There are two sectors search and advertising have yet to dominate: social and local.  But recent rumors indicate that Google’s hoping to kill two birds with one stone, beating Facebook to the punch by leveraging its widespread products and building on its long-standing dominance in the search advertising space.

Google in the past has tried to capture the local business ad market with several attempts, but most of them suffered from one misstep or another. The search engine giant is at it again, planning as early as July the launch of its small business services, Business Builder, to crack the local business market for advertising.

At present, the size of the local business advertising market has reached about $20 billion.  With Business Builder  Google will integrate a variety of products and services aimed at small business customers. WSJ reported that the Business Builder package will be a mix of internally developed software and recently acquired technologies, citing sources close to the matter.

The package will have Google+ Local pages, AdWords Express, Google Offers, Delivery (a new service that would enable stores to deliver products to homes), Google Wallet (a combination of online payment and smartphone-enabled payment at a POS), TalkBin (an SMS-based customer feedback tool) and Punchd (in-store loyalty program, which Google acquired last July).

“Much of the information from a business owners’ Google Place page – such as the business address, phone number, description, and Google reviews, and photos submitted by business owners and users – will automatically be ported over to the upgraded local Google+ page,” a Google spokesperson told WebProNews. “People used to be able to find information about a business on the Google Places page, but now, they’ll find much of that same information on the local Google+ page and enjoy the added ability to share that information with the people in their Google+ Circles.”

The localization of social search

Google’s new ambition will be centered on its social networking site Google+.  Google hopes consumer will interact more with local businesses through their budding social interface. Local business will create special pages on Google+ to get traffic from Google’s search engine. When consumers go to these pages, Google wants consumers to use Google Wallet services to make purchases, in turn building loyalty around its own collection of services aimed at the hyper-local level.

On the other hand, Google wants the merchants and other businesses to use the Google+ pages to communicate with consumers.

“This means that a business listing that could previously be found across Google Search, Google Maps, and Google Maps for mobile is still available in all those places, but is now also more easily discoverable to the millions of users on Google+ as well,” Google said.

AdWords Express, launched last July, enables local businesses to start advertising online in less than 5 minutes.  The expedited program helps potential customers find your website or Place page, and gives consumers a quick and straightforward way to connect with business.

Google Offer is another marketing tool through which Google hopes to win local customers. The service, though successful, is to not limited to just being a daily offers site, but the goal is to integrate it with other ad options aimed at local and small advertisers.

The SoLoMo ecosystem

Google is not the only player that’s re-entering into the lucrative location-based marketing business. Microsoft is also working on a solution by integrating location-based adverts into its Local Scout product, an app for Windows Phone that helps users find local venues like restaurants, retail stores, entertainment outlets, etc.

Then there’s Groupon, who recently reinvented the multi-billion dollar local commerce market with a series of products designed to expand beyond its core business. Groupon said that are building an integrated suite of tools and services that will profoundly change the way we shop locally. The company’s SmartDeals software will be extended to emphasis on mobile offers and a rewards scheme is also being undergoing trials to give extra benefits for frequent buyers from the same merchants.

Foursquare is also reportedly planning to launch paid search ads in June. The service will be based on Foursquare’s GPS system, which merchants will use to promote deals in certain areas.