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Business Development Articles

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Small Businesses’ Financial Outlook Falls

April 4th, 2013 ::

By Maria Valdez Haubrich

How are small businesses across the country feeling about their financial futures? According to the latest Capital One Small Business Barometer, not too positive. The study asked small business owners about their opinion of the current economy and their financial and business projections for the next six months.

 

In the most recent survey, conducted at the end of 2012, small businesses’ concerns about the future had risen, with more than one-fourth (26 percent) of small businesses polled saying they believe economic conditions will decline over the next six months. That’s a 12-point increase from Q3 2012. In addition, more than one-fourth (27 percent) of small business owners said their company’s financial position was worse than a year ago, up 11 points from the same time in 2011 and up 4 points from Q3 2012.

Given these concerns, it’s not surprising that just one-fourth of small businesses say they plan to hire in the next six months. “Among the small businesses we’ve surveyed, we are still seeing significant caution about prospects for growth, as well as hesitancy about making investments,” said Jon Witter, President of Direct, Consumer and Small Business Banking at Capital One, in announcing the survey. “Looking ahead, confidence in the economic environment will be key.”

As to the overall economy, the outlook isn’t great. While 44 percent of the small businesses surveyed believe economic conditions are holding steady, that’s a drop of 7 points from the same time in 2011. Fewer than one- third (28 percent) expect economic conditions to improve in the next six months, and the same percentage expect conditions to get worse.

The national Small Business Outlook index, which ranks business prospects for the next six months on a scale of significantly worse (1) to significantly better (10), continued its downward trend throughout 2012, hitting 5.6 in the most recent survey. What factors matter most to small business owners’ outlooks? Price margins and profitability topped the list, followed by cash flow and fuel prices.

Small business owners are keeping a firm grip on their budgets, with just 13 percent planning to increase spending in the next six months—down from 20 percent who planned to increase spending at the end of 2011. In addition, the number planning to cut spending hit 25 percent—the highest it’s been in two years, and up 8 points from the Q3 2012 survey.

With limited plans to increase spending, it’s not surprising that more than two-thirds (68 percent) of entrepreneurs polled don’t plan to hire in the next six months, either.

How do these opinions relate to your own outlook, both for your business and for the economy as a whole?  

Image by Flickr user Michael David Pedersen (Creative Commons)

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Posted in Business Development, Small Business, small business, Workforce | 1 Comment »

The Future of Online Retailing

April 1st, 2013 ::

By Rieva Lesonsky

Spurred by the rapid adoption of mobile devices like tablets and smartphones, as well as by major retailers’ investment in their websites, ecommerce sales in the U.S. are projected to rise from $231 billion last year to $262 billion this year—an increase of 13 percent–according to the latest forecasts from market research firm Forrester. Three product categories account for one-third of that total: apparel and accessories, consumer electronics and computer hardware.

Ecommerce currently accounts for some 8 percent of overall U.S. retail sales (or 11 percent, if grocery sales are excluded). Growth in online retail sales is projected to outpace the growth of traditional retail sales in the next five years. By 2017, total ecommerce sales in the U.S. should hit $370 billion.

Forrester says the increased use of smartphones and tablets is a major factor powering ecommerce growth. With over 50 percent of U.S. online users owning smartphones, many smartphone owners use any spare moment to go online. As a result, people are spending more time overall online than they would if they had to go to their PC or laptop to shop—and that means more browsing, shopping and purchasing.

Another driver behind ecommerce growth is that major retailers are rapidly making investments in their ecommerce divisions in order to better integrate their in-store and online shopping experiences. Even customers who head to a brick-and-mortar store now often end up buying merchandise online within the store, or using smartphones to find the same products elsewhere and order them online.

Surprisingly, new shoppers coming online for the first time are not a major factor in the growth of ecommerce. Just 4 million people are projected to buy online for the first time this year. Instead, growth is coming because people who are already comfortable with online shopping are now spending more money online, ordering more often, and buying a wider range of products from a variety of sites. Forrester says online shoppers typically become comfortable with ecommerce by purchasing low-risk items such as downloadable music or movies. Only then do they move up to more expensive purchases such as appliances or home furnishings.

