Study: Small businesses are all about digital
Preliminary data from local media and advertising analysts BIA/Kelsey suggests that small and medium-sized businesses (SMBs) are ramping up their usage of digital and social media, especially in the lead-up to Black Friday, Cyber Monday and the lesser-known Small Business Saturday.
“We're awaiting a full analysis of the data, but we have a hypothesis that growth in raw utilization of digital and online media has slowed, though the depth of utilization and sophistication has increased,” said Steve Marshall, BIA/Kelsey's director of research and consulting.
The data comes from BIA/Kelsey's ongoing tracking survey of SMBs, conducted in conjunction with its research partner ConStat. BIA/Kelsey will conduct a full analysis of the data over the next several weeks and issue a report.
According to the research, 53% of SMBs reported using at least some form of social in their marketing mix. Over the past year, SMBs apportioned roughly 37% of their advertising budgets to beefing up their social media and Web presences and their online performance management. That's a number that could grow, as the SMBs surveyed said they intend to boost their digital and online spending by 3% over the coming year.
While not overly surprising, the preliminary results of the survey are telling, said Marshall.
“To a large degree, we have anticipated this,” he said. “We have seen numerous signs of SMBs embracing digital and online media, but we think SMBs are entering a new phase of much greater sophistication and much broader usage of online capabilities.”
SMBs are also paying more attention to analyzing the sea of data that comes from dipping more deeply into digital and social channels. Half of those surveyed said they “actively analyze the performance of their advertising, including measuring cost-effectiveness,” with 23% saying they plan to start doing this type of analysis in the future.
Sixty-nine percent of SMBs update their online presence at least once a month and 27% pay for “regular assistance” to help them do so. A quarter of those surveyed said they use some kind of Internet service or program to help them monitor and manage their online performance.
Though the marked growth in SMBs' use of digital does “help level the playing field” between them and national brands,” said Marshall, “there is a perpetual game of leapfrog” going on.
“We're also seeing some national retailers and brands become highly sophisticated in their use of online media,” he said. “So there will probably always be a bit of a gap in online capabilities between small businesses and national businesses.”
While there are some older businesses with well-established customer bases that have been slow to move online – “and we don't expect them to embrace online because they're doing okay without it, primarily because of their long-term relationships,” said Marshall – the trend is clearly toward SMBs investing more in their online presences.
“The great majority of SMBs are moving quickly online and feel that it's a competitive necessity,” he said.