In our flagship State of SMB report, we track and trend the needs of small businesses as they navigate changing customer expectations, new technology, spending ability, and scaling their workforce, among other key operational and promotional activities.
While this information is important to our members, partners, and the industry at large in more “normal” years, our Modern Commerce Monitor™ has taken on a very different meaning in the wake of COVID-19. With this added importance we will have released 4 waves of the MCM this year.
Throughout the year so far, we have witnessed the data state the obvious in terms of state shutdowns, mandates by industry, and their impact on small business operations. But our reporting also allowed us to dive deeper into the mind of the small business owner, better understand their plight, and help to align our members accordingly.
In our latest MCM Wave-IV, we are seeing the work of agencies, brands, and SaaS technology leaders like yourself in the market – supporting small businesses with new and enhanced product offerings, training, and education, made even more available thanks to re-structured pricing and offerings. Let’s break down the findings with respect to Operations, Sales + Marketing, and Planning.
Necessary Shifts in Small Business Operations
Operational changes have largely been driven by workforce changes – as 48% of businesses are operating with a skeleton crew due to layoffs or furloughed employees. Those that have maintained staff are attempting to do so as remotely as possible which has brought on the need for new technology. Our findings indicate that a whopping 77% of business owners have remote workers during the pandemic. To manage this new remote workforce, 33% of open businesses have invested in new technology during the pandemic.
So what are they investing in?
- 52% purchased productivity and operational software
- 50% leveraged communication software
- 41% implemented document management software
The New Sales Cycle
Because small businesses are under the gun to make these changes and adoptions quickly, the old timeline and process for decision-making by the client and sales funnel nurturing by the provider is out the window. Urgency is still the name of the game and we are seeing 42% of business owners purchase online services directly from the provider’s website. Any other method of sales research and interaction – from the use of online marketplaces, recommendations from colleagues, or even advertising – hover between 13 and 16%.
But there is hope for the 2019 sales cycle!
While business decisions were made directly and with urgency, about 60% of purchases were made from a company these small businesses had conducted business with before. This illustrates the impact and continued need for long-tail marketing and sales outreach, as well as the revenue-generating opportunities, abound in product enhancements and additions.
Driving Toward the Ultimate All-In-One
Never before have we witnessed such a boom of innovation in the form of new product and services launches in such a short period of time. In May we took a look at how our members and partners are pivoting with incredible agility – from Google and Apple’s unprecedented partnership toward contact tracing, to iHeart Media’s SmartAudio COVID recovery program, and even most recently Shopify’s partnership with TikTok. More products and service partnerships are expanding the capabilities of each platform and provider, inching each closer to that one-stop-shop status. But it’s how they are achieving this is the most impressive part. These organizations and so many others are scrapping their old product pipeline in exchange for a more agile process that gets their offering to market more quickly, beating competitors to that share of urgency.
Is There Money Left for Marketing?
Small businesses still need help with their marketing efforts – maybe now more than ever – as the tectonic shift in consumer expectation continues to create tremors underfoot.
So what do they need help with?
- 50% need help marketing to old customers
- 35% need help marketing to new customers
- 27% are asking for guidance in leveraging business intelligence in their marketing efforts
When SMBs need to make quick decisions, your marketing should focus on educating them as quickly and easily as possible.
- How can you quickly educate new prospects when they are feeling the pain of the pandemic?
- How can you continue to communicate and consult with current customers to upsell as they express a need for more?
Why is this important? Because after local businesses have signed on with that new platform or service, 63% of them don’t know what to purchase next. It’s simple – we need to tell them and in terminology, they can understand. Help them connect the dots.
Everything Has Changed Forever
Local businesses are still operating with major concerns in mind. Managing cash flow amid shifts in state lockdown phases and seasonalities is top of mind for 58% of owners and operators, followed by a focus on winning back the attention and business of customers pre-COVID (50%). Rounding out the top 3 concerns, 42% of small businesses are still concerned with adapting to a more remote or digital environment.
While the work of our members and partners will continue to drive the adoption of new and necessary technologies, small business owners across the board (96%) agree that Covid-19 has impacted the future of their business.
- 54% will communicate and collaborate with employees and customers differently
- 51% will sell more products and services online
- 60% are even more willing to adopt new technology to help manage their business
This is an idea we don’t state lightly and we will continue to dig into and unpack the trends and topics to come. We have already explored trends in remote work in a recent report in collaboration with Davinci, and the shifting of cities and technology hubs in conversation with Omers Ventures, at Localogy 2020.
What changes do you see on the horizon? Reply with your thoughts, as I look forward to the conversation.