AEO for Local Businesses: Getting Cited in AI Search Results

Local AEO (AI Engine Optimization) is the practice of optimizing your local business's online presence so that AI search engines — ChatGPT, Perplexity, Google AI Overviews, and others — cite, recommend, and surface your business when users ask location-based questions. If someone asks an AI "What is the best Italian restaurant in the West Village?" or "Find me a reliable plumber in Denver," local AEO is what determines whether your business appears in that answer or gets passed over for a competitor. Unlike traditional local SEO, which optimizes for Google Maps and the local pack, local AEO focuses on the signals that AI models specifically use to evaluate, trust, and recommend local businesses in conversational responses.

Why Local Businesses Need AEO Now

The way people find local businesses is undergoing a fundamental shift. According to research from BrightLocal, 87% of consumers used Google to evaluate local businesses in 2024. But a growing share of those queries are moving to AI-powered tools. Gartner predicts that by 2026, traditional search engine volume will drop 25% as users migrate to AI chatbots and virtual agents. For local businesses, this means that the "near me" Google search that drives foot traffic today is increasingly being replaced by conversational AI queries.

When someone types "best coffee shop near me" into Google, they get a map pack with pins, reviews, and distances. But when someone asks ChatGPT "Where should I get coffee in the Mission District?" the AI does not show a map — it gives a curated, opinionated answer naming specific businesses. That answer is based on the information the AI has been trained on and can access through web browsing: your website content, your reviews, your structured data, your presence across directories, and how authoritative your business appears across the web.

The businesses that AI recommends are not necessarily the ones with the biggest Google Ads budgets or the most aggressive SEO strategies. They are the ones with the clearest, most consistent, most accessible information across every signal that AI engines evaluate. That is what local AEO gives you — the ability to control and optimize those signals before your competitors do.

How AI Engines Handle Local Business Queries

Understanding how AI engines process local queries is essential for optimizing your presence. When someone asks ChatGPT "best pizza in Brooklyn" or Perplexity "find a good dentist near downtown Austin," the AI goes through a multi-step process that is fundamentally different from how Google's local search works.

Step 1: Query Understanding

The AI first parses the query to identify the intent (local recommendation), the category (pizza, dentist, plumber), and the location (Brooklyn, downtown Austin). Unlike Google, which uses your GPS coordinates, AI chatbots often rely on the location context you provide in your prompt — or they may ask you to clarify.

Step 2: Source Retrieval

The AI then searches its training data and, for models with web browsing capability, performs real-time web searches. It pulls information from multiple sources:

• Your website — Content, schema markup, meta descriptions, headings, and FAQ sections
• Google Business Profile — Business information, reviews, photos, and Q&A
• Review platforms — Yelp, TripAdvisor, industry-specific review sites
• Directory listings — Yellow Pages, Better Business Bureau, chamber of commerce, niche directories
• Social media — Instagram, Facebook, X/Twitter presence and engagement
• Local press and blogs — Mentions in local publications, neighborhood guides, and food blogs

Step 3: Evaluation and Ranking

The AI evaluates each potential business based on relevance, authority, and data quality. Businesses with consistent information across sources, strong reviews, comprehensive structured data, and authoritative mentions get prioritized. Businesses with conflicting information (different phone numbers across directories, outdated hours on their website, no schema markup) get deprioritized or excluded entirely.

Step 4: Response Generation

Finally, the AI generates a natural language response that names specific businesses, often with brief explanations of why each one is recommended. Unlike Google's local pack which shows 3 results, AI responses might name 3 to 7 businesses depending on the query. The AI may cite specific details from your website or reviews — "known for their hand-tossed sourdough crust" or "patients consistently praise the short wait times" — making the quality of your content and reviews directly visible in the recommendation.

The Local AEO Framework: 6 Pillars

This framework covers the six core areas that determine whether AI engines will discover, trust, and recommend your local business. Each pillar reinforces the others — a weakness in any one area can limit the impact of your strengths in others.

Pillar 1: Structured Data (LocalBusiness Schema)

Structured data is the most direct way to communicate your business information to AI engines in a format they can parse instantly and accurately. For local businesses, this means implementing LocalBusiness schema markup (or a more specific subtype like Restaurant, Dentist, Plumber, or LegalService) with all relevant properties.

The essential LocalBusiness schema properties for AI visibility include:

• @type — Use the most specific subtype available (Restaurant, Dentist, Plumber, etc.)
• name — Your exact business name as it appears everywhere
• address — Full PostalAddress with street, city, state, zip, and country
• geo — GeoCoordinates with precise latitude and longitude
• telephone — Your primary business phone number
• openingHoursSpecification — Detailed hours for each day of the week
• priceRange — Dollar sign notation ($, $$, $$$, $$$$) for quick reference
• areaServed — The geographic area you serve (critical for service-area businesses)
• hasMap — Link to your Google Maps listing
• sameAs — Links to all your social profiles and directory listings

Sites with comprehensive LocalBusiness schema consistently score 15 to 25 points higher on AEO audits than sites without it. This is often the single highest-impact improvement a local business can make.

