According to recent U.S. Census data, 170,000 small businesses closed their doors in the two-year period between 2008 and 2010. However, as the country's economy begins to emerge from recession, small-to-midsize businesses have demonstrated, once again, that their independent nature offers the average big business investor much room for growth. Based upon the results of the 2013 Small Business Saturday campaign, small businesses saw an influx of $5.7 billion in sales, up 4 percent from 2012, proving their power to generate positive business outcomes.
Conducted by the Chief Marketing Officer (CMO) Council and Penton, the "Business Traction from Smarter SMB Interaction: Advancing Enterprise Excellence in SMB Marketing" report explores precisely how today's big brands view the current SMB market. The study, which polled more than 160 senior marketing executives selling to small businesses, reveals that, while big brands are eager to increase SMB investment, gaps in data quality and the residual uncertainty often hinder progress and growth.
The following statistics highlight the opportunities and challenges today's marketers experience within the SMB marketplace, and the imperative need for more information about key drivers in the market:
- While 70 percent of respondents view the SMB market as extremely important to business today, 66 percent plan to increase focus on the market in the coming year. Overall, 87 percent of marketers believe the value of the SMB market will increase over the next three years.
- Forty-seven percent of marketers believe they have good rapport with their SMB customers and that they are growing relationships, while 22 percent say there's strong loyalty based upon high levels of repeat business. However, only 36 percent say that SMB buyers have a reasonably positive view of big business brands.
- Thirty-six percent of brands are looking to improve their SMB-centric experiences, for only 42 percent have dedicated departments or organizations within the company specifically devoted to SMB engagement. Fifty-two percent either have or are developing a committed team.
- Though 56 percent of marketers believe their strategies are somewhat evolved, 14 percent admit that their programs are not very well or not at all evolved. Yet, when it comes to making improvements to continue growing such strategies, 45 percent said they would like to see better integration and use of customer data.
- While 50 percent of marketers polled believe that they have good access to transactional and customer support data, 39 percent only have basic contact details and 21 percent admit that their customer data resides in silos across the organization. Overall, only 8 percent of marketers have a 360-degree view of their SMB customers.
- When it comes to how brands educate themselves about the current SMB market, 43 percent say they've turned to SMB-centered industry webcasts, events, or seminars within the last six months. Thirty-three percent have conferred with their IT, finance, sales, and channel groups, 32 percent have turned to consultants and SMB experts, and 26 percent rely on industry research reports for further SMB information.
- With many big business marketers struggling to create strategies, products, services, and campaigns that incorporate intelligence about the actual customer and market, only 8 percent believe they are co-innovating with their SMB partners extremely well. Forty-one percent admit their failure to embrace their customers.
Key takeaway: First and foremost, as with any client or customer, companies must get to know their audience. Vast amounts of data exist, yet many companies fail to extract richer insight in order to cultivate the understanding necessary to drive value and engagement. By focusing on the intricacies and nuances of the target market, marketers will be better able to reach these relevant segments with critical information in real time. In many cases, companies approach all SMB markets with the same formula and offerings, lacking the intelligence and insight necessary to demonstrate their competence and services. In fact, 61 percent of those polled agree that their customer interactions are in need of improvement, but they simply don't have the proper knowledge to execute segmentation and personalization campaigns. Moving forward, companies must shift away from their reliance on analyst and expert advice, and incorporate direct knowledge from the SMB customer in order to grow programs and practices in accordance with what the market truly requires.