Not long ago, local advertising meant taking out an ad in the local newspaper or the Yellow Pages, but recent developments have changed everything about how small businesses market their products or services. While the Internet has a tremendous reach, it also offers the opportunity for businesses to target customers in the smallest niches and neighborhoods.

Advertising through traditional local outlets is still a viable strategy for small businesses, but online mechanisms offer a more sophisticated platform that yields more precise results. One particularly effective form of Internet marketing is search engine marketing, commonly referred to as SEM, which affords companies the ability to reach potential customers in specific locations.

Some of the benefits of an SEM campaign include:

* Local search advertising options allow businesses to target customers from a specific location, using the Internet user’s IP address. Few advertising options offer such a precise avenue for reaching customers near your business or in other desirable target locations.

* Pay per click (PPC) advertising allows you to invest only in advertising that you know is being read by potential customers. Instead of paying a fixed amount for an ad without knowing how many people will actually read it, PPC models charge the person who buys the ad each time a potential customer clicks on the ad to learn more. This amount is usually capped, so you don’t end up paying more than you can afford.

* Pay per click companies, such as MerchEngines by Deluxe, offer PPC management programs that help you manage your online campaigns. Such programs can also help you track where your online referrals are coming from, helping you decide which online marketing platforms work best for your business.

Using these types of programs can help bring in local customers who haven’t yet heard about your business. As you compete against bigger businesses, local search advertising is yet another way to level the playing field and remind customers in your community about what’s special about their local businesses.