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Local as a Service (LaaS) Firms Making Their Marks

by | Jul 12, 2018 | BIA, Blog

National brands want to both look good at the local level and drive engagement. Balancing brand policies with local autonomy is boosted with automated platforms. The “Local as a Service” (LaaS) space is dynamic and innovative, comprising a landscape of companies that exist to connect national brands to local consumers at scale leveraging technology, platforms, data, and automation. BIA has been featuring this space in our Local Impact conference series, and today we’re releasing, National Brands, Location Activation,” our first report in our new LaaS series. In this complimentary report, we highlight some of our proprietary data and the results of interviews with several leading LaaS executives.

Here are some highlights from this report:

  • By 2022, national brands will spend $74.8 billion in paid media to reach local audiences through a variety of channels including direct buying and funding through co-op and market development fund programs.
  • Over half of local SMBs that are brand franchisees report their franchisor reimburses half or more of all their paid media spending.
  • About 60 percent of SMB franchisee advertising spending is for digital platforms, but only a third of co-op and market development funds are spent in digital.
  • For two-thirds of SMB franchisees, the most important goal of paid media advertising is to drive phone calls.
  • For companies in the LaaS space, the opportunity they see is to add value to brand CMOs trying to integrate national brand campaigns focused on building brand awareness and favorability with local activation campaigns designed to engage consumers and provide a consistent customer experience. Data, tech, and increasing advances in artificial intelligence and machine learning are disrupting the old order by reducing friction, enabling business rule driven workflow, and supporting integration and customization at scale.

National Brands-Local Activation Forecast 2018

Executives in the LaaS space we interviewed definitely see successes, but also lots of opportunities for innovation and business growth.

  • “It is our opinion that brands are still struggling to evolve their marketing strategies. Brands have over-invested heavily in partnerships that are not as successful now but are unable to undergo the fundamental shift in thinking required to spark change, which can mean altering the advertising dollars, strategy, and investments already made.”
  • “Brands and their distributed retail networks must adapt to the complex reality of a click-to-brick economy. Most brands understand the importance of delivering a seamless experience across digital and mobile platforms and are quick to pour money and time into aligning customer experiences online and across devices. But in doing so, they are forgetting about the most important channel: the local brick-and-mortar store.”
  • “Indirect distribution is at a crucial turning point. Local Partners face the most competitive market in history with e-Commerce giants and Big Box retailers using superior marketing expertise and deeper pockets to capture customers. Indirect distribution is also, by nature, highly complex, and Brands are finding it more expensive and difficult to get a broad set of marketing tools in the hands of their Partners.”

Download the complimentary report here.

 

 

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