Medan MSMEs Must Rethink Local SEO as AI Reshapes Search Visibility
MEDAN, Indonesia — Local search optimization is becoming a critical survival strategy for small businesses as artificial intelligence increasingly influences how consumers find products and services online. A 2026 study by May Handri, Jam’an Amadi, Fajrillah, Zuhri, and Ari Lestari found that Micro, Small, and Medium Enterprises (MSMEs) in Medan can significantly improve their digital visibility by focusing on fresh customer reviews, hyperlocal content, and AI-friendly business data structures.
The research was conducted by academics from Universitas IBBI, Sekolah Tinggi Ilmu Manajemen Sukma, and STMIK Logika, and was published in the International Journal of Global Sustainable Research (IJGSR) in 2026. The findings are particularly relevant as search engines increasingly rely on artificial intelligence systems, including Google’s AI-powered search features and conversational AI platforms, to generate recommendations and answers for users.
According to the researchers, businesses that continue using outdated Local SEO tactics may struggle to compete in an environment where AI evaluates not only business information but also credibility, activity levels, and customer engagement.
Why Local SEO Matters More in the AI Era
Consumer behavior has shifted dramatically over the past decade. Smartphone users now frequently search for nearby products and services using phrases such as “near me” or location-specific queries. For businesses in Medan, one of Indonesia’s largest economic centers outside Java, online visibility has become a key factor influencing customer acquisition and revenue growth.
The researchers note that many MSMEs still depend heavily on traditional marketing methods, including word-of-mouth promotion and physical signage. While these approaches remain valuable, they are no longer sufficient to compete in an increasingly digital marketplace.
At the same time, AI-powered search engines are changing how information is ranked and displayed. Instead of simply matching keywords, modern algorithms evaluate trustworthiness, relevance, user experience, and real-world business activity. This shift has created new opportunities for businesses that can demonstrate authenticity and customer engagement online.
How the Research Was Conducted
The research team used a Systematic Literature Review (SLR) approach based on PRISMA standards, a widely recognized framework for reviewing academic literature.
Researchers examined 45 publications initially identified through Google Scholar, ResearchGate, industry reports, and digital marketing publications published between 2019 and 2025. After screening and removing duplicates, 15 highly relevant studies were selected for detailed thematic analysis.
The review focused on several key Local SEO factors, including:
- Google Business Profile optimization
- NAP consistency (Name, Address, Phone Number)
- Customer reviews and ratings
- Hyperlocal keywords
- AI search optimization
- E-E-A-T signals (Experience, Expertise, Authoritativeness, and Trustworthiness)
The objective was to determine which strategies are most effective for businesses operating in Medan’s urban environment and how those strategies align with emerging AI-driven search technologies.
Key Findings
The study identified three major factors that significantly influence local search visibility.
1. Fresh Reviews Outperform Large Numbers of Old Reviews
One of the most important discoveries was the growing importance of review freshness.
Businesses that receive approximately 20 new customer reviews within a 30-day period often outperform businesses that have accumulated hundreds of older reviews but show little recent activity.
The researchers found that active engagement also matters. Business owners who respond consistently to customer feedback—particularly negative reviews—can improve click-through rates by an estimated 10 to 15 percent.
This suggests that customer interaction is becoming a stronger ranking signal than simply maintaining a high overall rating.
2. Hyperlocal Content Drives Visibility
The study also found that highly localized content significantly improves search performance.
For example, businesses using neighborhood-specific phrases such as “AC repair in Medan Petisah” tend to achieve better visibility than businesses using broader terms such as “AC repair in Medan.”
Hyperlocal keywords help search engines understand geographic relevance more precisely. They also align with how consumers increasingly search for nearby services.
The researchers emphasized that references to local landmarks, districts, communities, and cultural contexts can strengthen search relevance and improve visibility in both traditional and AI-generated search results.
3. Credibility Signals Are Becoming Essential
The transition toward AI-powered search is increasing the importance of trust signals.
Businesses that upload authentic, geo-tagged photos and provide personalized responses to customer inquiries demonstrate greater authority than businesses relying on generic stock images.
The study found that AI systems increasingly value evidence of real-world experience and customer interaction. As a result, businesses that actively showcase their operations, staff, and customer experiences are more likely to gain visibility in AI-generated search summaries and recommendations.
Implications for Businesses and Policymakers
The findings suggest that Local SEO is evolving from a one-time optimization task into an ongoing process of digital engagement.
Rather than focusing solely on creating a Google Business Profile, MSMEs must maintain consistent activity through review management, content updates, customer interactions, and location-specific content creation.
The researchers argue that successful businesses should prioritize three strategic pillars:
- Dynamic customer interaction and review management
- Hyperlocal content development
- Structured business data that can be easily interpreted by AI systems
The study also recommends that government agencies supporting MSMEs provide advanced training programs focused on online reputation management and AI-era digital marketing rather than basic business profile registration alone.
Such initiatives could help small businesses remain competitive as AI becomes increasingly influential in determining online visibility.
Researchers Emphasize Sustainable Digital Activity
According to the authors, the future of Local SEO lies in sustained engagement rather than static optimization.
The research team concluded that Medan’s MSMEs must transition from simply maintaining an online presence to creating continuous digital activity that demonstrates relevance, credibility, and customer trust.
The authors, representing Universitas IBBI, Sekolah Tinggi Ilmu Manajemen Sukma, and STMIK Logika, argue that businesses capable of generating authentic customer interactions and maintaining accurate business information across multiple digital platforms will be best positioned to benefit from AI-driven search ecosystems.
Author Profiles
May Handri — Researcher and academic affiliated with Universitas IBBI, specializing in digital business strategy and MSME development.
Jam’an Amadi — Lecturer and researcher at Universitas IBBI with expertise in management and business innovation.
Fajrillah, M.Kom. — Corresponding author from Universitas IBBI whose research focuses on digital transformation, information systems, and emerging technologies.
Zuhri — Academic at Sekolah Tinggi Ilmu Manajemen Sukma specializing in business management and organizational development.
Ari Lestari — Lecturer and researcher at STMIK Logika with expertise in information technology and digital systems.
Source
Article Title: Optimizing Local SEO Strategies for MSMEs in the AI Era: A Medan Case Study
Journal: International Journal of Global Sustainable Research (IJGSR)
Publication Year: 2026
0 Komentar