Thankfully local online market has finally started to take off. As more local information becomes available online, people are starting to look at Internet as something useful instead of a passing fad.

And where people go, advertisers are sure to follow. The amount of money spent on local online advertising has steadily increased in last few years. According to The Kelsey Group (http://kelseygroup.com), geocommerce, or local advertising revenues, are expected to reach about $50 billion by 2006.

Here's another reason local online market is heating up: technology. The ability to target online users by geography - Geotargeting -- allows websites to present ads only to consumers who live in certain geographic location. Local advertisers can now be sure that only local eyeballs will see their ad.

Localized advertising is very targeted, and can be used to quickly and cheaply test online campaigns. Local merchants can use a combination of online and offline advertising to drive traffic to their store and website.

Geotargeting has great promise, but it's not without problems. The main issue is accuracy. There is a big difference in accuracy of methods used to target based on user location.

COMMON GEOTARGETING METHODS

- I.P. Address

Targeting based on I.P. address (a unique string of numbers that identifies a computer on Internet) This method works by using I.P. address to identify a user's geographical location. It can home in on a user's city - sometimes even their zip code - within U.S. and internationally. Many of major Geotargeting vendors use this method, including www.quova.com, a major player in geolocation market.

There are a couple of weaknesses in I.P. method. The biggest problem: for various reasons, not all I.P. addresses can be mapped to a geographic location.

A good example is AOL user population. Because of way AOL handles their web requests, all of their users appear to be coming from Virginia. Of course that's not true.

Here are 5 ways that consumers are using Internet:

E-MAIL

According to Messaging Online, there were around 891 million email addresses at beginning of 2001. By now there are probably 1 billion or more. Almost everyone has an email address, or knows someone who does. It's fast becoming as common as telephone, and just as necessary. Even if you don't have a website, you can use email to communicate with your customers. Send them useful information, coupons, and special offers. If you don't, someone else will.

PRE-SALES RESEARCH

For many consumers, internet has become great equalizer. They no longer have to take word of a salesperson -- all information they need to make an intelligent decision is online. Consumers can research everything from products to retail services, and make sure they get best deal. But unless your business is online, it's unlikely they will find you.

ONLINE SHOPPING