My money is on Google Ad words
With the money you are talking about I would put it into advertising on Google adwords, I think you will see better results.
Additionally if you want to concentrate on local business join the chamber of commerce to get your name out. You can get a mailing list of all members included in the price. With this you will probably shell out $200. - $250. then put another $100. a month on Google adwords and you will be a lot better off.
Just my opinion!!
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