It seems that small business are mainly using social media to identify and attract new customers. That is that big take away from the most recent edition of the Small Business Success Index™ (SBSI). This third wave of the report, sponsored by Network Solutions® and the Center for Excellence in Service at the University of Maryland’s Smith School of Business reports social media adoption by small businesses has doubled from 12 percent to 24 percent in the last year.
From the press release, “American small businesses are pushing the limits on new ways to improve efficiency in the prolonged downturn, including a steady increase in social media adoption.”
It goes on to quote Connie Steele, Director at Network Solutions, “Tough market conditions mandate small businesses to think and act creatively to sustain themselves”. “Social media can be the best friend for small business owners who constantly seek new ways to attract new customers and retain the ones they have at a relatively low cost.”
Also from the report, the SBSI found that nearly one out of five small business owners are actively using social media in their business. Small businesses are increasingly investing in social media applications, including blogs, Facebook® and LinkedIn® profiles. The biggest expectation small business owners have from social media is expanding external marketing and engagement, including identifying and attracting new customers, building brand awareness and staying engaged with customers. Sixty-one percent of the respondents indicated that they use social media to identify and attract new customers. Listen to a podcast on how small businesses are leveraging social media for customer engagement at http://bit.ly/JayEhret
“In order to meet the growing challenges of a tough market last year, I was forced to consider alternative options to keep my business visible,” says small business owner, Dr. Alan Glazier, CEO and Founder, Shady Grove Eye and Vision Care. “With a very small investment in social media marketing, I was able to generate new business opportunities. Our Google® ranking is consistently number one for many of the phrases people use to search for eye doctors in and around my city, and we have received a “bump” in terms of new visitors to the site. My blog has been picked up by different news sources and led to media interviews. I am now recognized as a thought leader in social networking within my profession and lastly but most importantly, my marketing budget has been reduced by more than 80 percent.”
Small business owners use social media to attract new customers:
- 75% surveyed have a company page on a social networking site
- 61% use social media for identifying and attracting new customers
- 57% have built a network through a site like LinkedIn
- 45% expect social media to be profitable in the next twelve months
Small business owners still have concerns with social media:
- 50% of small business social media users say it takes more time than expected
- 17% express that social media gives people a chance to criticize their business on the Internet
- Only 6% feel that social media use has hurt the image of the business more than helped it
“Social media levels the playing field for small businesses by helping them deliver customer service,” says Janet Wagner, director of the Center for Excellence in Service at the University of Maryland’s Robert H. Smith School of Business. “Time spent on Twitter®, Facebook® and blogs is an investment in making it easier for small businesses to compete.”
In addition to tracking how small business owners use technology, the SBSI Index measures how they are doing in six key areas of business: capital access, marketing and innovation, workforce, customer service, computer technology and compliance. Other key findings from the December 2009 Small Business Success Index include:
Small businesses experience positive effects from the economic downturn:
- 72% have found ways to operate more efficiently (up significantly from 66% in June)
- 47% have been led to find new products and services that benefit customers
- 43% have become better teams as hard times force people to work together
Building online presence continues to be key focus for small businesses:
- Company Web sites are a top technology investment in the next two years, with small businesses either adding new features/functionality to their existing Web sites or building one from scratch.
- The ability to showcase their products and services online to attract new customers is second in the hierarchy of technology investments small business owners plan to make in the next two years.
- Social media investments rank third in small business investments to be made in the next two years.
Small business owners interested in finding out how your business can start using social media should join us for a Tweet Chat #sbbuzz on Feb 23rd, 8-10PM (EST). Anita Campbell, Editor of Small Business Trends, will moderate the discussion to provide additional insight on how to effectively use social networks to generate results.
To download a copy of the Small Business Success Index and also find out how your business scores on the six key dimensions of small business success, visit www.growsmartbusiness.com.
If you are a casual reader to this blog you have probably heard that on September 29, in Washington, DC, Network Solutions is hosting the Grow Smart Biz Conference.
