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Report: Local Direct Business Owners Becoming More Internet Savvy? Are You?

March 10, 2011

Borrell Associates has just released a report entitled "Small Business's Become Everybody's Best Friend". The report summarizes feedback about media spending of about 2,000 small businesses. The growth in the coming year is expected to go mainly toward online. Radio came in fourth place behind online (1st) direct mail (2nd) and Newspapers (3rd). The report says "smaller businesses control 83 percent of all local advertising but thats only because there are so many of them, not because theyre big spenders. The average small business spent just $11,740 on advertising in 2010, about $2,300 of it online.

Gordon Borrell was the author of the report. We asked him to dig deeper into his findings.

Is it safe to say local/small businesses have learned the importance of the Internet in growing their business?
I wouldnt say that in past tense.  Theyre still learning.  The fact that theyre planning to increase online budgets 29% this year indicates that theyre at least convinced that theres something there with online advertising.  I believe its 50% experimentation, 50% actual results.  Like any other media buy.

How would you say a small business owner is going to react now if a salesperson (let's use radio as an example) comes through the door unprepared, with all the other salespeople calling on them?
We wrote a report last month urging sales reps to come clean about website stats.  Unique visitors arent unique at all.  The first person who  walks in the door and educates the advertiser about the REAL story is going to make it much, much harder for the hypesters who dont know  the difference between a clickthrough and a unique visitor.  So, yes, the fast-talking, high-pressure radio rep is going to be shut down pretty  quickly if shes peddling online advertising and doesnt know her stuff.
What was most revealing about your research?
"Small businesses are averaging 22 sales calls per month, and taking only 1 in 5 of them. That means its damned difficult to even get in the door these days.  Persistence is always the key to the door, that door is going to hit you in the ass pretty quickly if a sales rep talks about traffic and exposure but isnt prepared to discuss return on investment.  The advertising world has suddenly gone from buying eyeballs to buying results."

And the number one surprise from your research?
"Id say the biggest surprise is that 86% of SMBs already have a website, and that my website is the No. 1 thing they expect to spend money on this year.  Do you realize what that means?  The deer pretty much have the guns.  The Internet has given smaller businesses a direct channel  to consumers or at least thats what they think.  The smarter media companies will find a way to play to that belief and cultivate a relationship that drives traffic to the advertisers site through a myriad of things not just through a banner ad on the radio stations website. 

The need someone to help them drive traffic, not just buy one ad on one website.  That means help with email advertising, Facebook  campaigns, search engine optimization, radio commercials, deals programs, etc."

Read the entire summary HERE

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