Small Businesses. Then & Now

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1 Small Businesses Then & Now 1

2 How are things different for small business owners than they were five years ago, when the economic crisis started to unfold and social media gained a foothold with Facebook? Constant Contact surveyed small businesses to find out. Their answers provide an inside look at their evolving challenges and opportunities

3 No one said it would be easy. When asked if they feel it s easier or harder to run a small business today than it was five years ago, here s what they said: Easier, 12% About the same, 30% Harder, 59% 3

4 Five years ago I felt like I was in a marathon, but not yet running. We were doing good, but I felt I had hit the wall with market share. I was a little old fashioned, but decided to try using marketing. Once we mastered that, we started to explore what was next on Facebook and Twitter. Now social media is critical to our success. I m even teaching bookbinding classes real time via Skype. -Michael Chrisman, Bookbinders Workshop 4

5 Challenges Abound Why do you think it s harder to run a business today? 60% 55% 50% 49% 34% 30% 19% 19% 18% 0% Economy has hit my business hard Harder to keep pace with technology More direct competitors More competition from big business Other Harder to attract good employees Harder to secure loans 5

6 Buy Local Some good news - the buy local movement is gaining steam. Do you feel that being locally owned and operated is a major reason why your customers support your business today? Not locally owned or operated, 4% Not sure, 15% People want to shop local, they want to eat local. People come to our store specifically looking for Minnesota beers. -Bryan Buser, The Four Firkins Yes, 51% No, 30% 6

7 Change is Inevitable Business today can t be scared by change. Sure, it can be frustrating sometimes, but businesses really need to embrace change and find out what s new and where technology or best practices for using tools is going. -Seth Tower, GunnDesign Biggest changes in how you do business today vs. five years ago 90% 84% 80% 70% 60% 50% 30% 0% 59% 27% 26% 22% 21% 16% 11% 1% 7

8 Social Media Explodes Marketing tools used today vs. five years ago 98% 100% 87% 90% 80% 70% 64% 60% 50% 44% 38% 36% 31% 30% 24% 21% 23% 22% 12% 12% 6% 6% 8% 2% 2% 0.50% 0% 5 years ago Today We re using about the same amount of digital marketing tools as five years ago, we re just using them differently. Five years ago we just had Facebook and Twitter accounts, but today we re making a point to post every day. -Bryan Buser, The Four Firkins 8

9 Business Concerns Their primary concerns have remained virtually the same. Top business concerns five years ago vs. today 80% 70% 60% 50% 30% 78% 75% 61% 65% 49% 58% 5 years ago Today 0% Finding new customers Having enough time Retaining existing customers 9

10 Customer Insights Do you think it is harder or easier to find customers today versus five years ago? About the same, 35% Harder, 35% Easier, 30% We re always concerned about finding new customers because in our industry you never know when a current customer or project will go away. It s a revolving door, so we can never stand still and always need to be pushing forward. As a result, we re always looking at ways to engage with our current customers so they can tell others about the great work we ve done for them. Seth Tower, GunnDesign 10

11 The Customer Dilemma Why is it harder to find customers today versus five years ago? 50% 45% 35% 30% 25% 15% 5% 0% 49% Customers pay less attention to marketing 45% More direct competition 23% 23% More expensive to do marketing Can't keep pace with all of the online marketing tools None of these 11

12 12

13 Finding Customers with Tech Tools Why is it easier to find customers today versus five years ago? 60% 53% 50% 30% 28% 22% 5% 0% More affordable online marketing tools Time-saving marketing tools Customers respond to marketing None of these Less direct competition 13

14 14

15 Spending Patterns Are your customers spending more money at your business today than five years ago? 50% 30% 49% 38% 13% 0% Yes No Not sure 15

16 Customer Demands Do you feel your customers have higher expectations today than they did five years ago? 70% 60% 50% 30% 0% 63% 22% 16% Yes No Not Sure Customers are more demanding. They re seeking fresh marketing formats and ideas, and they expect a fast turn-around. Like everyone, really, customers want more to maximize their spend. -Debra Farrell, Diverse Resources 16

17 Great Expectations Why do you feel customers have higher expectations today than they did five years ago? 80% 70% 71% 60% 50% 48% 44% 42% 30% 14% 0% Expect more value Expect better customer service Expect more deals and coupons Expect better quality goods/services Other 17

18 More is Better How has the volume of new customers changed? Stayed the same, 19% Decreased, 26% Increased, 55% 18

19 Optimism Reigns Despite the challenges they face, small businesses maintain a positive outlook. Where do you see your business five years from now? 60% 58% 50% 30% 26% 0% Thriving, with more customers and/or more employees 8% 7% Holding steady Possibly closed Don't know 19

20 About the Survey This Constant Contact-sponsored survey was administered in May of 2013 to 917 small business participants in the Constant Contact Small Biz Council a research panel of US small businesses recruited from the Constant Contact customer base. This survey was fielded to those panel members who have been in a decisionmaking role in a small business for at least five years, and they were asked their opinions on how operating a small business today differs than five years ago. This survey is part of an ongoing series about the state of small businesses and the ways they connect with, and grow, their audiences. Results include responses from respondents across a range of business-to-business and businessto-consumer industries.

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