How to Pick Your Next Business Location: A Digital Marketer’s Perspective

Expanding your business to a second or third location is an exciting milestone, but it also comes with its own set of challenges. As an SEO and marketing expert who has worked with clients in over 24 states, I’ve seen firsthand how the right location can significantly impact a business’s success. Through that journey, we’ve helped clients go from their first location to two, three, and beyond!

The following is a list of considerations purely from our digital marketing and SEO perspective that can save small business owners some stress and help make your new location a thriving success. We hope that the data and questions we present spark additional discussions as your team develops its multi-location expansion plans.

Understand Google’s Proximity Bias

First, you must understand that search engines have an inherent proximity bias. Proximity bias refers to the tendency for search engines, especially Google, to prioritize businesses that are geographically closer to the searcher. Even if your new location has better amenities, more customer reviews, and a better website, Google may still choose to show businesses geographically closer to the searcher. This means that where you choose to open your next location will significantly impact your visibility in local search results.

Of course, proximity is only one of thousands of factors that Google considers when ranking a website, but it is a very strong one. For a deeper dive, check out our detailed article on proximity bias and its impact on SEO.

A Caution Regarding Shared Office or Co-Working Space

If at all possible, we highly recommend that you avoid shared or co-working spaces, as these can negatively impact your SEO efforts. A location with a unique, dedicated business address, separate entrance, and company staff ready to greet visitors are more effective for local SEO and abide by Google’s guidelines. Additionally, you avoid the colossal SEO mess of hundreds, or even thousands, of current or abandoned business listings using the same exact address.

Analyze the Competition

Before settling on a new location, it’s crucial to understand the competitive landscape. Ask yourself:

• Who are the nearby competitors? Identifying the businesses that offer similar products or services will help you understand the competitive intensity. Identify their unique strengths and weaknesses in comparison to your own business.
• What is the density of the competition? A high concentration of competitors could mean a saturated market, while too few competitors might indicate a lack of demand or an excellent opportunity.

Additionally, consider the impact of Google’s Possum Update, which may filter out neighboring businesses who have very similar service offerings (including primary GBP category) within the local pack (powered by Google Business Profiles). This update aims to diversify the search results but can also mean that being located too close to a competitor (with similar service offerings) might negatively impact your visibility, especially if you’re the new entrant to the neighborhood.

Know Your Customers

Your new location should cater to your ideal customers. You should consider the following customer-centric factors:

• Demographics: Who are your ideal and most profitable customers? Research the demographics (e.g. income, education level, spending habits, employment rates, overall economic health, etc.) of the area to ensure it aligns with the target market you are trying to reach.
• Convenience: Is the location easily accessible for your customers? Think about parking availability, public transportation options, neighboring businesses, and overall convenience. No one wants to go to a new spa located by the local landfill!
• Signage and Visibility: It’s critically important that the location you select has great physical visibility from nearby streets. Check with the landlord as well to confirm what signage is available. Keep in mind that your office space and associated signage can serve as advertising billboard!
• Foot Traffic: Evaluate the level of foot traffic in the area. High foot traffic can lead to increased walk-ins and impulse purchases, especially for more retail-oriented businesses.

Understanding your customer base and ensuring your new location meets their needs and preferences will help you attract and retain more customers.

Prioritize Employee Satisfaction

Happy employees are productive employees, and their satisfaction should be a priority when choosing a new location. In essence, you have to “sell” any location to your current and future employees, not just your customers.

• Preferences: Survey your employees to understand their preferences and what impacted their decision to work with your company in the first place. If you’re considering moving existing employees, we recommend having multiple honest conversations with employees who might move as early in the process as possible.
• Convenience: Ensure the location is convenient for commuting, whether by car, public transport, and/or bike.
• Amenities: Proximity to amenities such as restaurants, gyms, schools, and childcare can significantly enhance employee satisfaction.

Don’t make the mistake of only thinking about your customers when deciding on a new location. Satisfied (or dissatisfied) employees can make or break a new location’s success.

Balanced Success for Profitability and Marketing Reach

Finally, assess the practical aspects of the new location that will affect both your marketing efforts and the long-term success of the new location.

• Cost: Ensure the rent or purchase price fits within your budget without compromising your financial stability. Make sure you can account for all the practical costs of a new location, and don’t neglect the increase in marketing costs to both initially ramp up and sustain the locations’ book of business.
• Sustainability: Consider the long-term sustainability of the location. Will it continue to attract customers and remain viable in the future? Are there plans for the growth of this particular area that could positively or negatively benefit its success?
• Expansion Opportunities: What happens if your business grows even faster than expected? You don’t want to have to move locations again rapidly due to outgrowing your space. Ensure the new space has ample room for your company to grow. Discuss expansion options with the landlord should you need additional space (e.g. adjacent units, remodeling options, etc.).
• Networking and Industry Presence: Evaluate the presence of industry associations, networking opportunities, and business support services nearby. Great business support (like local chambers of commerce, leads groups, etc.) can jumpstart your company’s growth.
• Infrastructure and Technology: Ensure that the new location has adequate infrastructure, including reliable internet connectivity, utilities, and business-specific resources that support your operations.

Choosing the right location for your business expansion involves balancing customer convenience, competitive landscape, employee satisfaction, and many other practical considerations. By taking a holistic approach and leveraging insights from SEO and marketing perspectives, you can set your new location up for success.

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