The Wiki page explains its origins, ironically enough, in London:
The term "Northern Soul" emanated from the record shop Soul City in Covent Garden, London, which was run by famous soul music collector Dave Godin. It was first publicly used in Godin's weekly column in Blues & Soul magazine in June 1970. In a 2002 interview with Chris Hunt of Mojo magazine, Godin said he had first come up with the term in 1968, to help employees at Soul City differentiate the more modern funkier sounds from the smoother. Godin referred to the latter's requests as "Northern Soul":
"I had started to notice that northern football fans who were in London to follow their team were coming into the store to buy records, but they weren't interested in the latest developments in the black American chart. I devised the name as a shorthand sales term. It was just to say "if you've got customers from the north, don't waste time playing them records currently in the U.S. black chart, just play them what they like – 'Northern Soul'".