Crunch Time for Small Business Advertising: The Long Tail Needs Better Targeting

Small businesses (SMBs) represent the long tail of media advertising. Though small individually, their spend power is mighty in aggregate, as Facebook and Google recognized when they moved first into scalable, self-serve advertising, which cemented their dominance in digital.

With economic headwinds picking up (e.g., later-stage pandemic, inflation, supply chain, the great resignation), small businesses have even more riding on their advertising efforts. They’re looking for greater returns from every investment, and they’re likely to make fewer, potentially bigger bets on the channels that drive maximum impact.

Whether they predominantly sell offline or online, SMBs won’t settle for overall brand awareness. They’re prioritizing website traffic, online leads, and online sales in addition to driving overall awareness. Accordingly, SMBs put most of their money into digital channels, starting with social media and search. Locally focused small businesses are even more reliant on the combination of paid social and paid search (41% of ad budgets) than SMBs overall (28% of ad budgets).



Yet this year a significant number of SMB advertisers are branching out into such channels as digital audio, podcasts, video and mobile in-app. That’s a challenge since SMB marketers typically wear many more hats than media planning and buying. They often lack the creative resourcing and omni-digital media fluency that typify large advertisers.

Media can make inroads by lowering barriers to entry with affordable, low-risk offerings that don’t require more people to launch and maintain. 

  • Expand test-and-learn packagesAs SMBs venture into media with higher CPMs than search and social, they need to test at a scale that will prove business impact. This will make it more palatable for them to agree to larger campaign expenditures going forward.
  • Beef up self-service tools. SMB’s relative lack of media experience means self-serve tools need to be more robust than many media sellers realize. Facebook and Google turned self-service into a well-oiled machine for SMB advertisers of every stripe and level of expertise. Likewise, Spotify’s suite for creating audio and podcast ads is propelling the platform. In addition to making campaigns manageable, full self-serve systems increase SMBs’ media fluency.
  • Increase turnkey creative assistanceSMBs can’t do everything they need on self-serve. Particularly in more expensive media they want to employ, such as streaming TV, good creative is harder to make. They need hands-on help in more sophisticated content. Adding more SMB advertising requires fielding more service staff. 

Importantly, SMBs need to trust that a media seller’s team is there for them. Nearly half (48%) say they will downgrade a media partner based on trust factors. And for SMBs, that’s more about effectiveness and support than the perceived brand safety of content environments. 

The service upgrades media providers make to help SMBs now should pay dividends when the economic tides turn, and smaller advertisers move up the food chain or make recommendations to more businesses like theirs. It’s particularly important as more advertisers take digital media operations in-house. 

SMBs may be the long tail of ad spending, but they’re arguably the backbone of the wider economy. Media that meet them where they are now will get on the future short list for this highly valuable segment.

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