- Small Business Marketing Trends to Adopt in 2021
- Small businesses ranked: Their biggest opportunity for gaining new customers
- Small businesses plan to increase spending on:
- Small businesses plan to decrease spending on:
- Small businesses plan to maintain spending on:
- Takeaways: Lean into what you see working
- Small-Business Owner Optimism Strong Amid Economic Concerns
- 2020 Presidential Campaign
- Challenges Facing Small-Business Owners
- Bottom Line
- No, it’s not money — this is the one thing small businesses need to succeed, according to survey
- Fortune favors the bold
- Self-confidence drives success
- The cost of starting certain companies
- Despite pandemic and economic instability, US small-business owners remain optimistic
- Returning to the best, pre-pandemic life
- Adaptability and growth
- Networking worked
- Getting help
- Generational matters
- Holiday effect
- Also see
Small Business Marketing Trends to Adopt in 2021
The most common platform for building brand awareness was social media marketing, which consistently outranked all other mediums.
After a 12% decrease in points, email marketing came in second, followed closely by content marketing and paid media, which ranked as the top four opportunities for building brand awareness.
After another massive drop, we see three more tactics closely grouped together: digital display advertising, event marketing, and influencer marketing.
There was another significant decrease after that, putting print advertising, podcast marketing, OTT/video streaming advertising, SMS marketing, and, finally, radio advertising in the lower rungs for brand awareness.
Biggest opportunity to build brand awareness: social media marketing (8675), email marketing (7766), video marketing (7730), content marketing (7697), online paid media (7626), digital display advertising (7356), event marketing (7320), influencer marketing (7209), print advertising (6855), podcast marketing (6622), OTT/video streaming advertising (6598), SMS marketing (6412), radio advertising (6410)
Small businesses ranked: Their biggest opportunity for gaining new customers
According to small businesses, the foremost opportunity for gaining new customers is, again, social media marketing.
Small businesses next ranked email marketing and online paid media, followed in close succession by event marketing and video marketing. Closely behind those came content marketing, then digital display advertising and influencer marketing.
Print advertising, podcast marketing, and OTT/video streaming advertising scored in the third tier, with little difference between each. Meanwhile, radio advertising and SMS marketing came in last for potential to acquire new customers.
Biggest opportunity for gaining new customers: social media (8784), email marketing (7659), online paid media (7587), event marketing (7575), video marketing (7541), content marketing (7498), digital display advertising (7410), influencer marketing (7393), print advertising (6727), podcast marketing (6684), OTT/video streaming advertising (6675), radio advertising (6370), SMS marketing (6291)
Small businesses plan to increase spending on:
The vast majority (78%) of respondents reported they would increase spending in digital marketing, following closely by social media (73%) and email marketing (57%).
Small businesses plan to increase spending on: digital marketing (801), social media (744), email marketing (587), event marketing (576), traditional marketing (470)
Small businesses plan to decrease spending on:
Of tactics being cut in budget by small businesses, traditional marketing came to the forefront, as almost 19% of respondents said they’d be decreasing spending there. Collected below that reside event marketing (11%), email marketing (10%), and social media (8%).
Small businesses plan to decrease spending on: traditional marketing (191), event marketing (116), email (99), social media (84), digital marketing (36)
Small businesses plan to maintain spending on:
While some small businesses plan on decreasing spending on traditional marketing, others—as much as 36% of respondents—plan to keep it consistent. This is followed up very closely by email marketing and event marketing at 33% of respondents.
Small businesses plan to maintain spending on: traditional marketing (365), email marketing (340), event marketing (334), social media (198), digital marketing (189)
Takeaways: Lean into what you see working
All in all, it looks most small businesses tend to increase their marketing budgets across the board, and very few plan to decrease certain tactics within their marketing strategy and budget. This is great news: These small businesses have found what works for them and intend to use their resources to do even more throughout the year.
These results also show that, even after everything and its users have been through, small businesses still view and other social platforms as a good opportunity to reach and expand their audience. But, if your small business relies on , be careful: You have to use intentionally in order to see a return, and that return may not be worth the potential loss of private data.
On the other hand, when small businesses utilize email marketing—which these respondents perceive as promising as —you own your own data and your website. You won’t have to worry about the website going down or an algorithm shifting beneath your feet.
And, while a majority of respondents plan to increase their spending on email or keep it as is, that still leaves about a third who plan to decrease their spending on email, even though it ranks firmly as a top channel for providing opportunities for both customer acquisition and brand awareness.
