SMB Business Perspectives: 2011 Results and 2012 Projections

Transcription

1 SMB Business Perspectives: 2011 Results and 2012 Projections November 2011

2 Overview and Methodology Objective Obtain a deeper view of business projections from small to mid-sized businesses (SMBs) for 2012 compared to Approach Zoomerang distributed a survey to SMB decision makers over a four day period, from November 3-7, Results In total, 1,003 SMB decision makers (e.g. founders, managers, etc.) completed the survey providing insights into their 2011 business results and 2012 projections. Insights Economy - Of those surveyed, a majority (61%) stated that their business had been negatively impacted by the economy, yet 40% remain optimistic or very optimistic about their business heading into Half (50%) of respondents failed to meet their business goals in 2011, however, only 19% have plans to diversify their business in Business Growth - The biggest challenge for SMBs in 2011 was customer/client growth despite the highest hiring rate in the business development sector. Similarly, 60% of SMBs plan to focus investments and staffing in the same sector in Of the SMBs creating new staffing positions, filling an existing position or promoting employees, the most promising business sectors for job applicants are social media and business development. - In 2012, nearly half (45%) of SMBs plan to invest money in marketing and communications. Similarly, a third (33%) of respondents project using advertising/marketing or social media to attract new customers. Social Media - In 2012, more than a third (40%) of SMB respondents plan to use social media, yet only a quarter (25%) expressed discomfort with using social tools. - The top three reasons SMBs use social networks are: affordability, access to customers and word-of-mouth/referral. 2

3 Annual Projection Comparisons Key Takeaways Overall Summary of 2011 Projections (*previously completed survey findings from 2010) The majority of SMBs were optimistic about the coming year and were confident that the economy was beginning to stabilize and improve, predicting higher sales and staff hiring growth. Overall Summary of 2012 Projections The majority of SMBs were neutral to positive about the economy and their business heading into Compared to 2011, SMBs are more hesitant to hire additional staff. Even though most see the value of social media for customer relations, most SMBs do not understand the tools or feel comfortable using them. Insights Economy 2011: As compared to 2010, the SMBs surveyed were optimistic about the economic outlook with 72% believing it would improve or stay the same. 2012: When considering business performance heading into 2012, 40% of SMBs are optimistic or very optimistic. Of those surveyed, 40% of SMBs agree that small business is the backbone of the economy. Business Growth 2011: Compared to the previous year, 89% of SMBs planned to grow or maintain their staff. 2012: Less than a third of SMBs plan to hire more employees in 2012 compared to the previous year. Social Media 2011: Social media adoption was slow, with only 33% of the SMB respondents planning to use social media. 2012: Of those surveyed, 40% of the SMBs plan to use social media in 2012, despite a quarter of respondents stating they do not feel comfortable using social tools. 3

4 2011: Business Goals Half (50%) of the SMBs surveyed are falling short of meeting 2011 business goals, whereas 43% of SMBs are on track or have already exceeded most goals Is your business on track to meet most or all of its 2011 goals? 3 7% 7% 50% No, we are falling short of meeting most or all of our 2011 business goals (50%) Yes, we are on track to meet most or all of our 2011 business goals (3) Yes, we have already met and plan to exceed most or all of our 2011 business goals (7%) I don t know (7%) 4

5 2011: Business Challenges SMBs were challenged most by customer/client growth and retention as well as budget constraints What were your business biggest challenges in 2011? (Select all that apply) Customer or client growth 44% Budget constraints Customer or client retention 32% 32% Staying in business 27% Local competition 20% Communications/Marketing/PR Other Technology innovations Internal employee retention Internal employee growth 9% 9% 9% 8% Outsourcing manpower/materials/labor 4% 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 5

6 2011: SMB Business Performance Most SMBs did not experience growth or loss in the most common business sectors How would you describe the performance of each area of your business in 2011? Experienced Growth Stayed the Same Experienced Loss N/A Business development 14% 44% 27% 15% Communications/Marketing/Sales 14% 4 23% 17% IT 9% 53% 27% Accounting 8% 57% 20% 1 Product team 8% 45% 15% 31% Human Resources 8% 49% 30% Executive team 7% 53% 27% Administration 7% 65% 12% 1 6

7 2011: Economic Impact In 2011, more than half (61%) of the SMBs surveyed were negatively affected by the economy How has the U.S. economy affected your business in 2011? 3% Negatively (61%) 25% Positively () Has not affected (25%) 61% I don t know (3%) * In 2011, 40% of SMB respondents experienced limitations or constraints as a result of U.S. administration policy changes. 7

8 Affects of 2011 Economy 2011: U.S. Economy Impact and Hiring Among the responses, there was a direct correlation between businesses impacted by the economy and hiring projections for Affects of 2011 U.S. Economy on 2012 hiring plans Plan to hire in

9 2011: Employees More than three quarters of SMBs did not hire or reduce number of employees in the most common business sectors Did you add more employees, reduce the number of employees or keep the number of employees the same in each department during 2011? Added More Kept Same Number Reduced Number Communications/Marketing/Sales 7% 80% Product team 79% 15% Business development 81% Executive team 5% 83% 12% IT 5% 80% 14% Administration 5% 82% Human Resources 4% 82% 14% Accounting 4% 85% 9

