The Trump administration may be seen by much of the electorate as highly polarizing, but the NFIB reports that small business optimism stands at a record high. The economic expansion in most areas is likely to drive demand for advertising and digital marketing services.
At the end of 2017, the small business optimism index stood at 104.8. The only other time the index has been nearly this high was in 2004, when it reached 104.6. Most recently, businesses told researchers they are feeling particularly confident about: (Numbers are in comparison to the previous month.)
- Plans to make capital outlays 27% (+1%)
- Have current job openings 30% (+1%)
- Believe now is a good time to expand 27%
Researchers also pinpointed the specific industries with optimism that indexes over 105. These include:
In addition, small businesses with more than nine employees also scored higher than 105 on the optimism index.
Twenty-one percent of small business owners cited high taxes as their biggest problem. However, the poll was taken before the most recent tax legislation was enacted, so that attitude may change in the coming months. Next on the problem list is quality of labor available with 19% calling this issue a headache. Reps who sell recruitment ad space and services may be able to increase sales by talking to businesses who are having trouble hiring.
With over 27% of SMBs believing 2018 is a good time to expand, don’t expect them to automatically spend more on advertising. As BIA/Kelsey reported last fall, about half of higher-spending SMBs will maintain ad budgets this year. While these businesses may not be buying more TV and radio placements, they are looking to make changes – specifically, they plan to shift resources to digital, with about 62.2% of the budget going to those formats.
Start targeting SMBs in your market and ask them specifically how they plan to expand this year. Show them how your media formats will help them sell more products and services. Once they see the results of their initial efforts, they’ll be willing to spend more money with you.