Up to this point there was a very clear distinction between local and organic in the results pages, and also a clear distinction in what was needed to rank well for either. For the most part ranking factors were independent, with the only exception being that a high quality website with mature SEO did seem to hold some influence on local listing rank. e.g. if all the other factors were the same between two local listings, the one with the better website would rank higher.
Following upon that idea, the local/organic, blended/traditional, website/place page dichotomy has changed or been adjusted numerous times throughout the last year.
It is clear, for example, and well recognized among local SEOs, that from the beginning Google would sometimes show traditional results and sometimes show blended results, with it difficult to near impossible to figure out the rhyme or reason behind the differences. In my view, Google also seems to have offered change-ups between the two different results on the same searches over different periods. (For example, one month it has been all blended . . . the next month, all traditional.) I've always read this as purposeful and perhaps as an attempt to continually offer varied top results. Another adjustment has been Google offering organic-only local website results above or within local blended local results.
This latest development though, is an interesting turn.
The Latest Adjustment - Website Data Dominates Locally
I noticed this checking in on clients around the US who formerly had weak results in certain searches when traditional results were shown, but strong rank when blended results were shown. Suddenly, they had the same strong local rank even though a traditional result was being shown.
This biggest example indicating a change, however, was one client in particular who's Google places page had been optimized for some time - including both on-page and off-page factors - but who's website was new and only beginning to be developed.
This client's business falls into about five or six distinct categories, at least four of which are available as choices in the Google places API, and the rest of which are available in off-page directories and as custom categories or keywords. The new website, however, only provides significant content for one. To get the website started I only focused on their most profitable category, expecting to develop the rest over time. The result of this?
As the new website as grown more thoroughly indexed and recognized by Google - and naturally under that single category - the Google places page suddenly dropped 3 pages in rank in every search related to categories not present on the website, while its rank increased a couple spots in searches related to the category I had initially focused on.
What this tells me: if you have "Office Space Rental Agency" optimized both on page and off page in Google places, but don't have matching or supporting content on the associated website . . . . Google isn't going to be giving much weight to that category. Once again this indicated to me that Google is seeking to rely on what it has always done best - indexing and ranking information from websites. Whether this will stick or if this will change remains to be seen. But for now at least the indication is ever increasing importance for the content on the website and traditional SEO.
Luckily, I will be able to test this theory in the coming days and weeks. As I develop optimized website content for this clients other remaining categories . . . we'll see if the rank increases again . . . (and hopefully back to where it was!).
Author's Follow Up: As predicted over the coming months I was able to test my theory and it worked to a tee. So theory confirmed. If you want to rank locally, your website must directly support the effort.