Local Search: New Law Targets Internet Marketers Posing as Local Businesses
By Anna Johnson on August 9th, 2010The Minnesota State Government has passed a law outlawing out-of-state Internet marketers from posing as local small businesses by, for example, running search engine ads indicating that their business is based in Minnesota.
Businesses advertising online or in phone directories will violate the law if:
- Their advertised name indicates that the company is based somewhere other than its actual location (e.g. the name includes a local town when the company is really located elsewhere);
- The listing doesn’t identify the actual business location; or
- The listed ‘local’ phone number forwards a caller to a location outside that calling area.
Minnesota State Representative Steve Simon was inspired to sponsor the law after local florists and locksmiths complained they were losing business to companies pretending to have a local presence.
Such companies typically ran search ads (or print ads in telephone directories) that positioned them as being from the local area. Their names often included the name of the local town, suburb or region, and their phone numbers had a local area code. They may even have had a local address that was actually nothing more than a postal box. When a prospect called the local number they were routed to a call center located elsewhere – somewhere else in the country or even overseas.
There is nothing inherently wrong with using a local phone number and forwarding calls to a call center located elsewhere. Nor is the Minnesota law aimed at ‘middlemen’ between local businesses and customers who don’t claim to be local Minnesota businesses.
For example, a franchisor that routes inquiries to local franchisees would not be violating the law. Rather, the law is targeted at out-of-state companies misrepresenting themselves to be local Minnesota businesses.
The Minnesota law should serve as a warning to Internet marketers seeking to capitalize on local search by, for example, buying domain names that include specific geographical regions, and then advertising themselves as local service providers.
Source: Kate Kaye, “Minnesota Law Goes After Phony Local Advertisers,” ClickZ, August 3, 2010
