Small and medium sized businesses rely heavily on word of mouth and referral advertising. We all know that and the point has been made ad nauseum.
Even with that in mind it seems quite interesting to see the findings of a study conducted by SMB insurance provider Hiscox. Essentially it says that many small businesses don’t find social media important yet half of them say that they couldn’t live without referrals from word of mouth (WOM) sources.
eMarketer shared the Hiscox findings
Note that only 12% say they have to do it while only 24% said they get involved in social media when they have the time. The rest?Well, 64% of the respondents said they either don’t use it for their business, don’t know enough about or don’t give a rip at all!
The next chart shows that in the US 50% of the businesses feel that personal recommendations are something they couldn’t live without while social media rated just 4% saying the same thing.
I have worked with enough SMB’s to actually understand this kind of finding. It seems almost counterintuitive to those who are immersed in the world of social media. Isn’t social media the new word of mouth after all?
The answer is not necessarily. This answer is most dependent on a few factors.
Where the SMB is in its life cycle – The older the company the more success they have had with traditional marketing options. Some hold on to everything despite evidence that it all doesn’t work like it used to (i.e. Yellow Pages) while others have jettisoned the less useful tactics while keeping the ones that still work. Because they are pressed for time and resources they just haven’t felt the urgency to “get social”.
The age of the SMB’s top management – Let’s face it, the younger you are the more social media savvy you are likely to be as a general rule. Long time business owners and managers in the 45 plus range just don’t have the time or desire to learn the social media game in many cases. Not to say that this course of non-action is a good one. It just is what it is.
The social media industry looks slimy – At some point having everyone and their brother hanging out a shingle proclaiming their mastery of the social media dark arts is going to hurt the advancement of the cause. Thanks to the path blazed by shady search marketers, social media has gotten to that point even quicker. And no one in their right mind is going to be throwing their trust into an industry that thinks the descriptors of guru, ninja, maven etc are a good thing.
Limited SMB resources – Look, just because a company has even 100 employees it doesn’t mean that even one of them has a true social media aptitude. At this point, most business owners have the realization that may need to hire someone to do something they themselves are not comfortable with. Now you are in the head of the SMB decision maker where FUD (fear, uncertainty and doubt) exist but are not on display in most cases for fear of looking weak. Pulling that trigger to hire even a consultant gets bigger than it should in their mind and the likelihood of it happening fades pretty quickly.
The social media industry (again!) is doing a poor job of defining social media and its business value – That one is pretty self-explanatory don’t you think? We package social media as some magic potion, elixir or spell that everyone is using to the utmost and you, Mr. SMB, must be kinda stupid if you aren’t getting it. Shame on us.
So there seems to be a disconnect here that, if not addressed, can turn into a larger issue than it needs to.
Now, in fine blogger fashion I have outlined some issues without giving you any solutions. Why do I do that? So I can have our readers show that they are experts rather than just claiming it. Any thoughts to help SMB’s cross the chasm and understand that word of mouth and social are not from other planets but rather they are very close relatives?
And if you would like to see another take on this same data from our Inbound Marketing Channel sponsor, HubSPot, check it out here.