Constant Contact Small Business Pulse The Health and Wellness of Small Businesses

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1 Constant Contact Small Business Pulse The Health and Wellness of Small Businesses Based on Research Conducted in May 2012 Copyright 2012 Constant Contact Inc. 1

2 In This Report What s Keeping SMBs Up at Night? Small Business Resources and Hiring SMB Marketing Activities About This Report Copyright 2012 Constant Contact Inc. 2

3 1. What s Keeping Small Businesses Up At Night? Copyright 2012 Constant Contact Inc. 3

4 Attracting new customers, engaging existing customers, and getting referrals are the top concerns for small businesses surveyed When you think about how to run your organization most effectively, which of the following keeps you up at night? % 76% 71% 49% 48% 41% 43% 38% 38% 34% 33% 31% 26% 27% 26% 28% 25% 26% 23% 24% 17% 18% 16% 5% 4% 8% Total B2C B2B Copyright 2012 Constant Contact Inc. 4

5 Attracting new customers is the #1 challenge facing SMBs; getting funding is also a large challenge Of the items that keep you up at night, which do you rank #1? % 68% 69% 45% 41% 52% 29% 26% 24% 18% 16% 18% 14% 14% 15% 11% 13% 11% 11% 11% 12% 9% 11% 12% 12% How to attract Getting funding new customers How to connect and better engage with existing customers Having a more integrated communication strategy How to get referrals from current customers Total B2C B2B How to stay on top of the latest in online trends How to identify and select the best tools How to measure the impact of my campaigns How to make my dollars go further Copyright 2012 Constant Contact Inc. 5

6 Attracting new customers, engaging existing customers, and getting referrals are the top issues for small businesses When you think about how to run your organization most effectively, which of the following keeps you up at night? % 76% 71% 49% 48% 41% 43% 38% 38% 34% 31% 33% 26% 27% 26% 28% 25% 26% 23% 24% 17% 18% 16% 5% 4% 8% Total B2C B2B Copyright 2012 Constant Contact Inc. 6

7 2. The Health of Small Businesses Copyright 2012 Constant Contact Inc. 7

8 The majority of small businesses surveyed are stable or growing compared to 2011 How has your organization done so far this year? 7 59% 59% 31% 28% 11% 12% Total B2C B2B Revenues increased Revenues remained flat Revenues decreased Copyright 2012 Constant Contact Inc. 8

9 Many SMBs are expecting significant revenue growth this year, few are expecting a major decrease 79% of small businesses expect 2012 revenues to increase over their 2011 revenues with 52% expecting revenues to increase more than. What are your revenue expectations this year compared to last year? I expect my revenues to 54% 52% 27% 23% 13% 13% 14% Total B2C B2B 4% 4% 5% 3% 4% 3% Increase more than Increase less than Remain flat Decrease less than Decrease more than Copyright 2012 Constant Contact Inc. 9

10 Cash flow is affecting growth for over of small businesses Despite operating costs having increased for 45% of small businesses, 57% of small businesses have adequate cash flow to run their business effectively. 19% of small businesses have sought funding this year, of which 16% got some or all of the funding they needed. Is your cash flow sufficient to run your organization effectively? 7 57% 53% 63% 32% 27% 11% 13% 8% Total B2C B2B Yes, I have adequate cash flow No, my cash flow is inadequate and is preventing me from growing No, my cash flow is inadequate and is barely enough to maintain current operations Copyright 2012 Constant Contact Inc. 10

11 Over half of small businesses are not planning to hire more FTEs in the next 6 months So far this year 63% of small businesses have kept the number of employees the same. 27% of small businesses have increased the number of employees. have kept payroll the same, while 38% have increased payroll. Will you be hiring additional full-time equivalent (FTE) employees in the next 6 months? 47% 52% Total B2C 25% 18% 19% 13% 21% 15% 16% 13% B2B No, I m doing fine as is Yes No, I need to but can t Unsure Copyright 2012 Constant Contact Inc. 11

12 3. Small Business Marketing Copyright 2012 Constant Contact Inc. 12

13 Marketing spend has stayed steady for most small businesses surveyed So far this year, the budget has % 61% 29% 29% 28% 12% 12% 11% Increased Decreased Stayed the same Total B2C B2B Copyright 2012 Constant Contact Inc. 13

14 , websites, and in person interactions are most often effective for small businesses Which activities do you find to be effective for your organization today? % 84% 81% 71% 72% 7 68% 64% 75% 49% 56% 43% 41% 38% 38% 33% 49% 23% 22% 22% 22% 21% 22% 22% 19% 17% 17% 18% 15% 5% 5% 4% 8% 8% 9% Website In-person interactions Social media Events Phone calls (for lead generation, etc.) Public relations Direct mail Traditional advertising (print, radio, TV, etc.) Online advertising (paid search, etc.) Online Other, please surveys and specify polls Total B2C B2B Copyright 2012 Constant Contact Inc. 14

15 Small businesses are still most driven by in person interactions Of the items you find to be effective, which do you rank as the #1 most effective? 7 59% 48% In-person interactions 28% 33% 23% 27% 21% 17% 15% 17% 18% 14% 17% 18% 17% 15% 13% 17% 11% 13% 8% 11% 12% 8% 6% 3% Website Direct mail Traditional advertising (print, radio, TV, etc.) Online advertising (paid search, etc.) Total B2C B2B Phone calls Events Social media Public relations B2Bs are even more in person focused 8 59% In-person interactions 17% 15% 14% 17% 17% Website Direct mail Traditional advertising (print, radio, TV, etc.) Online advertising (paid search, etc.) 8% 8% Phone calls Events Social media Public relations Copyright 2012 Constant Contact Inc. 15

16 Of those using social media, Facebook is far and away the most effective, even for B2Bs If social media is ranked in the top 3, which tool do you find the most effective? % 75% 55% 25% 11% 7% 6% 3% 1% 1% 3% 6% 1% 2% 1% 2% 2% 2% 2% 2% 2% Facebook Twitter LinkedIn Pinterest Google+ YouTube Yelp Other, please specify Total B2C B2B Copyright 2012 Constant Contact Inc. 16

17 Still, SMBs need more help with social media 7 59% 66% Social media 47% 42% 38% Which activities do you need help with? 33% 29% 25% 25% 23% 19% 19% 19% 19% 18% 19% 17% 16% 16% 12% 13% 9% Website Online advertising (paid search, etc.) Online surveys and polls Public relations Phone calls (for lead generation, etc.) Events 11% 11% 12% 9% 11% 8% 9% 9% 9% 8% 5% 4% Direct mail In-person interactions Traditional advertising (print, radio, tv) Other, please specify Total B2C B2B 53% of Small Business ranked social media as the channel they need the most help with Copyright 2012 Constant Contact Inc. 17

18 About this study This is the first wave of an ongoing study about the state of small businesses and the ways they connect with and grow their audiences. We surveyed over 1000 participants in the Constant Contact Small Biz Council a research panel of US small businesses and nonprofits recruited from the Constant Contact customer base between April 24 and May 8, This preliminary report includes responses from 728 participants including 448 business-to-consumer organizations and 280 business-to-business organizations. Media Contact Erika Dornaus Constant Contact (781) Number of employees for businesses included in this study 14% 6% 6% % Copyright 2012 Constant Contact Inc. 18

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