Forrester’s report has some more good news, not just for ecommerce vendors but also for the economy as a whole: Ecommerce companies are powering employment growth. Currently, Forrester says, U.S. ecommerce businesses employ over 400,000 people, and that figure is expected to hit 500,000 by 2017.

Image by Flickr user Mosman Council (Creative Commons)

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Posted in Business Development, Marketing, Sales Process, sales process, Small Business, small business, Technology, Web Design | No Comments »

Hot Market: Indie Women

March 25th, 2013 ::

By Rieva Lesonsky

When you think of marketing to women, do you think of moms? Then you’re missing out on a huge and profitable target market of “indie women.” Age 27 and up, these single women are living without partners or kids, and pack a disproportionate amount of spending wallop, as MediaPost reports.

Currently, indie women account for 31 million or about one-third of all U.S. women over 18, and their numbers are increasing: There will be a projected 50 million indie women by 2035. What do you need to know about this powerful market?

Indie women have higher incomes than the average woman and spend $1 trillion each year, including:

  • $22 billion on vehicles (that’s five times more than “indie men” spend)
  • $20 billion on entertainment
  • $50 billion on food

Indie women watch more television than average women and are multi-screen users, meaning they frequently accompany TV-watching with a “second screen” such as the tablet, laptop or smartphone.

Indie woman are highly socially engaged online. They are 6 percent more likely than average women to  rely on online ratings and reviews, 12 percent more likely to report that friends and family routinely ask them for advice on health and nutrition advice, and 10 percent more likely to say they are frequently the first among their friends to purchase from a new brand or store.

Indie women are professional: They hold 59 percent of masters’ degrees and 52 percent of managerial positions.

What should you do to reach indie women?

  • Use social media. These women are key influencers and brand advocates, so engaging with them on social media can drive your success.
  • Treat them with respect. Indie women are successful on their own terms, so make sure your marketing reflects the fact that they’re happy with their lives and making their own decisions.
  • Know where they’re spending. Indie women are more likely to dine out, entertain at home and spend money on home décor and apparel than the average woman, making these potentially lucrative areas for your business to focus on.

NBCUniversal Integrated Media began studying the indie woman because this group does a lot of discretionary spending, but is not yet widely researched in demographic studies, making it an undiscovered marketing opportunity. You can learn more about this demographic by watching NBCUniversal’s Integrated Media group’s film about indie women here.

Image by Flickr user EpSos.de (Creative Commons)

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Posted in Business Development, Marketing, sales process, Small Business, small business, Social Media, social media | No Comments »

What Do Female Breadwinners Mean for Your Business?

March 22nd, 2013 ::

By Rieva Lesonsky

Are you trying to target women with your marketing message? Then you’d better be aware of a demographic that’s grown in power since the Great Recession took hold: breadwinning wives.

The Great Recession was dubbed a “mancession” by some due to the large numbers of men who lost their jobs. As a result, more women found themselves the main breadwinners of the family. But an end to the recession hasn’t meant an end to the trend, reports Marketing Daily.  In fact, research by Kristin Smith, a research assistant professor of sociology at the University of New Hampshire, shows that the rise of the female breadwinner could be a permanent change.

Smith analyzed earnings data from the U.S. Census Bureau and found that in 2007 (pre-recession), wives with jobs outside the home accounted for 44 percent of total family earnings. Between 2008 to 2009, that percentage climbed to 46–the biggest single-year gain in 23 years. In 2010 and 2011, it was at 47. Overall, from 1988 to 2011, wives’ share of earnings rose by 9 percent while husbands’ share dropped by 9 percent.

Women were more likely to contribute a higher percentage of the paycheck if they were married to men with a lower level of education. For instance, women whose husbands had a high school degree or below contributed 51 percent of total family earnings in 2011. Women whose husbands had a college degree contributed 42 percent.

During the recession (December 2007 – January 2010 in this study), America lost 8.7 million jobs, with most of them in construction, manufacturing and other male-dominated industries. At its peak in October 2009, men’s unemployment reached 11.2 percent while women’s was 8.7 percent.

Smith believes that the trend toward female breadwinners will not only continue, but strengthen even as the economy improves. Why? She believes families will still need to make up for lost time and restore diminished retirement accounts and savings. As a result, more women will stay in the work force. Smith’s report did not take into account emotional factors like fears and worry sparked by the recession; if you consider those factors, the staying power of the female breadwinner seems even more ensured.

