New Findings on SMBs and User Reviews

As many of you know I’m now working with Dan Miller and Opus Research on a mobile specific program (LocalMobileSearch). This program is about the evolution of the mobile market and the delivery of content and ads on mobile devices. Local is a key piece of that equation — hence the name. However it’s not just exclusively local.

As a general matter were interested in and curious about the reactions of SMBs to a range of emerging issues on the Internet, at the center of which is user-generated content and “online reputation management.” I’ve written a good deal about all the user reviews out there being a kind of “emerging crisis” for SMBs. So we decided to find out if they felt the same way.

We did an survey with AllBusiness.com, because the site’s visitors and members are SMBs. The survey was conducted online in early August. We were surprised to get lots of non-US responses in the just over 1200 we received. Among the 1200, we received 653 responses from North America (the vast majority were US). One must take the findings with the customary caveats about online surveys but there are lots of interesting things here that I’ll write more about later.

For now, here are some very high-level takeaways:

  • Website penetration: 55% of SMBs responding to the survey said they had a website
  • Most commonly used marketing methods: When asked about all media used to market their businesses, respondents identified websites, print newspapers, email marketing, print yellow pages and coupons/direct mail as the methods with the highest adoption and penetration
  • Most successful methods: Identifying their “most successful” marketing methods, respondents named their websites, email marketing, print newspapers, coupons/direct mail, search engine marketing and print yellow pages, respectively
  • Role of referrals: Nearly 60% of respondents said that more than half their business comes from customer referrals and “word-of-mouth,” while 30% said that “more than 75%” of their business is from referrals
  • Awareness and tracking of review sites: Almost two-thirds (64%) of respondents were aware of online review sites and nearly 30% of this group said they actively track reviews, with roughly one-quarter indicating favorable online reviews have led to new business
  • Attitudes toward online reviews: Among those aware of review sites, a striking 59% said consumer reviews “are a good thing and are helping us improve our business.” Yet even negative reviews are being embraced, with more than 50% of this category saying they had contacted unhappy customers to address complaints. Reviews are also being formally embraced in marketing materials, with 40% saying they had quoted customer reviews
  • Interest in video: While only a minority of respondents had developed any video advertising (professionally produced or not), interest in video advertising is rising: 33% of respondents said they were evaluating developing video ads “in the next 12 months.”
  • Why not doing online marketing: Among those who were not doing any online marketing (60%), the main reasons were:
  1. Lack of budget (25%)
  2. Confusion: don’t know how/where to begin (20%)
  3. Lack of time or personnel to do it (15%)

Note: there’s a discrepancy between the 55% who said they had websites and the 60% who said they didn’t do online marketing. We didn’t specifically define “online marketing” and some respondents probably did not consider their site to qualify.

In terms of the core data we set out to obtain, the fact that a majority of respondents were not only aware of online reviews but some significant minority were tracking them was surprising to me. It was also somewhat surprising to see these respondents with a mostly upbeat attitude toward the phenomenon (click to enlarge):

Opus-Allbiz data

n=303

Numbers exceed 100% because of the multiple responses permitted. And there’s some apparent contradiction in the answers: how can reviews be both “good” and “annoying”? But some people obviously hold both views simultaneously.

More later . . .

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17 Responses to “New Findings on SMBs and User Reviews”

  1. Jonathan Trenn Says:

    Greg

    I know you’re on a plane right now, but I’m wondering what types of SMBs resoonded. What type of industries? I’d think that responding to an online survey at allbusiness.com would suggest companies that are tech savvy, but the fact that only 55% had a website suggests otherwise…

  2. Greg Sterling Says:

    88% of respondents were in firms with fewer than 100 employees, with 56% of respondents indicating fewer than four employees. Almost half (49%) of respondents were from newer firms that had been in business for five years or less.

  3. Greg Sterling Says:

    We don’t have good visibility on the verticals; the categories we were using were standardized and fairly broad.

  4. » The increasing importance of local marketing and reputation management Marketing Conversation - New Marketing and Social Media by Abraham Harrison LLC Says:

    [...] Sterling on his blog Screenwerk.  One is Nielsen – WebVisible Data on Local Search.  The other is New Findings on SMBs and User Reviews.  It left me more and more convinced how local businesses must view the internet as a marketing [...]

  5. Chris Brown Says:

    Greg,

    I was suprised with such high percentage coming from referrals. What do you think about providing bonuses for referrals? We just few weeks ago launched referral tracking system http://www.FaceContact.com. It is free to join and it allows to create referral programs like you mentioned in seconds. So we would be interested to cooperate with you on this matter to introduce this service to your respondents. I hope you also will find it helpful.

  6. Richard Singh Says:

    In response to the confusion between reviews being both “good” and “annoying”?, I would say that this may be directly related to malicious reviews from local competitors. The annoying factor may be the interaction between business and review site in having negative reviews removed, contacting customers in regards to resolution and other issues alike.

  7. Greg Sterling Says:

    Quite possibly.

  8. Smalltown Buys Online Community « Screenwerk Says:

    [...] go back to the recent data we pulled from the SMB market regarding word of mouth and their willingness to embrace online communities and [...]

  9. PC4Media Says:

    How to Move “Word of Mouth” About Your Business Online

    That is a working title for an eBook I am thinking about writing. Here’s why: Most successful methods: Identifying their “most successful” marketing methods, respondents named their websites, email marketing, print newspapers, coupons/direct mail,…

  10. ‘No Yelpers’ Says One Local Cafe « Screenwerk Says:

    [...] said, recent research with Opus showed SMBs were largely positive about online ratings and reviews and embraced the [...]

  11. lifeballoons » Blog Archive » New Findings on SMBs and User Reviews Says:

    [...] the full story here Author Comments [...]

  12. Facebook Ads and Local Business « Screenwerk Says:

    [...] the ease with which they could get pages up and running was the appealing feature. In the recent Opus-AllBusiness small business marketing survey, roughly 12% of respondents (n=615) said they had created a profile on MySpace. While that number [...]

  13. More Evidence of Reviews’ Importance « Screenwerk Says:

    [...] the recent Opus-AllBusiness SMB online survey, roughly 58% of respondents said that at least half their business was being generated from [...]

  14. Survey: Print YP ‘Most Effective’ « Screenwerk Says:

    [...] the more likely to have a site and do online marketing today. In the online SMB survey that Opus Research and AllBusiness did, the self-reported number with a website was 55%, with about 12% of the SMB-respondents having [...]

  15. Chris Says:

    Whilst there’s a huge number of small businesses without an online presence, it’s heartening to see just how many have woken up in the UK. There’s still along way to go, mainly because of ignorance of the possible benefits.

    Chris

  16. Yahoo! Simplifies, Expands Webhosting Services « Screenwerk Says:

    [...] sites, although they may have a profile or landing page somewhere online. Opus Research-AllBusiness data reflect that 55% of SMBs have a “website” as they’ve defined that term (at the [...]

  17. Yelp Adds CRM Tools for Merchants « Screenwerk Says:

    [...] it appears that merchants have a largely positive attitude about reviews. The following is from an SMB survey conducted by Opus Research and AllBusiness.com in August, [...]

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