In the upcoming results, email ranks as the highest channel for customer communication, as well as the top channel for return on investment. So there’s a chance that the people who want to decrease their email spending may have invested money without optimizing their strategy or finding the right ESP to fit their small business’ unique needs.
Our survey shows that email continues to drive results and accomplish any of the biggest marketing challenges small businesses will face.
Small-Business Owner Optimism Strong Amid Economic Concerns
- Small-business owners remain optimistic about financial outlook
- One-third of small-business owners anticipate potential recession
- 69% say presidential candidates not focused on small-business issues
— Small-business owners' optimism continues to edge up in 2019. In the latest quarterly Wells Fargo/Gallup Small Business Index survey, conducted Sept. 30-Oct. 4, the overall index is at +142, up from +136 in July and +129 in April.
The index is a measure of owners' present and future optimism — both of which saw modest upticks this quarter.
The Small Business Index measures small-business owners' attitudes about a wide variety of factors affecting their business. The rise in the overall score this quarter is driven by modest improvements across most of the index items, rather than a significant improvement on any single dimension.
Additionally, when owners are asked a broad question about their financial outlook “for your business” over the next year, 77% say they are more optimistic than pessimistic — similar to the 79% recorded last quarter and up modestly from 70% in Quarter 2.
Although small-business owners remain very optimistic, their confidence in the overall economy, while still strong, has shown some signs of erosion. Sixty-three percent say the current state of the U.S. economy is excellent or good. This is down somewhat from 70% in July's Quarter 3 poll but on par with Quarter 2, when 63% rated the economy as excellent or good.
Small-Business Owners' Ratings of U.S. Economy
Of note this quarter is a new question asking owners about the possibility of a recession in the year ahead. Currently, one-third of small-business owners (33%) anticipate an economic downturn or recession in the next 12 months, while another 34% say it is somewhat ly and 27% say it's not very ly.
Owners clearly understand that their business success is tied to a strong U.S. economy — with a third (34%) saying the overall economic environment in the U.S. affects their business a great deal and 50% saying it affects them some.
At the same time, a significant majority of small-business owners (75%) feel they have the right strategy to handle future changes in economic conditions. And 86% report that they are either very prepared (24%) or somewhat prepared (62%) to handle “an economic downturn that might occur over the next several years.”
2020 Presidential Campaign
Although Election Day 2020 was still over a year away at the time of this survey, campaigning — particularly the fight for the Democratic presidential nomination — has been underway for many months.
Thus far in the campaign, small-business owners believe that the presidential candidates are not paying enough attention to small-business needs, with 69% saying that the candidates are not discussing the issues most important to them as small-business owners.
And 51% say that the outcome of the presidential election will have a major impact on their business.
Are Candidates Discussing the Issues Important to Owners?
In an open-ended question, small-business owners were asked to name the most important issue on which they would the presidential candidates to focus during the campaign.
Owners named a variety of issues, but the three most frequently mentioned were taxes/tax relief, healthcare/insurance and the overall economy.
Other issues named by 5% or more of small-business owners included trade tariffs, general issues related to small businesses, and the need for “less socialism and government rhetoric.”
Issues That Candidates Should Focus on During Campaign
When asked specifically to rate the importance of a number of issues that the winner of the 2020 presidential election should address when they take office, small-business owners were most ly to rate “economic policies that affect small-business owners” as extremely or very important, followed by tax code changes/tax regulations/tax rates, increasing consumer confidence in the economy, and healthcare. Owners were least ly to mention increasing the minimum wage, the Small Business Administration, environmental regulations/climate change, and government regulation of banks as important issues for the 2020 winner to address.
Challenges Facing Small-Business Owners
Owners continue to be most ly to cite “attracting customers/finding new business” as the top challenge facing their business, in line with most recent surveys. This quarter, competition from other larger companies and online retailers was the challenge next most ly to be cited, followed by hiring and the difficulty associated with being self-employed.
Small-business owners remain upbeat about their company's financial outlook.
While a majority rate the national economy as excellent or good, there is some anxiety over the potential for an economic downturn or recession in the next 12 months.
These owners understand that their fortunes are tied to the current state of the U.S. economy, although most feel at least somewhat prepared to handle a recession should it come.
Small-business owners recognize that the outcome of the 2020 presidential election will have a major impact on their business — but so far, only about three in 10 believe the candidates are discussing the issues important to them, which appear to be the economy, taxes and healthcare.
For more information about Wells Fargo Works for Small Business, visit https://wellsfargoworks.com/. Follow us on @WellsFargoWorks.
Learn more about how the Wells Fargo/Gallup Small Business Index works.