What does this trend mean to you?

  • If your product or service has traditionally been marketed to the “head of the household” or breadwinner, keep in mind that role may have changed. You may need to tailor your message to suit women or both men and women.
  • Since women typically earn less than men even in the same jobs, female-breadwinner households will have tighter budgets. Reach out to them with marketing messages about value, savings and smart shopping.
  • If both spouses are working, time will be at a premium, so one way you can justify higher prices is by focusing on how your product or service saves precious time that can be better spent on more important things, like relaxation or family.

Image by Flickr user DonkeyHotey (Creative Commons)

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Posted in Business Development, Marketing, Sales Process, sales process, Small Business, small business | No Comments »

How Can You Get Affluent Consumers to Spend?

March 20th, 2013 ::

By Rieva Lesonsky

Unity Marketing’s latest Luxury Consumption Index, which measures the spending plans of affluent Americans, shows that after a surge of optimism in October leading up to the November 2012 election, wealthy consumers are getting cautious again. The LCI lost 19.4 points in January–its second biggest loss since the first quarter of 2008.

The LCI measures the optimism that affluent consumers feel about the state of the economy in general as well as their personal financial situation. Affluent consumers are defined as the top 20 percent of U.S. households based upon income; this demographic accounts for more than 40 percent of all consumer spending, so their plans are crucial to business growth.

“Affluent consumers are starting 2013 with a dismal view of the overall economy and their personal financial situation,” says Pam Danziger, president of Unity Marketing. Here’s a closer look:

  • Skeptical About Economy: Before the election, 37 percent of affluents felt the U.S. economy was improving, but in January, just 29 percent did. Although this is still higher than the 25 percent average throughout 2012, it’s not exactly a vote of confidence in the nation’s future.
  • Pulling in the Purse Strings: More than one-quarter (28 percent) of affluents say their spending on luxury will decline over the next 12 months; in October, just 18 percent said they planned to cut back.
  • Personally Pessimistic: The largest share of affluents since the recession believe they will be worse off financially 12 months from now. “Typically affluents are an optimistic bunch,” Danziger says. “However, in the latest survey nearly one-fourth (22 percent) predict that they will be worse off in the next 12 months as compared to today.” This is the highest this measure has been since the depths of the recession in 2008.

What does the poor outlook mean for your business? Tom Bodenberg, Unity Marketing’s chief consumer economist, offers this advice: Reposition luxury goods as a value proposition.

“That means to keep the luxury image and connotations (advertising creative, packaging, media and service), but communicate (in a very implied, almost one-to-one way) affordable pricing,” he explains.

Your goal, Bodenberg says, should be an “almost subliminal” positioning of value. “The current cultural climate can’t support showy displays of luxury,” Bodenberg warns. Affluents still want brands that offer quality and value, but they don’t want to trumpet the luxury factor—instead, they want to feel that they’re making smart buying decisions.

Image by Flickr user (Creative Commons)

 

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Posted in Business Development, Marketing, Sales Process, sales process, Small Business, small business | No Comments »

How to Reach Niche Markets on Social Media

March 15th, 2013 ::

By Rieva Lesonsky

If your small business is targeting niche markets such as specific minority groups, age groups or other demographics, it’s important to know what social media tools these individuals are likely to use. New research from the Pew Research Center’s Internet & American Life Project examined what social media networks are most popular with different user groups. Here’s what they found:

Overall, social media use is widespread. More than two-thirds (67 percent) of all Internet users use at least one social networking site. Those 18-29 are the most likely of any age group to do so (83 percent), but even among the 65-and-up age group, nearly one-third (32 percent) use social media. Women are more likely than men to use social media, and urban residents are more likely than rural Internet users to do so.

What sites are most popular? Pew took a look not only at the “biggies,” but also at some up-and-comers.

Facebook users

Facebook is still the most popular social networking platform, with two-thirds of online adults on the site.  Women are more likely than men to be Facebook users (72 percent vs. 62 percent), and the 18-29 age group is most likely to use it (86 percent).

