MerchantCircle (recently acquired by lead-gen site Reply) put out its latest quarterly Merchant Confidence Index. In general this measures SMB attitudes about the state of the economy. There are also marketing questions, which are more interesting to me.
The latest Q2 survey (from about 4,000 SMB respondents) offers some interesting findings about social media and daily deals in particular. All the data and findings below must be qualified by the statement that MC’s SMB member base is generally more “socially savvy” than SMBs in general. Below is a selection of the data released.
The first chart below reflects that more MC SMB members are using Facebook to market themselves than any other single site or method. This number is higher than the SMB general population, but directionally consistent.
Asked about which marketing tools, methods and tactics were most effective, respondents answered social networks followed by email, followed by “local review sites” (e.g., Yelp). Online yellow pages was right behind that, but PPC ads on search engines was in ninth place.
MerchantCircle asked about use of Facebook Ads (as opposed to Pages/Profiles). The great majority had not used them. Of those that had roughly 2/3 said they would again, but a substantial minority of SMB Facebook advertisers said they would not. This probably reflects inexperience and a lack of knowledge of best practices.
Now on to daily deals. This respondent pool has mostly not used daily deals (82% had not). Of those that had, a large majority (77%) said “yes,” they would do so again.
The results above stand in contrast to a survey I did with MerchantCircle in February (n=8,514), where we saw 54% of those who had done a deal say “no,” they would not again.
Right now there’s no easy way to account for this discrepancy expect to say that perhaps the deal sites are doing a better job of education and/or the merchants have become more savvy in the intervening period.
Those who had a good experience found that daily deals were an effective customer acquisition tool. A significant number also found they could “negotiate” with the deal vendor — something that’s becoming more common. But what about the negative experiences?
Those who had a bad experience complained that deals were an ineffective customer acquisition tool and were too expensive for them. This may be a function of inexperience or poor planning on the SMB’s part — or a lack of proper expectation setting by the sales reps.
The chart below reflects that sales outreach is the primary way that SMBs are becoming aware of daily deal sites, followed by advertising and PR. The question was “How did you find out about the group buying site you used?”
The big takeaways here for me are:
- SMBs are rapidly embracing social as a marketing medium
- They’re experimenting with a broader range of tools and media (and paid search is not high on the list)
- SMBs are often ignorant of how to effectively market themselves and the medium gets blamed
- Sales reps are a critical link in the process: bad reps/over-promising = bad SMB experience
What do you think is most interesting about the data above?