No, it’s not money — this is the one thing small businesses need to succeed, according to survey
As any entrepreneur knows, it’s easy for doubts to creep in when starting a business.
It’s no surprise that having enough capital tops the list of concerns, but there’s optimism to share for those starting their business journey when it comes to limited funding.
Kabbage recently polled 600 thriving US small business owners to better understand their cash flow issues and discovered that the old adage, “it takes money to make money” is not always an initial obstacle in the early days of building a business.
Fortune favors the bold
The Kabbage survey found the majority of small businesses built long-lasting companies even when facing initial cash flow deficits and short run rates:
- Of the respondents surveyed, 58 percent started with less than $25,000 and one-third started with less than $5,000.
- 65 percent of entrepreneurs admit they were not fully confident they had enough money to start their business.
- 93 percent calculated a run rate of shorter than 18 months, of which 25 percent calculated a run rate of less than six months, and 36 percent didn’t calculate this at all.
Yet all companies in the survey have been successfully in business for an average of nearly 11 years.
Self-confidence drives success
Self-confidence drives the most success for small businesses.
Despite the financial uncertainties, entrepreneurs have the grit, self-determination and confidence to jump start a business in an unfamiliar industry as 41 percent started a business unrelated to their previous profession.
Yet, 82 percent didn’t doubt they had the right experience to start and run the new company. And many entrepreneurs pursuing their passion — they made the crazy, risky, brilliant and bold decision to begin.
Admittedly, small business owners indicated they had the least amount of experience in financing and bookkeeping (35%), legal and compliance (29%) and marketing and advertising (28%) when starting their business.
Tony Hernandez, a Kabbage customer and owner of Cienfuegos Cuban Cafe in Simi Valley, Calif. was formerly a media executive in Los Angeles before taking the leap into entrepreneurship. He admits, “cash flow is king” when you're starting a business, especially a restaurant.
“It’s critical to have enough capital in your account in case something comes up or slows down.
Although he was confident in the business idea — his sandwiches had gained a following at local farmers' markets and street festivals — Tony encountered unexpected expenses before his grand opening of his brick-and-mortar location.
A state health inspection required the purchase of an industrial floor sink and a new restaurant code required him to install a specific tile for the counters. The unplanned expenses totaled nearly $10,000 and caused a rippling effect in his business.
Tony reflects, “The biggest impact wasn’t realized until later because it delayed our final inspection, which pushed back our opening date, meaning we had to incur additional rent and labor costs without a single sale. The true impact might be closer to double the construction costs.”
With access to a line of credit, Tony surpassed his first-year business projections in just eight months after opening.
Today, confidence still drives Tony’s success, but he says it has to be met with investments. “After being in business for 1.5 years, our systems and people are in place.
We’re confident that our concept will continue to grow as long as we continue to invest time and money on scaling.”
Rob Frohwein, CEO of Kabbage. Courtesy of Kabbage
The cost of starting certain companies
The data also showed that while start-up money was lower than anticipated for many, there are some industries that cost more to start a company than others. the initial amount of money spent within the first six months of business, these business owners in these industries noted start-up costs of more than $100,000:
- Restaurants (38 percent)
- Medical Offices (23 percent)
- Manufacturing Companies (19 percent)
Alternatively, these three business types required the least amount of startup capital — $5,000 or less during the first six months:
- Accounting (45 percent)
- Online retail (44 percent)
- Construction and landscaping (39 percent)
Overall the data shows cash flow and run rate uncertainties are all too common among small business owners.
But while small business ownership may seem daunting, today’s funding options open opportunities to better handle cash flow and smooth those uncertainties.
This, coupled with the power of an entrepreneur’s tenacity and self-confidence to succeed, champions their doubts and compels them to start the amazing journey of entrepreneurship.
Rob Frohwein is the CEO and co-founder of Kabbage, a global financial services, cash flow technology and data platform which has helped small businesses access billions of dollars in funding.
Despite pandemic and economic instability, US small-business owners remain optimistic
Most US small business owners see a bright future for financial prospects, businesses returning to pre-pandemic conditions, and that they'll still be in business in spring 2021.
It's ly that optimism buoyed many small business owners (SBOs) to start and build their businesses to successful heights. But in March, businesses were slammed by the impact of the coronavirus pandemic, as all but essential businesses shut down.
If they were lucky to have an online presence (or built one very quickly) or they were able to turn their workforce into telecommuters, it was certainly less impactful than on SBOs forced to fully shut down, as dine-in restaurants did for many weeks.
