This seems to be the $64000 question these days.  Also depending on who you talk to, you can get a variety of answers.  Today I wanted to bring to your attention a number of articles that have written recently that are all interconnected. They are listed in the order you should read them. I found all three articles and the comments associated with them interesting and should help give you an idea on why local SEO is not just adding meta tags or getting listed in Google Places. 🙂

Why Local SEO is Harder Than SEOs Think by Matt McGee. Matt does a nice job going through a local listing and trying to figure out why one listing is not listed higher than another on Google maps.

Local SEO Citations: Response to SBSM by David Pavlicko, sort of takes off where Matt left off and comments on citations in local SEO.

Finally, there is Local Ranking Factors and Core Data Confusion by Mike Belasco, Mike says “Despite all of your other optimization efforts and all of the other ranking factors that we may consider, core data confusion can hurt your ability to rank in Places.  I took this theory and applied it to the listings that Matt McGee recently researched [see above article], using a few simple procedures”