Pillar 2: Review Ecosystem

Reviews are one of the most powerful signals AI engines use when generating local recommendations. When AI evaluates whether to recommend your business, it considers four dimensions of your review profile:

• Volume — More reviews signal more customer validation. AI engines prefer businesses with 50+ reviews over those with 5.
• Rating — Average ratings matter, but AI is sophisticated enough to weigh context. A 4.5-star rating from 500 reviews often outweighs a 5.0 from 12 reviews.
• Recency — Recent reviews indicate an active, current business. AI engines heavily discount businesses whose most recent review is months old.
• Platform diversity — Reviews across Google, Yelp, and industry-specific platforms (Healthgrades for doctors, Avvo for lawyers, Houzz for contractors) give AI more data points and increase confidence.

Your review response strategy also matters. Businesses that respond to reviews — especially negative ones — demonstrate active engagement. AI engines can and do parse review responses when evaluating business quality. A thoughtful, professional response to a negative review can actually be a net positive signal.

Action items: Systematize your review collection. Send follow-up emails or texts after service asking for reviews. Rotate between platforms — this week ask customers to review on Google, next week on Yelp. Respond to every review within 48 hours. Never purchase fake reviews — AI engines are increasingly capable of detecting review patterns that suggest manipulation.

Pillar 3: Directory Consistency (NAP)

NAP stands for Name, Address, and Phone number — the three core data points that AI engines use to identify and verify your business. When your NAP is consistent across every directory, review site, and social profile on the web, AI engines have high confidence that the information is accurate. When there are discrepancies — an old phone number on Yelp, a different suite number on the Better Business Bureau, a slightly different business name on Yellow Pages — that confidence drops.

The problem compounds because AI engines aggregate data from multiple sources. If three out of five sources say your phone number is 555-1234 and two say 555-5678, the AI cannot be sure which is correct and may either present the wrong number or simply not recommend you at all.

The NAP consistency checklist:

• Google Business Profile — Your primary listing; ensure it is fully complete and verified
• Yelp — Claim your listing if you have not already
• Apple Maps (via Apple Business Connect) — Often overlooked but used by Siri
• Bing Places — Powers Microsoft Copilot's local recommendations
• Facebook Business Page — Keep hours, address, and phone current
• Industry-specific directories — Healthgrades, Avvo, Houzz, TripAdvisor, OpenTable, etc.
• Better Business Bureau — Adds a trust signal
• Local chamber of commerce — Adds local authority
• Data aggregators (Foursquare, Data.com) — These feed many smaller directories

Aim for consistent NAP across at least 30 to 50 directories. Tools like BrightLocal, Moz Local, and Yext can automate this process and alert you to inconsistencies, though manual verification of your top 10 listings is still recommended quarterly.

Pillar 4: Local Content Strategy

Your website content is what AI engines parse most deeply when deciding whether to recommend your business. For local AEO, generic content is not enough — you need content that demonstrates genuine local expertise and relevance. Here are the key content types:

Neighborhood and Area Guides

Create content about the neighborhoods and areas you serve. A restaurant in Brooklyn might write about the Williamsburg food scene. A dentist in Austin might create a guide to healthcare in the East Side. This type of content signals to AI engines that you are genuinely embedded in the local community, not just a business with a local address.

Local FAQ Pages

Build FAQ pages that answer the specific questions local customers ask. "How much does a roof repair cost in Phoenix?" "What should I look for in a Brooklyn daycare?" "Is parking available at your downtown Denver location?" These questions match the exact phrasing people use when querying AI engines, making your content a natural fit for AI-generated answers. Pair these with FAQPage schema for maximum impact.

Service Area Pages

If you serve multiple neighborhoods, cities, or regions, create dedicated pages for each service area. A plumber who serves the greater Phoenix area should have individual pages for Scottsdale, Tempe, Mesa, Chandler, and Gilbert — each with unique, locally relevant content. Avoid thin pages that just swap city names. AI engines can detect templated content and deprioritize it. Each page should include local landmarks, area-specific pricing context, and testimonials from customers in that area.

Local Case Studies and Success Stories

Document your work in the community. A contractor can showcase a kitchen remodel in a specific neighborhood. A law firm can describe (with permission) how they helped a local business resolve a zoning issue. These stories build authority and give AI engines rich, specific content to reference when generating recommendations.

