More business management tools than ever … yet many small businesses stick with spreadsheets and other “outdated” processes.

February 23, 2017February 23, 2017 Phillip Nones Business, Sales Connected Small Business Report, CRM, Customer Information Management, customer service, Harris Poll, SalesForce Research, Small Business

It seems like there’s never been more information – and technologically based solutions — available concerning marketing, sales and other business operations support than there is today.

Just go online, type in a few keywords, and watch how many hundreds – in some cases thousands – of web links pop up. And there’s a lot that’s really quite beneficial and instructive.

But even with such a smorgasbord of information – much of it available free of charge – it can actually be overwhelming for owners and managers of small businesses.

Maybe it’s “analysis paralysis.” Or perhaps something more fundamental.

Typically, small business owners wear many hats inside their companies — a jack of all trades and master of maybe just one or two.

The same dynamics are at work in the field of customer information management as well. Last year, the Harris Poll surveyed a group of small business owners on their practices in this realm, and the results were published this past December by SalesForce Research in its 2016 Connected Small Business Report.

The results showed that small business owners continue to rely on outdated processes such as spreadsheets (or even paper-based systems) to store and track their customer information.

As for more modern (digital) tools like CRM and analytics, it isn’t happening much at all.

For starters, more than 80% of the companies surveyed by Harris reported that they do not have any dedicated IT staff – so it comes as no surprise that nearly three-fourths of company owners are the ones responsible for making their companies’ technology buying decisions.

Here’s what the survey found:

Small business owner typically makes technology buying decisions: ~72% of respondents
A co-owner or business partner: ~28%
Chief technology officer, chief information officer or head of IT: ~4%
An outside vendor: ~3%
Chief financial officer: ~2%

Note: Tally above exceeds 100% due to multiple mentions.

Where is the technology spend going? Hardware expenses are the most significant, with financial software second in importance:

Hardware: ~46% of respondents cite as the majority of their annual technology spend
Financial software (e.g., accounting/bookkeeping and bill payment): ~33%
Productivity software (e.g., Microsoft Office): ~26%
Internet hosting/ISP services: ~22%
POS/POP software: ~20%
Telecommunications/VoIP: ~15%

E-mail and spreadsheet tools continue to dominate in terms of customer information management, and quite a few of the companies surveyed are still working with paper-based systems:

E-mail tools (Outlook, Apple, Gmail contact, etc.): ~44%
Spreadsheets (Excel, etc.): ~41%
Written customer ledger: ~34%
Basic database (e.g., Access, Quickbase): ~29%
CRM system or app (housed within the business): ~20%
Other paper-based practices: ~15%
CRM system or app (cloud-based): ~12%

And when it comes to customer service, small businesses rely on three major practices:

Direct phone contacts with customers: ~51%
Direct e-mail communication with customers: ~47%
Social media interaction: ~32%

So on balance, it looks as though most small business aren’t really tapping into many of the “new tools” that could help them manage their businesses and their sales, marketing and customer retention programs better.

It may be a similar dynamic to what we see with small investors. Today there’s more investment information available than ever before – and it’s right at people’s fingertips, too. Even so, often the result is … to do nothing. Whatever the choices are, so many investors make no changes at all to their investment portfolio.

And just like there are financial planners to assist the timid investor, there are plenty of business consultants ready and willing to guide small business owners in ramping up their operations.

But that’s another entire discussion, of course.

To access a copy of the 2016 Connected Small Business Report, click here.

America’s small businesses: Quite bullish on 2015 … but with no thanks to the government.

February 2, 2015February 2, 2015 Phillip Nones Banking, Business, Economics, Employment, Government 2015 Business, Business, Business Conditions, Business Outlook, Economic Outlook, Endurance International Group, Small Business

Recent reports on economic activity appear to show a continuation of a rather wobbly recovery of the U.S. economy since coming out of the Great Recession.

It’s a repeating pattern of one quarter of strong growth followed by the next one with weaker indices — sometimes with the stats from earlier quarters revised downward.

Still, things are still better for the U.S. economy as compared to many others around the world.

America’s small businesses appear to feel similarly about the U.S. economy. Their perspective may be even more positive, in fact.

Illustrating this perspective, a January 2015 survey of ~850 U.S. businesses (ones that employ ten or fewer full-time or part-time workers) finds small business owners having a pretty bullish outlook on the year ahead.

