Technology, Services Continue to Empower Small and Medium Businesses
By Bryan Yeager on May 15th, 2012
The Web has helped level the playing field for small and medium businesses to market and compete, especially as these companies continue to shift their spend and efforts to digital marketing. While targeted, automated e-mail marketing may have been out-of-reach for SMBs five years ago, it is one of the most-used marketing tactics by companies with fewer than 500 employees today. Mobile might have not made sense for most SMBs a few years ago, but it is now a growing part of the SMB marketing mix. Further, while a social media presence was experimental just two three years ago, it is now a necessary part of small and medium businesses’ marketing strategy, just as it is for enterprise marketers. Also like enterprise marketers, SMBs face challenges managing these different channels in an effective way, as well as keeping up with the lightning-fast face of evolution in digital marketing.
While these challenges persist, technology and service providers are devising solutions specifically targeted at SMBs to help them get a hold of their marketing efforts. With virtually limitless storage, widespread broadband availability, and robust capabilities delivered via a browser, similar tools that big brands use to manage and optimize their marketing efforts are available for SMBs at a fraction of the cost, enabling these companies to more effectively meet their marketing goals. InfoTrends recognized this trend when it first studied small and medium businesses’ marketing approaches in 2009. At the end of 2011, we conducted a follow-up study entitled Capturing the SMB Marketing Automation Opportunity to understand how SMBs’ marketing spend, strategy, and tactics are evolving by surveying over 2,000 small and medium businesses across 13 vertical industries.
One of the most striking developments over the past two years is the growth in the use of social media for marketing. Overall use has increased dramatically: in 2009, over half of respondents did not have any social media presence, but in 2011, just 3% reported not having a social media presence. Facebook was the most popular social network for marketing according to SMBs from our 2009 study, with 32% of use. In 2011, Facebook is table-stakes for SMBs: 90% of respondents reported having a Facebook presence in our most recent study. The use of LinkedIn and Twitter also grew substantially, from 19% and 17% in 2009 to 46% and 43% in 2011, respectively. As use has grown, so has budget allocation for social media initiatives; social media comprised almost 9% of SMBs’ marketing spend in 2011.
While social media is proliferating among small and medium businesses, they continue to face the same challenges they did two years ago: constrained resources related to cost, time, and skills. In fact, these issues were more pronounced in our 2011 study than they were in 2009, especially as it relates to understanding new marketing channels and having the skills to address them. SMBs report having a preference for managing all marketing channels through a centralized technology solution or centralized service provider. Whatever the choice, agility is key; as new channels or networks emerge, solutions or providers need to quickly adapt by providing capabilities and education to help their users be successful.
The SMB user is an important audience for a number of prominent companies today:
- Intuit has a long legacy of delivering products and services to small and medium businesses through its QuickBooks accounting software, website services, and payment services. Last month, it acquired vertically-focused SMB technology provider Demandforce for over $400 million. Demandforce gives Intuit robust technology that helps small and medium businesses manage their social media presence and automate marketing across multiple channels, addressing some of the key challenges SMBs face.
- Recently, Yahoo! launched its Marketing Dashboard toolset for small local businesses with features that help companies monitor and manage their online reputation and analyze traffic from websites and campaigns. Yahoo! has built a fairly successful offering for SMBs with its website hosting and eCommerce offerings, and its Marketing Dashboard makes its existing package a much more attractive offering for SMBs looking for a one-stop-shop.
- With Adobe’s recent release of Creative Suite 6 and the Creative Cloud, the company also launched subscription-based pricing plans starting at $50 per month to access the entire collection of applications instead of paying a large upgrade fee every 6 to 12 months. While it is yet to be proven in the market, this low-cost pricing model could open up Adobe’s tools to a much broader audience, including many SMBs. While almost 40% of SMBs in our 2011 study reported owning Photoshop, only 21% owned Illustrator and 17% owned InDesign. It will be interesting to see if this new plan spurs adoption among SMBs.
The SMB marketing mix is diversifying, exacerbating the challenges that already face resource-strained businesses. In response, technology and service providers are empowering small and medium businesses with solutions that can help them become more efficient and effective with their marketing and communication efforts. As marketing dollars continue to flow to digital channels from organizations of all sizes, SMBs can harness the same tools their larger counterparts can, allowing them to engage with audiences they would have never been able to reach just a few years ago.