Pillar 5: Technical Access for AI Crawlers

AI engines can only recommend your business if their crawlers can access and parse your website. Many local business websites unintentionally block AI crawlers or make their content difficult to extract. Here is what you need to verify:

robots.txt Configuration

Check your robots.txt file to ensure you are not blocking AI crawlers. Key user agents to allow include:

• GPTBot — OpenAI's crawler (powers ChatGPT)
• PerplexityBot — Perplexity's web crawler
• ClaudeBot — Anthropic's crawler
• Googlebot — Already allowed by most sites; powers AI Overviews

Many website builders and CMS platforms block these bots by default. Check your robots.txt at yourdomain.com/robots.txt and verify that none of these user agents are disallowed.

llms.txt File

The llms.txt file is an emerging standard that helps AI engines quickly understand your website's purpose and structure. Think of it as a welcome mat for AI crawlers. For a local business, your llms.txt should describe what your business does, where you are located, what areas you serve, and what pages contain your most important information.

XML Sitemap

Maintain an up-to-date XML sitemap that includes all your important pages — service pages, location pages, FAQ pages, and blog content. Submit it through Google Search Console and Bing Webmaster Tools. AI engines with web browsing capability use sitemaps to discover and prioritize pages for crawling.

Page Speed and Mobile Responsiveness

While AI crawlers do not "experience" slow pages the way users do, slow-loading sites are often poorly indexed and may time out during crawling. Ensure your site loads in under 3 seconds and is fully responsive on mobile devices. Google's Core Web Vitals are a good proxy for overall technical health.

Pillar 6: Authority Signals

Authority signals tell AI engines that your business is established, trusted, and genuinely part of the local community. These signals go beyond reviews and directory listings to encompass your broader reputation online.

Local Backlinks

Links from local news sites, community organizations, local bloggers, and neighborhood associations carry significant weight. A link from your city's newspaper or the local chamber of commerce website is a strong signal that your business is established and trusted in the area. These links are also the hardest for competitors to replicate, making them a durable competitive advantage.

Local Press Mentions

Being mentioned in local publications — even without a link — builds your entity profile. AI engines can recognize that a mention of "Martinez Family Dentistry on Oak Street" in the Austin Chronicle refers to the same entity as your Google Business Profile. Pursue local PR opportunities: contribute expert quotes to local reporters, sponsor community events, or participate in "best of" polls and awards.

Community Involvement

Sponsoring local events, participating in community programs, and partnering with other local businesses generates online mentions and backlinks naturally. When a Little League team lists your business as a sponsor on their website, or a food festival mentions you as a participating vendor, these signals reinforce your local authority to AI engines.

Social Proof and Engagement

Active social media profiles with genuine local engagement — posting about community events, responding to local customers, sharing local content — add to your authority profile. AI engines parse social media data and use it as a signal of business activity and community relevance. A dormant social profile is a missed opportunity.

LocalBusiness Schema Template

Here is a comprehensive LocalBusiness schema template you can customize for your business. This includes all the properties that AI engines prioritize when evaluating local businesses. Copy this template, replace the placeholder values with your actual business information, and add it to your website's homepage in a <script type="application/ld+json"> tag. For more on implementing schema, see our complete schema markup guide.

{
  "@context": "https://schema.org",
  "@type": "LocalBusiness",
  "@id": "https://www.yourbusiness.com/#localbusiness",
  "name": "Your Business Name",
  "description": "A brief description of your business, services, and what makes you unique.",
  "url": "https://www.yourbusiness.com",
  "telephone": "+1-555-123-4567",
  "email": "hello@yourbusiness.com",
  "priceRange": "$$",
  "image": "https://www.yourbusiness.com/images/storefront.jpg",
  "logo": {
    "@type": "ImageObject",
    "url": "https://www.yourbusiness.com/logo.png",
    "width": 600,
    "height": 60
  },
  "address": {
    "@type": "PostalAddress",
    "streetAddress": "123 Main Street, Suite 100",
    "addressLocality": "Austin",
    "addressRegion": "TX",
    "postalCode": "78701",
    "addressCountry": "US"
  },
  "geo": {
    "@type": "GeoCoordinates",
    "latitude": 30.2672,
    "longitude": -97.7431
  },
  "hasMap": "https://maps.google.com/?cid=YOUR_GOOGLE_MAPS_CID",
  "openingHoursSpecification": [
    {
      "@type": "OpeningHoursSpecification",
      "dayOfWeek": ["Monday", "Tuesday", "Wednesday", "Thursday", "Friday"],
      "opens": "09:00",
      "closes": "18:00"
    },
    {
      "@type": "OpeningHoursSpecification",
      "dayOfWeek": "Saturday",
      "opens": "10:00",
      "closes": "16:00"
    }
  ],
  "areaServed": [
    {
      "@type": "City",
      "name": "Austin",
      "sameAs": "https://en.wikipedia.org/wiki/Austin,_Texas"
    },
    {
      "@type": "City",
      "name": "Round Rock"
    }
  ],
  "sameAs": [
    "https://www.facebook.com/yourbusiness",
    "https://www.instagram.com/yourbusiness",
    "https://www.yelp.com/biz/yourbusiness-austin",
    "https://www.linkedin.com/company/yourbusiness"
  ],
  "aggregateRating": {
    "@type": "AggregateRating",
    "ratingValue": "4.8",
    "bestRating": "5",
    "ratingCount": "247"
  }
}

Important: Replace LocalBusiness with the most specific subtype that applies to your business. Schema.org offers dozens of LocalBusiness subtypes including Restaurant, Dentist, Plumber, LegalService, RealEstateAgent, AutoRepair, HealthClub, BeautySalon, and many more. Using the specific subtype gives AI engines more context about what you do.

