NO DOUBLE DIP EXPECTED: SMALL AND MEDIUM BUSINESSES ARE OPTIMISTIC ABOUT 2012 DESPITE TEPID ECONOMY
With Trust in Vendors Low, Relationships Can Be Rebuilt by Providing Sound Business Management Advice, Survey Finds
CAMBRIDGE, MA, Nov. 16, 2011 – Small and medium businesses (SMBs) are moving from survival to growth mode, leaving their vendors with the task of rebuilding trust lost during the recession, according to a new study released today by Bredin.
Bredin surveyed 300 principals of U.S.-based SMBs about their business outlook for 2012, how they want to engage online with their vendors, their business concerns and purchase criteria, and their level of trust in the different kinds of companies they do business with – from banks to technology providers.
"SMBs have low trust in banks and other big businesses for a whole host of reasons including cost increases, service cutbacks and the recession in general," said Bredin CEO Stu Richards. "One way vendors can regain that trust is to help SMBs grow their businesses by providing business management advice and resources."
Key results of the research include:
- Economic outlook: SMBs are surprisingly optimistic about their business prospects in the "new normal" economy. Three in five (60%) expect 2011 sales to increase versus 2010; even more – almost two in three (64%) – expect sales to increase in 2012.
- Business concerns: "Finding new customers" remains the top business concern, followed by "Dealing with competition" and "Managing costs." In a sign of increased business activity, "Retaining talented employees" jumped from the lowest-rated business concern in 2010 to seventh out of 10 in 2011. Likewise, SMBs are less concerned with "Having enough money to pay our bills" than they were in 2010.
- Marketing tactics: SMBs continue to struggle with online marketing. 55% rate their own website as an effective or very effective way to find new customers, followed by search marketing (36%) and email newsletters (34%). Social media rate relatively low; only 20% rated Facebook an effective way to find new customers, followed by Groupon (15%), LinkedIn (14%), Twitter (13%) a blog (11%), and location-based services like FourSquare (9%).
- Media preferences: When looking online for information on products and services for their businesses, SMBs use search first (69%), followed by reviewing educational resource centers (53%), reading email newsletters (45%) and watching webcasts (44%). Offline, SMBs prefer to learn about products and services for their business through trade shows (60%), newspaper and magazine articles (56%) and direct mail (40%).
- Business management advice: SMBs spend significant time looking for business management advice; 40% look for these resources often or very often. They are most interested in industry news, technology and sales and marketing; they prefer to learn via articles (58%), peer forums (45%), and case studies (40%). After trade association websites (50%), SMBs look to their vendors most (43%) for business management advice, more than they do from media/publishers (36%), government / non-profit sites (25%), and universities (16%). Among vendors, SMBs prefer business management advice most from their CPA (60%), their bank (37%), and their technology hardware vendor (35%).
- Value of content as a marketing tool: Providing business management advice to SMB site visitors can increase traffic, trust and transactions. 39% of SMBs are more likely to visit a vendor's site if it has business management advice; 41% are more likely think favorably of that vendor; and 32% are more likely to buy from that vendor.
- Trust. The effect of the financial crisis lingers with SMBs, with 63% saying their opinion of the banking industry is worse as a result of the crisis (up from 58% in 2010) and 43% saying their opinion of their own bank is worse (up from 33%). SMBs trust their CPAs (80% trust their CPAs a lot or very much) more than any other group surveyed, including overnight package delivery services (56%), other small businesses (45%), and payroll service providers (42%). Least trusted? Not banks (29%), but employee recruiting sites / temp agencies (14%).
About the Study
Marketing to SMBs in 2012 is based on an online survey of 300 principals of U.S.-based businesses with 500 or fewer employees, in a wide range of industries. The objective of the survey was to better understand SMBs' marketing preferences and business concerns. The survey was fielded in October 2011 and has a margin of error of +/- 5%.
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Bredin has been helping leading companies develop profitable, long-term relationships with SMBs since 1991. Bredin helps clients understand SMB needs and concerns through original market research, and helps clients achieve their revenue goals through impactful acquisition and retention programs.