Without it, it would be more challenging to find your business online. Less than 10% of the local pack results would have landed on the first page of the search engine results page. 80% of any search volume goes to the first page results. 71% to the top 5. Without local SEO, you are unlikely to make the cut.
Local SEO helps to level the playing field somewhat so small businesses can have the opportunity to be visible when people are near their location and searching for products or services that are relevant to their business.
This is an example of the 3 pack for the search "Italian Restaurants Near Me"
Local search algorithms work on what I like to call the “biggest hill in Kansas” principle. This means the local landscape sets the bar by which you will be measured. Typically, the smaller you make the reference field or more narrow you make the topic, the more likely you rise to the top.
There are exceptions, like in the New York metro area. Here, it is more akin to the biggest hill in the Himalayas.
It is a bit of an art and a science to find the right balance between scope, geography, and search volume. If the region is too small, there is likely no one searching for it. The same is true regarding the topic.
Here are the three things that you need to consider with local SEO for your business website.
For proximity, it depends on how crowded the neighborhood is. A mile in Manhattan, NY is much different than a mile in Manhattan, KS.
For prominence, again this is a competitive metric. The more crowded your location is, the more difficult it will be.
Finally, on relevance, this is no different for normal SEO except you are ranked versus your peers. If you are in a room filled with Einstein clones, it will be hard to pick out the smartest.