Traditional Media Yields Extraordinary ROI For SMBs

According to the BIA/Kelsey Local Commerce Monitor, SMBs reported using an average of 7.6 different media to advertise or promote their businesses. 30% of the SMBs surveyed reported using broadcast, 57% use directories, and 65% use print/outdoor media to promote their business.

Eight of the traditional media from the study, newspapers and direct mail, are the only two to crack the Top 10 most used media list, but fall first and second among traditional media. Radio comes in third, with TV and outdoor lagging for usage.

Traditional Media Used for Advertising and Promotion by SMBs

Media

% of SMBs

Newspapers

32.2%

Direct mail

31.7

Radio

22.0

Magazines

19.7

Direct home

19.2

Cable

13.9

TV

13.7

Outdoor

12.9

Source: BIAKelsey LCM Wave, January 2014

SMBs perceive the return on their investment for time spent in advertising or promoting themselves on traditional media as excellent or extraordinary. The traditional media with the highest usage, newspapers, had the lowest perceived ROI, while the ones with lower usage: TV, cable and outdoor, had the highest ROI among the traditional media.

TV had the highest perceived ROI among the traditional media, with 50% of SMBs rating it as either excellent (10-19 times return on that investment) or extraordinary (over 20 times the return), though only 13.7% of SMBs surveyed reporting using TV to advertise or promote their business.

Newspapers, which had the highest usage among the traditional media, had the lowest perceived ROI, with 26% of SMBs reporting returns as excellent or extraordinary.

Radio had the third highest usage among SMBs for advertising/promotion. But advertisers who used radio as part of their advertising mix reported being pleased with the results, as 36% rated the perceived ROI of radio advertising as either excellent or extraordinary.

ROI Assessment of Traditional Media Used for Advertising by SMBs (% of respondents)

Media

ROI 10-19x Spend (Excellent)

ROI Over 20x Spend (Extraordinary)

TV

29.5%

20.5%

Cable

21.5

22.8

Outdoor

26.0

15.1

Radio

19.2

16.8

Direct home

18.3

16.5

Direct mail

22.2

10.6

Magazines

12.5

15.2

Newspapers

15.3

10.4

Source: BIAKelsey LCM Wave, January 2014

For the first time in several survey waves, SMBs indicated that they are actually decreasing the number of media used to advertise or promote their business. The implication: media must deliver concrete ROI or risk losing business traction. Digital media penetration with SMBs has increased, as many of these solutions generate concrete leads and offer trackable ROI metrics.

Traditional media are far from obsolete, as the data suggests, and many are still well-regarded. However, for newspapers in particular, and all traditional media, as SMBs enjoy more digital options and demand clear value from their advertising spend, the need to produce clear ROI is stronger than ever.

More information from BIAKelsey about the study and LCM can be found here.

 

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