Small Business Owners Are Earning More and Spending More on Marketing

A new survey reveals that about half of small businesses project higher revenue this year, prompting them to boost spending on marketing

Small Business Owners
(Image: iStock/designer491)

U.S. small businesses have a rosy outlook, when it comes to projected revenue growth. Perhaps, the popular Good Times theme song made famous by the disco band Chic could also be a fitting theme song for the nation’s small business owners nowadays.

A new survey by Clutch reveals that 59% of small business owners expect their revenue to grow this year. And, more confident, they will bring in extra money in the future; small business owners plan to spend more on marketing and advertising this year than last year.

Clutch’s 2017 Small Business Digital Marketing Survey consisted of 350 small business owners and managers.  Those surveyed are leaders in their businesses, initiating trends in digital marketing and cultivating new marketing jobs.

A Washington, D.C.-based ratings and review firm, Clutch defined a firm with fewer than 500 employees as a small business. Forty percent of respondents worked at a business with 10 employees or less. Forty-six percent of the small business survey participants had 2016 revenue less than $1 million.

Forty-nine percent of entrepreneurs plan to spend more on digital marketing to boost sales and brand recognition this year over last year. Thirty-six percent of small businesses aim to boost their marketing budget by 11% to 30%. Some 68% of respondents reported spending less than $100,000 on marketing in 2016, with 41% shelling out less than $10,000.

When it comes to digital marketing channels, 58% of small businesses plan to invest more this year in paid social media, 56% in a website, 39% in email marketing, and 35% in search engine optimization (SEO).  That process essentially is a methodology used to boost the number of visitors to a website by obtaining an elevated position in the search results page of a search engine. Those engines could include the likes of Google, Yahoo, and Bing, to name a few.

Out of the small businesses surveyed, 335 have in-house digital marketing staff.  Forty-nine percent rely on one or two employees to produce digital marketing campaigns. Eighty percent of those surveyed work with one or more digital marketing agencies, while 43% work with one or two agencies.

When it comes to new marketing strategies, 17% of small businesses plan to invest in virtual reality and augmented reality, while 29% plan to spend money on marketing videos.

In 2017, small business owners should focus on paid social media campaigns and be optimizing their websites for local searches, says Michelle Delgado, research analyst at Clutch and author of the new report.

“In addition to these standard practices, small business owners are eager to experiment with videos, which come in a wide range of price points,” said Delgado. “Whether you create an Instagram story, or a highly produced video advertisement for your business, video is quickly becoming an essential marketing strategy.”

 


Jeffrey McKinney is a long-time freelance business writer and reporter, contributing to Black Enterprise magazine for several years on a broad range of business and financial topics.