In a survey conducted by web hosting company Endurance International Group (formerly Bizland), two-thirds of the respondents reported positive prospects for their businesses for 2015:

General business outlook is very positive: ~26% of respondents
Generally positive outlook: ~45%
Neutral outlook: ~25%
Negative outlook: ~5%

These findings align quite neatly with how these business owners see 2015 as compared to 2014’s performance:

2015 will be positive compared to 2014: ~66% of respondents
2015 will be about the same: ~29%
2015 will be negative compared to 2014: ~5%

But … these positive impressions happen with no thanks to the government. When asked if they felt that the U.S. Congress is effective in addressing the issues that are important to small businesses, a whopping 87% gave thumbs-down.

Even the changes in Congressional leadership that came about as a result of the 2014 midterm elections have done little to improve the perceptions of these business owners, as ~69% do not believe that the new leadership in Congress will be any more effective in addressing small business issues in 2015.

And what are those issues that are so important to small businesses?

They’re the usual things: business taxes first and foremost … followed by the ability to obtain financing.

The next tier of issues includes the ability to hire workers with the appropriate skills, along with the ongoing healthcare coverage challenges.

Any other issues are basically just an asterisk at the bottom of the page …

More details on the survey results can be found here.

America’s Smallest Businesses Get Hands-On with Digital Marketing

November 17, 2014November 17, 2014 Phillip Nones Advertising, Business, Marketing Communications, Media, Social Media DIY Marketing, Insight by Design, Marcomm, marketing communications, Online Advertising, Small Business, Small Business Marketing, Social Media, Social Media Marketing, Social Media Platforms, Vistaprint, Web Development, Webs, Websites

As more MarComm activities increasingly migrate to the web and to social media platforms, small businesses are increasingly taking a DIY approach in their marketing programs.

That’s the major takeaway from a survey of nearly 2,600 small business owners conducted by Insight By Design for Webs, a subsidiary of Vistaprint.

For purposes of the study, small businesses were defined as those having 10 or fewer employees. The results of the field survey, which was conducted in the spring of 2014, were published in Vistaprint’s 2014 Digital Usage Study.

Two-thirds of the small business respondents reported that they are actively using digital products to market their businesses. Of those who have websites for their business, nearly 60% of them created their own websites using DIY tools.

An even larger proportion — 80% — act as their own webmasters.

Small businesses consider customer acquisition and generating new customer leads as the most important reasons for maintaining a web presence.

In the social media realm, Facebook is the most popular platform for promoting small businesses — so said nearly 90% of the survey respondents who are active in social media marketing.

Facebook is viewed as not only a vehicle for building brand awareness and acquiring new customers, but also for building a network of followers and engaging with them over time.

The survey’s respondents reported that all of the other major social platforms lag far behind Facebook in importance:

Facebook: ~88% consider it to be a highly important social media channel for their business
LinkedIn: ~39%
Twitter: ~31%
Google+: ~22%
Pinterest: ~20%
YouTube: ~17%

In line with its perceived importance as a marketing channel, about two-thirds of businesses that have Facebook business profiles are also engaged with paid advertising campaigns on the social platform — or are considering doing so.

No question, small businesses have concluded that social media marketing is the best way for them to create brand awareness and expand their reach in a very low-cost yet effective manner. So don’t look for any slowdown in the adoption of social strategies going forward.

Companies Continue to Increase their Investment in Social Media

May 18, 2014May 19, 2014 Phillip Nones Advertising, Branding, Business, Uncategorized Advertising, Business, marketing, Promo, Small Business, SMB, SMMU, Social Media, Social Media Marketing University

Social media may have its share of nettlesome issues … but that doesn’t mean companies aren’t spending more effort and energy on these platforms.

To illustrate, a new online survey of ~1,060 business owners, senior management personnel and social strategists that was conducted in April 2014 by Social Media Marketing University finds that a clear majority of companies are investing more time and/or dollar resources on social media as compared to a year ago.

And three-fourths feel that this investment is worth it.

Here are some of the SMMU survey’s key findings:

~74% of companies are devoting more time to social media.

~54% are spending more dollars on social media.

Nearly 70% are managing four or more social profiles.

The most significant expenditures for social media programs fall into these four categories:

Compensation of in-house staff: ~37% of all social media program expenditures

Social media advertising: ~18% of program expenditures

Compensation of external staff: ~10% of expenditures

Content development: ~7% of expenditures

According to the SMMU survey, smaller businesses – those with fewer than 50 employees – face the biggest challenge in terms of the increased time and cost commitments to social media.

