked in the past, other marketing efforts could surpass it as more businesses present competition. To stay ahead, it’s important to strengthen your digital presence proactively and avoid these five common pitfalls that can squander resources and ultimately cost you customers.

Wasting Your Marketing Budget

While large businesses have the luxury of significant marketing resources, local businesses typically face tighter financial constraints. As Taradel notes, “SMBs reported that their biggest marketing challenge is budget.”

That’s why making every dollar count is crucial for local business success. Digital advertising offers the flexibility to fit any budget while still delivering measurable results. However, selecting the right channels and strategies is key to maximizing that investment. If mismanaged, it could lead to fewer impressions and, as a result, fewer conversions into sales.

Don’t Exclude Audience Targeting in Digital Campaigns

The first step in building a strong digital footprint is investing in marketing your business. However, it’s just as important to recognize when your strategy isn’t delivering the desired results, so regularly evaluating the success of your efforts is essential. 

Taradel found that just 37% of small businesses believe their marketing campaigns are “somewhat effective,” while 22% rate them as “not effective.” When contrasted with the fact that only 11% say their approach is “highly effective,” it becomes clear that every small business should ensure its approach is the best for them.

Acknowledging when your current strategy isn’t working creates an opportunity to improve and prevent further setbacks for your business, and among the most effective methods of improvement is to prioritize audience targeting.

Taradel’s survey revealed that audience targeting is the biggest “pain point” when it comes to the execution of marketing strategies. Putting your business in front of the right audience can significantly boost conversions while making the most of every dollar invested. Whether your budget is big or small, regularly evaluating and optimizing your digital advertising efforts is critical to long-term success.

Ignoring Analytics When Tracking Performance

You may recognize that your marketing efforts are falling short of expectations, but how exactly can you measure performance to ensure improvements as changes are made? Tracking the effectiveness of your digital marketing campaigns through analytical data is one of the most powerful tools at your disposal. It may seem simple, yet many local businesses neglect this tool.

Clutch reports that “over 52% of SMB decision-makers view data analytics tools as critical for growth, and 42% are prioritizing strengthening data-driven decision-making in 2025.”

Embracing the power of analytics can give you a leg up on the competition and help you make the most of your budget. In the ever-evolving digital landscape, local businesses can’t afford to ignore the value of tracking and evaluating their results.

Restricting Reach By Limiting Marketing Channels

Local businesses that rely on just one or two marketing channels risk significantly limiting their results. An effective digital advertising strategy leverages multiple platforms and geo-targeting to increase visibility and improve the chances of converting potential customers.

Facebook remains one of the most widely used marketing channels, and for good reason. According to Taradel’s survey, ~29% of small businesses reported that Facebook delivers the highest ROI, outperforming both digital and print alternatives. With 2.9 billion users, it’s the largest social media platform, making it an ideal starting point for local businesses launching their digital marketing efforts.

However, Taradel also revealed that “it takes 7 impressions to influence consumer purchasing decisions.” While Facebook can serve as a strong foundation, diversifying your approach by adding more channels can accelerate how quickly customers discover and engage with your brand.

Instagram is another platform consistently delivering results, but social media isn’t the only option. Google Ads and display advertising can extend your reach well beyond what Meta platforms alone can offer, while still taking advantage of audience targeting to optimize your marketing budget. 

Employing both Google ads and display advertising allows your business to appear across the internet for your highest value customers, even when they aren’t actively searching for what you offer.

When the goal is to get your business in front of as many potential customers in your local area as possible, using multiple marketing channels isn’t just a best practice; it’s essential.

Neglecting the Power of Outsourcing

By now, it’s clear how important it is for local businesses to maximize their digital advertising efforts. When you pair that with the need to manage your business’s online listings, it can feel overwhelming, and you’re not alone.

Marketing Charts found that “Lack of time is the leading reason why SMBs delay or procrastinate marketing tasks, particularly for posting on social media, entering/integrating data, and managing their email campaigns. Lack of knowledge is also a key reason for procrastination, and is more acutely felt in the areas of planning/creating a strategy and determining what is working/measuring performance.”

That’s why outsourcing is the best option for many business owners, as it frees them up to focus on their products, services and customers. 

Many local businesses have already chosen that route, and more are expected to follow suit. Clutch reported in 2024 that 84% of small businesses already outsource some operations, and 70% planned to increase outsourcing in 2025. 

This is a result of the growing marketing space that business owners can struggle to keep up with. Often, a specialized team is required to optimize resources, and that’s usually easier and cheaper to do with a hired service rather than in-house. 

Find Success With Your Digital Advertising Today

Best Version Media can be your one-stop shop for all your digital advertising needs. With over 13,000 digital campaigns and 3 billion annual impressions for local businesses, BVM has a proven track record of delivering results, no matter the budget.

From listings and reputation management to social media and display ad campaigns, BVM makes it easy to increase your online presence, all in one convenient dashboard. This means you can focus on what matters most, growing your business.
Contact BVM today to reach more customers in your community.