10 2012: Business Plans and Scope More than half of SMBs do not plan to diversify (64%) or narrow (74%) the scope of their business next year suggests business as usual in 2012 Do you have plans to diversify your business in 2012? Do you have plans to narrow your business scope in 2012? I don t know 17% Yes 14% I don t know 12% Yes 19% No 64% No 74% 10

11 2012: Business Performance More than half (64%) of SMBs have optimistic or neutral business performance projections for 2012, and a large majority (60%) will focus on customer/client growth How do you feel about your business performance heading into 2012? Which areas will you focus on improving in 2012? (Select all that apply) 21% 7% 8% 32% Customer or client growth Customer or client retention Product or service expansion 21% 38% 60% Budget constraints 21% 32% Communications/Marketing/PR Technology innovations 21% 15% Local competition Internal employee retention Very Optimistic (8%) Optimistic (32%) Internal employee growth Geographic expansion 9% Neutral/ Don't Know (32%) Pessimistic (21%) Other Very Pessimistic (7%) 0% 10% 20% 30% 40% 50% 60% 70% 11

12 2012: Investments The top three common business sectors SMBs plan to invest in are projected to be marketing, sales and technology/it In which areas will your business invest money in 2012? (Select all that apply) Marketing Sales Technology/IT Product / Service Expansion None, will not invest Education Capital Improvements Staffing Communications Product Research and Development Physical Infrastructure Office Space Other, please specify Land 4% 5% 8% 9% 19% 20% 22% 28% 35% 0% 5% 10% 15% 20% 25% 30% 35% 12

13 2012: Employee Growth Nearly two thirds (65%) of SMBs do not plan to hire more employees in 2012 as compared to Of those hiring, the majority plan to add 1-5 employees Does your business plan on hiring more employees in 2012 than in 2011? How many employees will your business hire in 2012? (Include P/T, F/T and temp employment) Yes 20% I don t know 15% No 65% 14% 4% 44% 19% 1 to 5 (44%) 6 to 10 (19%) 11 to 25 () 26 to 50 (14%) 51 to 100 (4%) Over 100 () 13

14 2012: Customers The top three ways SMBs plan to attract customers in 2012 are word-of-mouth, repeat business and advertising/marketing What will be your primary source of getting customers in 2012? (Select one) 4% 25% 22% 25% Word-of-mouth (25%) Repeat business (25%) Advertising and marketing (22%) Networking () Social media () Other (4%) 14

15 2012: Social Media Next year, SMBs are evenly split on whether or not they will use social media tools Will your company will use social media in 2012? I don't know 20% Yes 40% No 40% 15

16 2012: Social Media The primary reason cited by SMBs for using social media is affordability. The primary reason cited by SMBs for not using social media is perceived lack of value Primary reasons for using (Select all that apply) It is affordable 6 Our customers use social media 5 This type of word-of-mouth is a great referral source I am personally comfortable using social media Our business promotes social media in other types of marketing There s a strong measurable impact on our business Other 3% 20% 23% 44% 55% 0% 10% 20% 30% 40% 50% 60% 70% Primary reasons for NOT using (Select all that apply) I don t see the value 41% Our business relies on word-of-mouth as a referral source 37% Our customers don t use social media 2 I am personally uncomfortable using social media 25% There s no way to measure the impact on our business 14% Our business invests in other types of marketing 12% It is not affordable Other 7% 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 16

17 2012: Social Media and Generational Use Of those surveyed, the respondents age correlates with their planned use of social media tools in Planned Social Media Usage & Age of Respondent 18 to 24 years old 5% 2% 1% 25 to 34 years old 2 35 to 44 years old 24% 1 20% 45 to 54 years old 22% 23% 32% 55 to 64 years old 17% 2 17% 65 to 74 years old 5% 1 15% 75 or older 1% 5% Yes, we plan to use social media in 2012 No, we DO NOT plan to use social media in 2012 Don't Know 17

18 Demographics & Appendix 18

19 Top 10 Business Locations Breakdown of the top 10 states represented among respondents State Percentage California Florida 8% Illinois Texas New York 5% Pennsylvania 5% Ohio 4% Arizona 3% Georgia 3% Indiana 3% 19

20 Business Size / Decision-Makers Including yourself, how many are employed at your company? For which of the following would you consider yourself a primary decision maker? 5% 39% 5% 4% 27% 25% 2 1 (self-employed: 39%) 2 to 10 (25%) 11 to 25 () 26 to 50 () 51 to 100 () 101 to 250 () 251 to 500 (5%) 501 to 1,000 () Operations (27%) Administration (2) Communication/Marketing/Sales () Financial () Technology () Human Resources (5%) Research and Development (4%) 20

21 Respondent s Gender and Age % % % Female 50% Male 50% % % % Gender Percentage Male 50% Female 50% Age Range Percentage 25 or younger 8% % % % % Over 65 15% 21