As SMMU Principal John Souza puts it:

“Because many small businesses don’t have the skill-set or the staff to properly manage social media, they are outsourcing their social, or spending an excessive amount of time on tasks as they learn social by trial-and-error.”

Not surprisingly, having some focused training on the “how-to” of social media can make a pretty big difference in the effectiveness of the people charged with planning and carrying out a company’s social media program.

The question is how many businesses actually feel the need for such training, seeing as how some of the recent press about social platforms hasn’t been all that positive.

The answer, based on my own personal interaction with numerous small and medium-sized firms is … not very many of them.

e-Invoicing: Losing Luster … or Wave of the Future?

March 2, 2014March 3, 2014 Phillip Nones Banking, Business, Uncategorized Accounting, Bank of America, Banking, Barlow Research, Bill.com, Business, Chase, Donna Arce, e-Invoicing, electronic invoices, Finance, Nones, PayPal, Rene Lacerte, Small Business, Wells Farto

What’s happening with e-invoicing support services for small businesses these days?

Minneapolis, MN-based financial services industry market research firm Barlow Research Associates, Inc. reported in January 2014 that two of the three large banking institutions that had been offering e-invoicing services have now retired those programs.

Indeed, you won’t find mention of them anywhere on their small business online banking websites.

Donna Arce, Barlow Research Associates — Donna Arce

According to Donna Arce, a Barlow Research client executive, both Chase and Wells Fargo dropped e-invoicing in 2013, making Bank of America the only one of the nation’s 14 top banks still offering this service. (Existing e-invoicing customers at Chase remain grandfathered in … for now.)

Reportedly, the reason behind the elimination of e-invoicing services was low usage.

But was this usage a function of low demand … or was it actually the result of limited market availability?

After all, Arce reports that overall invoice volumes are notable. For the typical small business enterprise, approximately 75 paper invoices and 10 electronic invoices are generated in any given month.

In the middle market segment, the volume of invoices is quite a bit higher: Those companies average just over 1,250 paper invoices and more than 250 electronic invoices in the average month.

For answers to the question about inherent e-invoicing demand, we can look to PayPal, one of several non-bank providers of e-invoicing services.

According to Chris Morse, a PayPal spokesperson, “millions of users” have accessed company’s online invoicing services – particularly since 2011 when the product was redesigned with more robust functionality and features.

For an analyst’s column she wrote on the topic, Barlow Research’s Donna Arce reported on remarks made by René Lacerte, founder and CEO of invoice management firm Bill.com, on the elements that are essential for making sure that e-invoicing is a viable solution for business owners.

Quoting Lacerte:

“Working in an entirely online environment is not realistic for many businesses, [which] need a receivables solution that will track and manage both paper-based and electronic invoices and payments in one system.

“Integration with accounting software is key to businesses adopting any financial management tool, including e-invoicing. Without integration, businesses must re-key data from one system to another, which is both time-consuming and can be fraught with errors.

“Issuing the invoicing and accepting payment are just part of the overall receivables process … The ability to collaborate with customers via a portal where invoices can be referenced, documents shared and notes exchanged, dramatically reduces the time businesses spend managing these inquiries.”

The PayPal approach is quite flexible in terms of the payment options for the recipient of the invoice. Choices include its own PayPal bill payment option, along with credit and debit card payments as alternatives.

Contrast this with Bank of America, which requires the recipient to log on to a payment center, agree to terms, and then upload account information to make a payment – debit and credit cards not accepted.

Contrasting PayPal and the approach of the commercial banks, is it any wonder that the one is experiencing growth … while the others have seen low usage?

Of course, there’s also the issue of fees charged for e-invoicing services. PayPal’s fee structure is different than how the commercial banks have charged for services, in that a portion of PayPal’s fee is based on a percentage of the transaction value (currently around 3%). Depending on each company’s individual characteristics, that pricing model may or may not be the most lucrative for users.

Bottom-line, it’s clear that e-invoicing isn’t a dying service. But how flexibly it’s presented – and the degree to which it can actually reduce inherently labor-intensive in-house administrative activities – spells the difference between its success or failure as a business service.

In other words … the difference between PayPal and the giant commercial banks.