Small Businesses Unprepared for Online Growth: Survey

Respondents had strong concerns over compromises made to keep costs down while trying to build for successes.

Seventy-three percent of SMBs nationwide are unable to handle a 200 percent spike in online traffic without changes to their Website. That's according to findings of a survey by Neustar, a provider of directory and Internet infrastructure solutions. And the number jumps to 93 percent in the case of a 300 percent increase in traffic.

The survey, part of a study conducted in March and April of 2011, indicates just how unprepared SMBs are to cope with rapid business growth, as well as their concerns around keeping technology costs low versus implementing the best option.

The survey also found IT's confidence in the infrastructure's ability to handle increased traffic flow without changes to their current Website wanes as growth accelerates. More than half the respondents, 55 percent, expressed confidence that they can handle a twofold increase in traffic, but only 7 percent had the same confidence that they can handle a 300 percent rise in Website traffic.

The survey of 300 IT workers at midmarket organizations was conducted online in partnership between Neustar and Decipher.

Respondents also had strong concerns over technology compromises made to keep costs down while trying to build for the successes targeted by management: 30 percent of the IT professionals surveyed go for savings through "every free or low-cost service" available, while only 12 percent say they're willing to fight for an "optimal" solution regardless of cost, and nearly half the respondents admit they recommend a "best option" to management but then settle for a compromise.

One key factor in this equation is DNS management, the foundation of a company's Web presence, which every online visitor relies on to engage with any large or small business on the Internet. In fact, 38 percent of the respondents said they use the DNS service provided by their ISP, while another quarter, 24 percent, rely on a "do-it-yourself" setup, and 16 percent count on a free, hosted option. While some of these services have come a long way, most simply don't have the scalability or stability required to keep an online business running through rapid spurts of growth, the report noted.

"Our research into this market has shown us the most common problems stemming from a lack of true scalability and related security-Website downtime and DDoS attacks-and our specific goal in developing the UltraDNS brand of solutions was to address exactly these issues," said Alex Berry, senior vice president of Internet infrastructure services at Neustar. "UltraDNS Basic provides optimal Website and application performance, while remaining affordable for companies that can no longer compromise performance and security. The new survey illustrates the huge market need for these services."

Small business consultant and columnist Gene Marks said many small businesses, particularly those powered by online marketing and increasingly dependent on e-commerce, know they might see spikes in online traffic anytime, but they're not ready for it. "These firms have become accustomed to free services with limited capabilities, and this becomes a serious problem when they need to scale up in a hurry," Marks said. "The market needs more DNS solutions that are simultaneously affordable, scalable, stable and secure."