SMBs Take on Mobile to Increase Sales

Mobile impacts all businesses -- but it may affect them in different ways, depending on size.

While many of the major brands have well-developed apps and some are beginning to embrace the mobile Web, small and medium-sized businesses (SMBs) may be charting a somewhat different course.

With mobile media spending projected by Strategy Analytics to hit almost $12 billion this year (compared to mobile consumer spending of $138 billion), there is somewhat of a wide range in how marketers allocate budgets versus how consumers are behaving with mobile.

There is also a gap between national versus local advertising revenue, with national closing out the year at about $1.6 billion compared to local at $211 million, according to PQ Media. The disparity in dollars spent can be rationalized by the fact that brands focus on national buys, such as through mobile video and search, while smaller businesses focus more locally.

This leaves the question of what SMBs are doing with mobile -- if not investing in national advertising or other areas that attract the larger national brands.



We looked to Borrell Associates, the research firm that focuses on the SMB marketplace, and found some insights and early indicators of where that market may be heading compared to their larger counterparts.

For mobile campaigns by SMBs, the number one tactic, as you might expect, is SMS -- with almost half (46%) of the businesses using it. In the context of global research from Chetan Sharma Consulting that came out earlier this week, non-messaging services now account for more than half of all mobile data revenue -- showing that texting no longer dominates data revenue, as it did seemingly forever.

But while texting is king for SMBs, with rich media, not so much.

Only five percent of them use MMS, the same percentage that use NFC (Near Field Communication) or location-based tactics, which could translate into simple ads on Foursquare.

Video also has potential for growth, since only eight percent currently use it.

More surprising is that the number two mobile tactic after texting is using 2D barcodes, with 41 percent saying they use them. Of the leading brands and agencies using 2D codes, a percentage of them don’t even lead to a mobile-optimized experience, which begs the question of where the SMB codes are taking their customers -- but that’s for another day.

With consumers projected to download 66 billion mobile apps annually within four years -- which is more than double the number downloaded last year, says Juniper Research -- many of those will not be coming from SMBs.

As a mobile tactic, only one in five SMBs use apps, which trails the number using mobile Web sites (38%) and mobile advertising (26%).

The SMBs in the research are defined as non-traditional accounts that have contracted for advertising in various media, and these early findings are from a series of three different market studies.

One of the early indicators of the research is that SMBs may be starting to differentiate social marketing programs as a branding tool to reach new customers while mobile is being used as a direct-response platform, according to Borrell Associates’ Senior Researcher Greg Harmon, who is leading the study.

He found that to measure the success of social marketing programs, the key metric was getting new customers, listed as very important by 83 percent of SMBs. Meanwhile, the most intensive success metric for mobile media programs was increased sales volume, to 78 percent of the SMBs.

A key measurement of success for both social and mobile media programs was creating visits to Web sites, with 84 percent of those using social marketing programs saying it was very or somewhat important and 91 percent of those using mobile media programs saying it was.

As context, the top success metrics for success in a recent mobile study by The Center for Media Research at MediaPost Communications were behavioral metrics (including ad interaction and click-through) and conversion (sales, email registration, and coupon download).

We’ll be watching over time to see if the mobile tactics of the national brands and SMBs sync or go their separate ways.

5 comments about "SMBs Take on Mobile to Increase Sales ".
Check to receive email when comments are posted.
  1. Dan Auito from Next Century Studios, May 2, 2012 at 1:13 p.m.

    Video tied to a mobile screen with analytics and subsequent one touch calls to action is a superior way to instantly deliver rich media and engage the viewers on multiple social media fronts.

    Integrated solutions tying video, mobile, ease of engagement and tracking is fundamental to deploying a fully optimized solution for SMB's.

    At we do it every day!

  2. Chuck Martin from Chuck Martin, May 2, 2012 at 2:03 p.m.

    Yes, just taking a bit of time for the market to get there!

  3. Bill Ganon from Connect2Sell , May 2, 2012 at 4:44 p.m.

    Drawing on the last 2.5 years of giving at least 250 webinars/presentations devoted to local mobile advertising, it's been my observation that local advertisers are finally evolving from text based campaigns into more engaging mobile display campaigns largely due to better understanding and the exploding smartphone market. Click to call, location and email are creating meaningful connections with local customers.

  4. Kevin Horne from Lairig Marketing, May 2, 2012 at 5:37 p.m.

    "The SMBs in the research are defined as non-traditional accounts that have contracted for advertising in various media..."

    Can you elaborate? I find it impossible to believe that 46% of the 20 million SMBs out there are using SMS. I'll pass 100 shops on my walk to the subway tonite, and I'll bet less than 5 of them will even know what we are talking about here...


  5. Chuck Martin from Chuck Martin, May 2, 2012 at 5:56 p.m.

    Noted, Kevin. The preliminary research, which is ongoing, did not include specific demos and respondents identified only as not non-national accounts who essentially have used local media for advertising. There will be plenty more SMB research coming so the ultimate outlook, with the increase in smartphone usage, also is likely to evolve. (did you see Bill's comment?)

Next story loading loading..