Social Media and Small Business Success

Nico Brooks

February 18, 2010

Social Media and Small Business Success

Network Solutions has partnered with the Robert H. Smith School of Business at the University of Maryland to produce a series of studies tracking a variety of factors that affect the competitive health of small businesses. The most recent installment is detailed here: The State of Small Business Report – December 2009 Survey of Small Business Success. There is a lot of useful information in the report, ranging from statistics on methods of acquiring capital to characteristics of an effective workforce.

Below I have pulled out some choice statistics from the study relating to small business marketing and in particular social media. The number of small businesses who are using social media has doubled in the last year! While small businesses have been slower to adopt social media than big companies, they are starting to catch up. I believe this harkens a sea change in consumer habits, as social connections are strengthened between local consumers and local businesses. Mass marketing benefits big brands and big box stores, because it favors price as the common denominator across all consumers. But social media benefits businesses that are owned and operated by people who live in the community, because it favors social connections between individuals.

  • “The incidence of small businesses having a social media presence has doubled from 12 percent to 24 percent in the past 12 months.”
  • 70% of small businesses who use social media believe the medium has met or exceeded expectations.
  • 50% of small businesses who use social media say it has used up more time than expected.
  • 46% of small businesses have a web site – down from 50% a year ago.
  • Marketing & innovation was second to capital access in affecting overall competitiveness. Workforce, customer service, computer technology and compliance were all less important factors.
  • Referrals from existing customers are the most effective source of new customers.

Expectations and Accomplishments of Social Media

Oh, and unrelated to marketing, but I couldn’t resist pulling this statistic out as well:

60% of small business owners are highly satisfied and 33% are somewhat satisfied with their jobs. Only 43% of the overall population are satisfied with their jobs. Source for the latter: The Conference Board.