Digital Marketing Services to Compete for Local SMB Ad Dollars

For small and medium-​sized businesses, SMBs, online advertising has been called the great equalizer. With enough savvy, a typical SMB can reach more consumers in affordable ways and compete with larger businesses. But, being savvy may have a whole lot more to do with marketing services management than with actual advertising purchases.

As I noted earlier this week, marketers are looking for help with their digital media purchasing and this is often in the form of understanding how to target specific audiences and how to understand the results of their ad campaigns. It turns out, SMBs are in this position as well. New research from Borrell Associates shows SMBs are spending more than twice as much on marketing services than they are on online advertising:

  • Marketing services: $17,000
  • Online advertising:  $6,800

According to Borrell, the largest part of online services spending goes to Web hosting , part of web presence, and email services, marketing support. SMBS are also paying for SEO, social media, ad production, and consulting and research. These are often areas in which the SMB owner lacks both the time and expertise to do well.  Previously, traditional media sales reps helped local businesses with their ad design and placement. But in the new world of big data, service providers will capture more business and revenue because of the disruption in the marketplace. Borrell analysts classify these businesses as:

  • Media companies which sell ‘advertising’ products. This includes directories and online publishers.
  • Local ad agencies which are helping small businesses make media buys.
  • Business services companies which have expanded their offerings into digital marketing services.
  • Large pure-​play competitors who are moving into local markets by using local reps.

With so much money shifting to services, it’s easy to see how the ad dollars traditional media companies have been relying on are quickly eroding. The sooner the media sales reps can develop niche expertise in digital marketing services, the better.

[Source: What SMBs Spend on Digital Marketing. BorrellAssociates​.com. 20 Oct. 2012. Web. 25 Oct. 2012] 
Kathy Crosett
Kathy is the Vice President of Research for SalesFuel. She holds a Masters in Business Administration from the University of Vermont and oversees a staff of researchers, writers and content providers for SalesFuel. Previously, she was co-​owner of several small businesses in the health care services sector.