Social Media Marketing Growing Among Businesses: Report
Opportunities exist for vendors to educate small businesses on social media marketing benefits, an AMI study concludes.
Social media marketing is growing among small businesses (SBs) in the United States, but true breakout growth in this category is being challenged by SB owner inertia, according to a report by IT research firm AMI-Partners. In the study, "2010 U.S. Small Business Marketing Activity and Spending Study: Where and How U.S. Small Businesses Are Spending Marketing Dollars," marketing program decisions are largely driven by business decision makers, such as owners, who are also responsible for managing many other aspects of their businesses.
The report noted that this responsibility limits the amount of time they can devote to exploring and engaging social media. Consequently, a majority of U.S. SB marketing activities are likely to be on an automatic renewal cycle, benefiting traditional vehicles such as printed telephone directories, AMI analysts concluded. The firm predicted that the effects of the recent economic downturn would lead to an acceleration of U.S. SB social media marketing adoption in the near term.
"Overall, these SBs' marketing activity in 2010 was down in comparison to levels in 2007," said Don Best, vice president at AMI-Partners in New York. "The greatest declines were in print, broadcast and outdoor media advertising; conversely, online media experienced [some increases]."
Best said while a significant number of U.S. SBs are finding value in online media advertising, factors such as variable costs, lack of understanding and the need for proactive management act as hindrances to widespread adoption. At the same time, however, he said more U.S. SB decision makers are expressing high interest in social media marketing: The minimal cost of social media marketing has emboldened some U.S. SBs to experiment with this medium.
"As the popularity of search and social sites continues to [grow] among their customers," said Best. "AMI expects U.S. SBs to become much more strategic concerning their online marketing activities, including social media. Given the 6.3 million SBs that currently exist in the U.S., this presents significant opportunities for vendors that can offer these SB decision makers tools to better utilize the Web for marketing."
The report includes SB marketing activities and spending analyses, usage (current and planned) and preferences for traditional (e.g., direct mail) vs. new media (search engines, Facebook, Twitter, etc.), as well as current and planned spending on more than 20 marketing vehicles, the importance of Internet/online media in advertising and promotional mix and analysis of marketing activities and spending based on "firmographics" such as the number of employees, verticals and other attributes.
The report also covers how SB marketing spending will evolve in the future, how such spending changed between 2007 and 2010, predictions of how marketing activities will continue to evolve, identification and analyses of top small business marketing vehicles in the future, and an opportunity analysis that provides guidance about where and how IT manufacturers and service providers can help address the growing needs of small businesses.
AMI's survey also provides an analysis of the marketing mix used by U.S. SBs, including more than 20 marketing channels with specific spending information for each. In addition, the study identifies trends around social media marketing and e-commerce activity. The overall market-sizing data in this report was determined through an extrapolation of survey finds, secondary research information and AMI-Partners' proprietary SMB global model and the U.S. small business marketing forecast model.