SMBs and Online Marketing

The gist of the article is that use of online tactics by SMBs has increased tremendously since 2010, but the effectiveness of these tactics has decreased. For example, 86% have a website in 2011 compared to 52% in 2010, but the reported effectiveness of the company website has gone down from 68% to 64%.

eMarketer explains this phenomenon thus:

A rush of small businesses to new marketing channels can mean that less experienced respondents are now reporting on the effectiveness of their efforts, which would naturally be lower than those who have been using a channel for many years. In addition, some small businesses could be overreaching by trying to tackle too many channels at once, without the necessary time and resources.

However, the article doesn't state a very obvious probable cause of decreased effectiveness: increased competition. If yours is the only bakery in town with a website, or the first salon with a Twitter account, you're much more likely to find those channels more effective than if you are one of all the businesses in town with online channels. Does that mean you're wasting your time "trying to tackle too many channels at once?" Not necessarily. Does it mean you can do without writing a blog post every week. No—it only means that you need to write better blog posts, have a more active presence on Twitter, and engage better with your fans on Facebook. Just having a presence online isn't good enough: you need to market better than your competitors, just like you have to do offline. And if you're not online when your competitors are, you're already way behind in the race. Constant Contact's survey on effectiveness of survey tactics used by SMBs is also reported in this article, and reports higher rates of usage and effectiveness—somewhat expectedly, because Constant Contact's clients are much more likely to be using email marketing and other online tactics. Constant Contact's survey also reports more effectiveness for online channels, including email marketing up on top with 78%, even ahead of websites at 76%.

What's more interesting about Constant Contact's survey is that they compare online tactics such as website, social media and blogs with offline, such as telephone, public relations and print advertising. But ultimately, it all depends on your business.

First, who and where are your customers? Are they savvy smart-phone users? (Have you considered mobile campaigns?) Are they avid coupon-snippers? (Have you tested direct mail?) Do they spend hours on Facebook every day? (Do you have a Facebook page and maybe an ad campaign?)

Second, what are your competitors doing? Are they using channels you haven't tried out yet? Are they being found online when you don't turn up on search results? You don't have to copy everything they do, but you don't want to make it easy for them either.

Affinity Express is also surveying our small business customers to see how they use online tactics for advertising and marketing. We'll be publishing the results soon: stay tuned.

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