• by Ray Schultz , Columnist, December 11, 2020

Small businesses -- so hard-hit by the COVID-19 pandemic -- are spending more on digital advertising, and it seems to be paying off, according to The Rise of SMB Digital Advertising In 2020, a study by ClickCease.

There was a 670% increase in ecommerce advertising clicks for SMBs from March to October. And the study shows a 668% increase in click volume for entertainment advertisers, although their total numbers are far lower than ecommerce. 

Indeed, the overall click average is reduced to a still-robust 321% when all sectors are included. And as people have locked down during the pandemic, there has been a 230% increase for sports and fitness instructors and a 102% increase for addiction treatment. 

However, the fact remains that 40% of SMBs are not using paid digital advertising, and that the average number of digital channels used is just 1.3.

We bet the “1” in that number represents company websites, and that the “3” is email or social. 

The study points to research by Magna, showing that SMBs represent 65% to 75% of search and social media spend on Google and Facebook.

Even so, all this points to a need for investment in technology. 

The report is based on scrutiny of ad campaigns by over 6,400 small businesses in almost 30 sectors. 

Google ad expert Mike Ncube expects January 2021 to be “very strong and things to go back to pandemic levels. Unfortunately, the holiday season is not going to be great for many advertisers including small retailers," according to the study. 

One has to quibble with a couple of points in this study, one being that “the U.S. has reserved a much-needed $370 billion for small businesses loans” as part of the coronavirus stimulus package.

Many SMBS could not even get their banks to process such loans, and there are indications that large businesses profited most. 

Still ClickCeae contends that the "spend of this money on advertising recognizes the lifeblood of PPC spend: 60% of SMBs are currently using paid digital advertising, and half say that digital advertising is more important to their business now in time of crisis."

Really? And it’s unlikely that the $1,200 stimulus checks did much to revive the economy. Another round is needed. 

Finally, email marketing may be a better investment for SMBs barely breaking even than digital advertising.

As experts have pointed out, this is no time for acquisition campaigns — small firms should be working their existing customer bases.