BIA/Kelsey’s Steve Marshall on Understanding the Small-Business Advertiser
September 14, 2010 | Contributed by: Natalie Wuchenich
Steve Marshall, research director of BIA/Kelsey, offered his five high-level takeaways about the state of the Yellow Pages industry based on the group’s annual Local Commerce Monitor survey of local businesses.
Advertisers are restless. Research shows that small business ad spending is currently volatile, with spending down significantly—almost one-fourth—between July 2007 and Aug. 2009. Media usage levels by segment —including print directories, direct mail, Internet Yellow Pages, newspapers, and pay-per-click—are also in flux year-to-year. There is also a lot of movement with Yellow Pages advertisers placing ads in incumbent publishers’ print directories.
In With the New (Media). Small business use of digital media continues to overcome traditional media. Small businesses plan a major increase in their use of Web 2.0 features, including web video, social/blogs, user ratings/reviews. This is a result of more consumers turning to additional media for local commerce. In Q1 2007, consumers used 5.6 media sources when shopping for local products and services. In Q1 2010, this rose to 7.9—a substantial increase.
Not all Leads are Created Equal. Between 40-50% of revenue for small businesses annually comes from new customers, so they are very important. Small businesses continue to value calls and in-store visits as the most significant indications of ROI—more than online clicks, which are not yet seen as effective.
The SEM/SEO Seesaw. Local businesses are increasingly valuing SEO because of the broader evolution of websites into content ecosystems. Companies have a growing online portfolio that includes websites, social media channels (Facebook, Twitter), and other local media and websites. Content is king: is it important for SEO purposes that online content is regular and original.
Huge Variation Beneath the Surface. There are significant differences in how businesses spend on advertising. For example, businesses that have been around for just a few years spend a higher percentage (34%) of their ad budget online and in social media than older businesses (13%). Also, online ad spend by super verticals—for example, financial services, home/trade services, and professional services—varies significantly by type.
Steve closed by noting the importance of developing a deep understanding of the small business advertiser to determine what is driving their behavior.