Use our free schema generator to build your LocalBusiness schema without writing any code.

Industry-Specific Local AEO Tips

While the 6-pillar framework applies to every local business, certain industries have unique AEO considerations. Here are targeted tips for the most common local business categories.

Restaurants and Food Service

Restaurants are among the most frequently queried local business categories on AI engines. When someone asks "best Thai food in my neighborhood," AI engines look for:

• Menu schema — Use the Menu and MenuItem schema types to make your offerings machine-readable. AI can then answer questions like "where can I get pad thai near me?" by matching specific menu items.
• Cuisine type — Include the servesCuisine property in your schema (e.g., "Thai", "Italian", "Mexican").
• Dietary options — If you offer vegan, gluten-free, or halal options, make this explicit in both your content and schema. AI queries increasingly specify dietary requirements.
• Reservation links — Include acceptsReservations and link to your OpenTable, Resy, or direct booking page.

Healthcare Providers

Healthcare is a trust-critical category where AI engines are especially careful about recommendations. Key AEO priorities:

• Physician schema — Use the Physician type with medicalSpecialty, available service, and credential properties.
• Accepted insurance — List insurance providers on your site and in structured data. "Does Dr. Smith accept Blue Cross?" is a common AI query.
• Healthgrades and Vitals profiles — These are heavily weighted review platforms for healthcare. Claim and optimize your profiles.
• Patient education content — Create condition-specific FAQ pages. "What should I expect during a root canal?" is exactly the type of question patients ask AI engines.

Home Services (Plumbers, Electricians, HVAC, Contractors)

Home service businesses are frequently sought through AI queries, often in urgent situations. Your AEO strategy should emphasize:

• Service area coverage — Be explicit about every city, neighborhood, and zip code you serve. Create dedicated service area pages for each.
• Emergency availability — If you offer 24/7 or emergency services, make this prominent in your schema (openingHoursSpecification) and content.
• Pricing transparency — Include typical price ranges for common services. AI queries often include cost: "how much does a water heater installation cost in Phoenix?"
• License and certification information — Include your license numbers and certifications. AI engines use this as a trust signal, especially for regulated trades.

Legal Services

Legal services require high trust signals due to the stakes involved. For law firms and attorneys:

• Attorney schema — Use the Attorney type with practiceArea, areaServed, and credentials.
• Practice area pages — Create dedicated pages for each practice area with FAQ sections. "Do I need a lawyer for a DUI in Texas?" is a real AI query.
• Avvo and Martindale profiles — These legal-specific directories carry significant weight in AI evaluations of attorney authority.
• Client testimonials — With client permission, share specific outcomes. AI engines can use these as evidence of competence in specific areas.

Real Estate

Real estate queries on AI engines are growing rapidly. Key considerations:

• RealEstateAgent schema — Include areaServed with specific neighborhoods and communities.
• Market expertise content — Publish neighborhood guides, market reports, and local buyer or seller guides. "Is it a good time to buy in East Nashville?" is a question AI is asked regularly.
• Zillow, Realtor.com, and Redfin profiles — Keep your agent profiles updated with recent transactions, reviews, and accurate contact information.
• Transaction history — Sharing recent sales data (where appropriate) signals active market presence and local expertise.

Free Tools to Get Started with Local AEO

You do not need a big budget to start optimizing for local AI search. Here are free tools — including tools we have built specifically for AEO — that can help you assess and improve your local AI visibility today:

• Vida AEO Audit — Run a free AI readiness audit on your website. Checks your schema markup, content structure, technical access, and 31 other AEO scoring factors. Takes 30 seconds.
• Schema Generator — Build LocalBusiness, Organization, and other schema types without writing code. Just fill in your business details and copy the generated JSON-LD.
• FAQ Schema Generator — Create FAQPage schema for your local FAQ content. Generates both the visible HTML and the JSON-LD schema.
• Google Rich Results Test — Validate your schema markup and check for errors. Enter your URL and see exactly what structured data Google detects.
• Google Business Profile — If you have not claimed and fully optimized your Google Business Profile, do this first. It is free and is one of the most influential sources AI engines use for local data.