Twitter users

Twitter is showing steady growth, with the percentage of Internet users who use this social media site doubling since November 2010, to 16 percent. People under 50, and especially those 18-29, are more likely to use Twitter. Urban residents are more likely than both suburban and rural residents to use Twitter. African-Americans are the most frequent users of Twitter, with 26 percent reporting they use it, compared to 14 percent of white Internet users and 19 percent of Hispanics.

Pinterest users

Overall, 15 percent of Internet users use Pinterest, but this site is especially  popular with the youngest cohort (18 to 29), those with higher educational attainment, and upper income consumers. Nearly a quarter (23 percent) of Internet users with household incomes between $50,000 and $74,999 use Pinterest; so do 18 percent of people with incomes of $75,000 or above. Women are five times as likely to use Pinterest as men (25 percent vs. 5 percent).

Instagram users

Photo-sharing site Instagram is popular with 13 percent of Internet users overall. Women and younger users (under 50) are the most likely to use it; so are urban dwellers, African-Americans and Hispanics.

Tumblr users

While Tumblr is still the least popular social networking site users were asked about—used by just 6 percent of Internet users—keep in mind that just a few years ago, Twitter had similar numbers. In addition, Tumblr is far more popular among younger users, with 13 percent of 18-to-29-year olds blogging on the site. However, Instagram, which offers similar photo-oriented functionality, has become twice as popular overall in a shorter period of time.

What do these stats mean for your business?

  • If you’re targeting younger customers, you definitely need to be on social media—and you need to be checking out the newest up-and-coming sites. Whether that’s Instagram, Tumblr or something even newer, take the time to explore it and see if your target customers are there.
  • No matter who you’re targeting, you probably need to be on Facebook. With even the 65-plus-crowd hanging out here, Facebook is a smart marketing tool for just about every consumer-oriented small business.
  • Trying to reach women or high-income customers? Get familiar with Pinterest, since a high proportion of those customers spend time there.

Image by Flickr user eldh (Creative Commons)

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Posted in Business Development, Generational Marketing, Marketing, Sales Process, sales process, Small Business, small business, Social Media, social media | 6 Comments »

What You Must Know About Marketing to Baby Boomers

March 13th, 2013 ::

By Rieva Lesonsky

As they enter their senior years, Baby Boomers are still one of the most powerful consumer demographics in the U.S. What do you need to know to target Boomers today? MediaPost recently spotlighted some research from Navigate Boomer Media on what Boomers are doing, buying and interested in. Here’s where the opportunities are:

Online Marketing

If you’re only marketing to Boomers in the newspaper or print media, you’re missing the boat. You might be surprised to learn that the average Boomer spends more time online than the average teenager (15 hours per week vs. 13 hours). Put your money into online advertising to reach this market.

Transition Time

Baby Boomers are currently experiencing huge life transitions as they enter their 50s and 60s. If you want to capture their emotions during these times, Navigate Boomer Media advises your marketing should include one or more of these three messages:

  1. We understand you.
  2. We make your life easier.
  3. We make your life better.

Wealth Transfer

Baby Boomers will be inheriting money from their parents and will spend it on luxuries including physical rejuvenation and health-related costs such as home gyms, trainers and spa visits; luxury travel; luxury cars (including Porsche, Mercedes and Corvette) and second homes.

Empty Nesters

As their children move out, Boomers will take advantage of the empty nest to pursue their passions, including traveling, pursuing education and volunteer opportunities, starting a business, and remodeling or redecorating the home, often including a home office. Many will also turn to pets (especially dogs) for companionship.

Boomers as Caregivers

With their parents living longer, many Boomers will find themselves in the unusual situation of caring for aging parents long past the time when prior generations were doing so. This creates opportunities for businesses that provide them with support, time off, or pampering to rejuvenate them to face the challenges of caregiving.

Divorce Means Change

For Boomers whose transition includes divorce, demands will include products and services to help them downsize their households and adapt to single life. Sales of condominiums and active adult communities will grow. Wealth management services will be in demand. Travel is popular with this group, with “girlfriend getaways” a hot commodity.

The Grandparent Life

Many Boomers are grandparents, and they’re ready to spend on travel with the grandkids (adventure or education-themed trips and cruises are popular). They also buy books and toys for their grandkids and start savings or college accounts for them.

