As part of the ritual of examining local commerce and SMB Saas strategies, Localogy goes right to the source: SMBs themselves. How do they feel about marketing and operational software? What features do they want? And how has their hunger changed in a post-pandemic world? This is all a moving target.
Localogy’s Modern Commerce Monitor (MCM) answers these and other questions across the SMB SaaS product set, which we preview in this Benchmark Bytes series. And we recently entered a new chapter of this series, with highlights from the latest wave (8.0) of Modern Commerce Monitor.
After examining SMB Saas top areas of improvement, we switch gears to look at the degree to which SMBs encounter in-person sales reps. Are they being called on IRL to buy marketing and operational software? Though this activity plummeted during Covid, there are signs that it’s returning.
Data Dive
– Diving right in, SMBs have reported a clear uptick in face-to-face software sales encounters. This is consistent across a number of functional areas.
– The category seeing the greatest instances of in-person sales (40 percent of respondents) is point of sale and payment processing.
– This stands to reason as it’s a core SMB need with universal applicability and a decent pace of innovation and upgrade cycles.
– Furthermore, there’s still headroom in this market as a large portion of SMBs still use legacy or analog systems.
– This category also shows ample momentum, up from 35 percent of survey responses in Wave 7 and 30 percent in Wave 6.
– Next on the list is communication & technology, where 36 percent of SMBs report in-person sales encounters.
– Like POS & payments above, this is a fairly horizontal and universally applicable SaaS category, so it’s not surprising that it’s high on the list.
– Coming in third on the list is finance & operations solutions at 32 percent of survey responses.
– This includes everything from bookkeeping software like Quickbooks to inventory management. It does not include payroll (tracked separately as shown below).
– Like the above “horizontal” functions, this is likewise a pervasive and broadly-applicable software category
– Further down the list are supply chain services (30 percent), CRM (30 percent), payroll & HR (28 percent), and marketing & advertising (28 percent).
– All of these categories are up from the last survey wave, with some categories seeing considerable growth. CRM for example is at 30 percent of responses, up from 25 percent in Wave 7 and 20 percent in Wave 6.
– This will continue to be a moving target and we’ll see what the next wave uncovers in both sheer adoption numbers, and continued trending over time.
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Long-Tail Opportunity
Stepping back, SMB online marketing – as well as operational and fintech tools – continues to grow rapidly. SMB SaaS startups and online service providers are correspondingly thriving as it continues to grow as a leading subsector of the broader SaaS universe. There’s a long-tail opportunity at play.
Meanwhile, new SMB SaaS users could represent permanent adopters – a concept that accelerated in the Covid era as SMBs were forced into digital transformation. This sent them into the arms of SaaS providers (where many have stayed) to accomplish a range of marketing and operational functions.
We’ll return in the next installment to go deeper into Localogy original survey research. That will include SMB goals and success factors. Let us know what additional insights jump out at you from the above data, and stay tuned for more breakdowns in our Benchmark Bytes series.
