Is it possible to advertise online with large sites like Facebook and Google to a specific area?

[Jake]

To add, most advertising networks offer Geo Targeting based on the visitor's IP address, which really identifies the locating of their internet providers office/connection point, it's not as accurate as zip codes, typical Google Adwords allows you to specify a radius around a selected point.
Facebook and similarly the dating site Plenty of Fish use member registration information allowing you to name the city you want to target plus any other cities within a certain radius, based on member registration information, they also offer demographic targeting based on registration info, this can be quite powerful, you can setup a facebook ad just to get statistics in advance as to how many engaged women between 18 and 34 live within 10 miles of your city.
Premium paid advertising is expensive due to competitive bidding, to have a chance of being profitable careful optimization of advertising copy, leywordselection and the landing sales-page is needed.