By Claire West
A new survey of small and medium enterprises (SMEs) from across the UK suggests that while a large majority expect an economic downturn in 2008, very few are planning accordingly, and those that are will drop traditional marketing in favour of online options when times are hard.
The research, carried out across 175 small and medium sized businesses by
marketing experts New Brand Vision Group (www.newbrandvision.com) asked business owners and senior management for their views on a range of business, economic and marketing matters.
The survey also asked for views on the current fashion for social networking and blogging to be employed as part of the marketing mix, and canvassed opinions on the most influential brand of 2008, and the best and worst of current advertising campaigns.
KEY FINDINGS (full survey results below)
• Over two-thirds of SME businesses expect an economic downturn in 2008
• If recession hits, small businesses in particular will abandon traditional advertising in favour of online options
• Perhaps surprisingly, SMEs see direct mail as offering the best return on investment of all their marketing spend
• Larger businesses see their lowest return on investment (ROI) from search engine optimisation, pay-per-click and online banner advertising
• Only 11% of businesses use social networking for B2B marketing, and even fewer use it for B2C communications
• Two thirds of businesses think blogs are overrated as marketing tools
• Almost half of businesses haven’t updated their website in the last month, despite ‘website updates’ being cited as one of the most successful marketing tools available
• Marks & Spencer voted best advertising campaign — but also runner-up as worst advertising campaign!
Commenting on the results, Ben Harris, Managing Director of New Brand Vision Group, who carried out the research, says the results should be taken as a warning by many small and medium sized businesses, and calls on them to take action:
“Many SMEs will not have been in business during the last recession and won’t anticipate how they could be affected. It’s worrying that with so many firms expecting a downturn, so few are actually taking steps to plan for it.
This ‘wait and see’ approach may weaken their position if and when a downturn does take hold. Businesses should be armed and ready with their marketing and other business materials prepared, so if the hard times do hit they can immediately become proactive in generating new business. Being prepared is competitively smart.
“I’m surprised that despite increasing spends on online marketing by many companies; our survey shows that few SME businesses are making it pay. It may be that unlike traditional advertising, when the work goes in prior to campaign launch, online marketing often requires the bulk of the effort during the campaign. SMEs should persist, as well as being aware that their websites must accurately reflect the quality of their products and services.”
Yahoo! and Fresh Business Thinking are running monthly one-day Internet Masterclasses for business owners, directors and entrepreneurs who want to:
• get better search engine rankings
• understand the importance of ‘links’
• learn about pay per click advertising
• increase their web site traffic
• make more sales
• understand what’s coming next
These one-day Masterclasses are taking place at the Yahoo! head office in London’s Shaftesbury Avenue and feature expert independent speakers.
If you want to jump start your web site traffic and sales then you should register early to secure your place as these Intensive workshops are limited to 60 delegates.
Why You Should Attend
The findings in detail: Businesses expect economic downturn
Do you anticipate an economic downturn in 2008?
• Yes: 71.8%
• No: 28.2%
Have you rewritten or adapted your marketing plan to allow for an economic downturn?
• Yes: 27.7%
• No: 72.3%
Do you believe the business adage of spending your way out of recession?
• Yes: 29.9%
• No 70.1%
In the event of an economic downturn, do you expect your company to be
spending more or less on marketing?
• More: 16.9%
• Less: 21.5%
• No change: 61.6%
If budgets are tight, which do you think are the most effective marketing
• Top 3: Website update, Search Engine Optimisation, Direct mail
• Bottom 3: Traditional advertising (TV/Radio/Press), Brochure update, Exhibitions
Dramatically increase your ability to drive customers to your web site
Marketing: Successes and Failures
A series of questions aimed to discover what marketing strategies businesses
were currently undertaking and which provided greatest return on investment
(ROI) for them.
What were the main areas of marketing activity for your business in 2007?
• Top 3: Website update, Direct mail, PR
• Bottom 3: Online banner advertising, Field marketing, online networks
If you work in an SME, what marketing activity provides your best return on
• Top 3: Website update, Direct mail, PR
• Bottom 3: Online banner advertising, Exhibitions, online networks
If you work in a larger business, what marketing activity provides your best
return on investment?
• Top 3: traditional advertising, direct mail, website updates
• Bottom 3: Search engine optimisation, pay-per-click advertising, online banner advertising
Social Networking, Blogs and websites
Are social networks (Facebook, YouTube, Bebo etc) part of your marketing
• Yes — for B2B Marketing: 11.3%
• Yes — for B2C Marketing: 10.7%
• No — but planning to add it to the mix in 2008: 16.9%
• No – and no plans to start: 61.1%
Are blogs a useful marketing tool or overrated?
• Useful: 33.3%
• Overrated: 66.7%[/b]
When was the content of your website last updated?
• In the last hour: 10.7%
• In the last 24 hours: 16.4%
• In the last week: 25.4%
• In the last month: 18.1%
• In the last year: 15.3%
• Over a year ago: 14.1%
Favourite and most influential brands and adverts
On a lighter note, participants were asked to name the most influential
brand for 2008 and also the best and worst current advertising campaign.
Which brand do you think will have most impact in the UK in 2008?
• Top 5: Beijing Olympics, London 2012, Virgin Money, Barack Obama, Apple, The Conservative Party
What’s the best advertising/marketing campaign currently running in the UK?
• Top 3: Marks & Spencer, Honda, Cadbury’s Gorilla
What’s the worst advertising/marketing campaign currently running in the UK?
• Top 3: The Halifax, Slimfast, Marks & Spencer
Internet Marketing is Cost-effective and measurable
Although turbulence in the financial markets is causing some concern one thing is for certain.
Internet Marketing is still going strong!
Why? – Because Internet Marketing sends relevant buyers to your web site, it is cost-effective and it is measurable.
Search using services such as Google or Yahoo! is undoubtedly the most important development in marketing in the last ten years.
The Internet has changed the way we do business — forever! But the realities of the web can be harsh especially as the goalposts are changing daily and most businesses don’t know what they don’t know.