Menopause and More

Menopausal Boomer women will seek products and services to help them learn about menopause, be comfortable and continue an active lifestyle. Information and education about menopause and solutions for its challenges will be a hot commodity.

How can your business market to Baby Boomers?

Image by Flickr user dannybirchall (Creative Commons)

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Posted in Business Development, Generational Marketing, Marketing, Sales Process, sales process, Small Business, small business | No Comments »

Web.com Small Business Toolkit: Mailigen’s Epic Free (Email Marketing)

March 11th, 2013 ::

Mailigen’s Epic Free

If you’re looking for a starter email marketing solution, Mailigen’s Epic Free email marketing solution lets small businesses have up to 5,000 subscribers before it charges a monthly fee. Create newsletters, signup forms and surveys from over 130 customizable templates. You’ll get real-time performance reports, plus, Mailigen integrates with Google Analytics. Mailigen’s branding is part of the emails, but if you ask them to remove it, they will. You can also post to your Facebook or Twitter account when you send out the emails and target your audience so subscribers get exactly the information they’re interested in.

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Posted in Business Development, Email Marketing, Marketing, Resources, Sales Process, sales process, Small Business, small business | No Comments »

Does Your Retail Business Need a Mobile App?

March 11th, 2013 ::

By Rieva Lesonsky

Does your small business need a mobile app? If you’re a retailer or etailer, maybe so. A new study from Flurry measured the time consumers spent using more than 1,800 iOS and Android shopping apps between December 2011 and December 2012.

The study divided apps into five categories:

  1. Retailer Apps (such as Walmart, Target, Macy’s, Victoria’s Secret, Gap, Saks 5th Avenue)
  2. Price Comparison Apps (such as RedLaser and Grocery iQ)
  3. Purchase Assistant Apps (such as ShopSavvy and ShopAdvisor)
  4. Online Marketplace Apps (such as eBay and Amazon)
  5. Daily Deals Apps (such as Groupon and Living Social)

Time spent on all five types of apps grew quite a bit, but time spent with retailer apps skyrocketed the most (by 525 percent). That percentage far outstrips the overall growth in the use of both shopping apps (274 percent) and apps as a whole (132 percent).

The time consumers spent with Price Comparison and Purchase Assistant apps also grew significantly, by 247 percent and 228 percent, respectively. Even Online Marketplace and Daily Deals apps grew, though at 178 percent and 126 percent, respectively, the growth rate was far less.

The big winner in the growth of app use is retailers. Overall, in 2012 consumers spent 27 percent of app use time on retail apps (up from 15 percent in 2011). By contrast, the share of time spent on Daily Deals shrank from 20% in 2011 to 13% in 2012, and the share of time spent on Online Marketplace apps decreased from 25% in 2011 to 20% in 2012.

Flurry concludes that smart retailers will begin examining their customer relationships through the “mobile-first” lens. The rise in mobile app use—and especially in retail app use—shows that it’s more important than ever to extend your customer relationships to a variety of channels.

Instead of focusing solely on getting customers into your store—or even onto your website—you need to also focus on attracting them via their mobile devices. “In the new mobile app economy, devices are always with you, always on and always connected,” Flurry writes. Yes, 95 percent of sales still occur in physical stores, but mobile allows you to intercept customers in store aisles and affect their purchasing decisions before they ever reach the cash register. Consider tapping into apps that let customers save their credit card info, apps that let them ship an item to their homes, or apps that let them scan an item with their phones to place an order.

How are you using mobile apps to enhance your customers’ retail and e-tail experience?

Image by Flickr user Dru Bloomfield – At Home in Scottsdale (Creative Commons)

 

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Posted in Business Development, Customer Service, Marketing, Sales Process, sales process, Small Business, small business, Technology, Web Design | No Comments »

Web.com Small Business Toolkit: BizShark (Search Tool)

March 8th, 2013 ::

BizShark

Finding business contacts online can feel like looking for a needle in a haystack, but Bizshark makes it easy. BizShark is a new B2B search platform that targets small businesses by offering an affordable way to search for contacts without a bunch of complex analytics. The BizShark database has roughly 40 million business contacts and more than 14 million company listings, and is searchable by individual and company name as well as by email address. The easy-to-read contact profiles include title, department, phone number and email information. Additional features include company revenue estimates and built-in company directories by department and geographical location.

 

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