(Originally posted 7/12/2015)
In the last posting, I offered some of Borrell Research’s 2015 SMB study results. Some interesting, and maybe not so surprising, results showed that small and mid-sized businesses are looking to increase their digital focus in 2015, as a continuation of the ongoing trend for several years. Exactly where is that focus going to be placed, according to these businesses? Here’s 5 directions that we now see coming out of the work that Borrell Research has accomplished.
1) How many $$’s do the average SMB’s devote to marketing?
Small to mid-sized businesses don’t have dollars to toss around. That’s not a critique, it’s just a fact. Every large business started as a small business at one time, budgets are all relative. In Borrell’s study that included more than 7200 businesses interviewed of all shapes and sizes, one-quarter of the respondents said they intend to spend less than $5000. That works out to a monthly budget of under $400 for those businesses. Try to spread that out amongst all the advertising sales contenders that these businesses have to deal with and you see the importance of a strong presentation if you are one of those contenders.
Overall, the average marketing spend for these SMB’s came to 6% of gross revenues. This is an average and is not meant to be the “target” for all businesses, but it does provide a benchmark. And it’s important to remember that this figure includes ALL marketing efforts, whether or not they are directly related to media. So that includes sponsorships, signs, business cards, etc.
2) Everybody is advertising on Facebook…well, not so fast.
No, everyone is not advertising on Facebook. In fact slightly less than 1/3 of the businesses surveyed claimed to have conducted any paid advertising on FB in the past year. So does that mean that Facebook is a mirage? NO! It means that FB is growing. Frankly 75% of all those that have advertised on FB are at lease somewhat satisfied with the results. In addition, Facebook is constantly changing and trying to improve. In fact, earlier this year, FB reported a 46% increase in advertising revenue. So expect, sooner than later, that a majority of local businesses will be paying for Facebook advertising. The trick is, how to do it right. That’s what experts are for.
3) Everybody advertises on Google…not so fast.
No, everyone does not advertiser on Google. In fact according to the Borrell SMB survey, just a little over 20% of small to mid-sized businesses claimed to have advertise on Google in the past year. Does that surprise you? The univerfe of small to mid-sized businesses is huge, a number of them less than 10 employees. They need help and guidance too. SMB’s remain a very under-serviced sector by marketing firms. It’s where much of the growth is going to be in the coming years. And for Google, they have much more than the predominant pay-per-click, or SEM that tends to confuse and confound a number of people. Google’s network of display advertising opportunities, sophisticated targeting and regarding provide options for large and small advertisers. Google is well beyond being a search engine company.
4) Not all marketing is advertising.
More and more, small business is recognizing the value of a marketing “mix.” Whether that means generating new customers from a Groupon offer, or sponsoring the local Little League team, or exhibiting at our local Dogwood Festival here in Fayetteville, it’s all becoming part of the mix. And it’s a larger part than before. Marketing spend devoted to non-advertising is nearly 1/3 of the average SMB’s marketing budget. That is not by chance anymore, it’s part of an overall strategy…because done wisely it works!
5) SMB’s are expecting alot out of social media. Possibly too much?
What is social media supposed to do for a business? Can it bring in new business, while improving engagement with current customers, while at the same time generating incremental sales volume? Maybe social media can, when it’s used properly. The point here is that overall, when a business is posting to its current audience, it’s doing just that…speaking to its current audience. Generating new customers won’t occur unless current customers share posts with their friends, and that meant that the business needs to keep that in mind when posting. If a business is not promoting or boosting their posts to a targeted audience, generating new business is going to be a long uphill climb. Don’t get me wrong, social media is here to stay and its use as a marketng tool is only going to increase. But if a small business wants new customers out of their social media posts, that will require a different social strategy than the one that focuses on engaging current customers. And if you are a social media marketing provider, understanding the customer’s expectations is a primary goal in being a good partner to the SMB.
*Borrell SMB Survey 2015