A new report from Capital One surveyed 1,000 business owners and 500 financial decision makers between Sept. 9 and 22 for its “Capital One Business Survey Fall 2020” and discovered that 62% of SBOs are confident their businesses will eventually return to pre-pandemic conditions. A vast majority (87%) predict that they'll still be in business by spring 2021.
Returning to the best, pre-pandemic life
The report said 57% of small businesses that responded, despite the imposed restrictions and the narrowed margins, said their current financial position is the same or even better than pre-pandemic numbers.
“It's encouraging to see that many small business owners are confident that their businesses will return to pre-pandemic revenues,” said Jenn Garbach, head of business brand and marketing at Capital One, in a press release.
Nearly four five (75%) business owners who applied for financial assistance (e.g., business credit card, grant, line of credit, or government relief such as a Paycheck Protection Program loan), believe that the assistance they've received during the pandemic will help them stay in business for the long term.
SEE: Top cloud providers in 2020: AWS, Microsoft Azure, and Google Cloud, hybrid, SaaS players (TechRepublic download)
Adaptability and growth
A legitimate fear evolved: As economic disruptions were raging, business owners dealt with the fear of having to let staff go–or the most frightening of all, be forced to shutter the business entirely. However, the majority of SBOs adapted quickly and were able to both stay in business, but keep their employees, too.
Only 2% of business owners report they had to shut down their small businesses permanently, and of the industries that were the hardest hit: Food services, construction, and technology businesses: 82% of business owners were able to either keep the same or increase the number of their employees, 57% were ordering the same amount of supplies or more than pre-pandemic, and less than 20% of business owners reported that because of the pandemic, they had to cut back on their services or products.
“In the face of an ongoing pandemic, the fact that small businesses remain optimistic is a real testament to their resiliency and the essential role they play in our communities,” Garbach said in a press release.
The Capital One report revealed that SBOs' credit networks of associates–rather than taking on debt or applying to relief programs–were key to navigating and beating the pressures of the pandemic. SBOs said they relied on personal networks of associates, peers, and advisors for guidance, which was much preferable than to further burden the company with debt.
There were a lot of disappointed SBOs who were unable to secure money to stay afloat. The figures continue to surprise: 58% of SBOs reported they did not need financial support in the past six months.
With networking acknowledged as the key to keep SBOs, it makes sense that 61% of small businesses explained they need more practical advice and tools such as training or consulting support to help them find the best methods to run the company.
Even though many opted burdening the business with debt or slogging through financial aid, 43% of respondents admitted that they were open and willing to accept donations to help address the businesses' pressing problems.
The future is bright for 83% of minority small businesses owners, and among this group, 57% said they've applied for financial assistance.
There's also a race gap when it comes to the confidence they have in their business to operate through the year's end:
- 83% of minority business owners said their businesses will be operating through the end of the year
- 89% of non-minority business owners said their businesses will be operating through the end of the year
- 57% of minority-owned businesses report they applied for some kind of financial assistance
- 39% of non-minority-owned businesses report they applied for some kind of financial assistance
- 82% of minority-owned businesses are more ly to have spent money adapting their businesses to keep them running during the pandemic
- 60% of non-minority-owned businesses are more ly to have spent money adapting their businesses to keep them running during the pandemic
- 79% of minority business owners said they have consulted an external source for financial support and advice since the pandemic's onset.
The instinct for survival kicked in while the pandemic disrupted operations for business owners of varying generations.
Baby Boomers relied on experience and background, a culmination of their ability to survive: 32% of Baby Boomers applied for financial support, and 51% of Boomers spent money to adapt their businesses to keep it running during the pandemic. To help address their business' financial needs, 27% of Baby Boomer business owners would accept donations, and 47% of Baby Boomers report they needed resources or tools to help them navigate their business through the pandemic.
Millennials, on the other hand, are more inclined to be open and leverage a variety of outside sources to stay in business. More than half (56%) of millennial business owners applied for financial assistance since the pandemic began.
Millennials are more ly (83%) to have spent money attempting to adapt their business to keep it.
When it comes to accepting donations, 77% of millennials said they would; 86% of millennials report they needed resources or tools to help them navigate their businesses through the pandemic.
“As we head into the busiest time of year for many small businesses, it's critical for us to rally around our local entrepreneurs,” Garbach said in the press release.
“One way folks can do that is by shopping directly at small businesses over the holidays, or by donating and making sure business owners have the resources they need to navigate the road ahead.
In the face of an ongoing pandemic, the fact that small businesses remain optimistic is a real testament to their resiliency and the essential role they play in our communities.”
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