After the roller coaster ride that was the 2011 economy, small business owners are understandably hesitant to explore new strategies in 2012. Yet, experts advise that decision-makers pay heed to small business trends such as: the impact of social networking, the benefits of cloud technology, and management of their online reputation.
Small Business Focus
According to research by Novarica, the technology and strategy research division of financial services consultancy Novantas LLC, 2012 will see an increase in technology spending by banks for the small business segment. The move is part of an overall strategy by banks to improve their retail customer mix.
At the 16th Annual Small Business Banking conference in Scottsdale, AZ held on November 10, 2011, Matthew Josefowicz, partner and managing director of the Novarica division, said that mid-size banks were investing heavily in such technologies as analytics, straight-through-processing and social media for small business.
Business Wire announced the highlights of the conference in a November 10, 2011 article titled, “Banks Will Increase Focus on Supporting Small Business in 2012, Says Novarica Study.” The investments in technology are expected to be a boon to the support of small business lending. The article said, “The study also found that banks are also investing to develop their sales and service effectiveness for small business customers. This includes investment in the branch channel as well as following the trend to non-branch channels, particularly online and mobile.”
Technology was also the focus for writers at the Noobpreneur.com blog who reported on “3 Small Business Trends to Watch for 2012” in their post of October 24, 2011. Number one on the list was social media, especially Facebook. Citing the Nielsen Social Media Report, the writers pointed out that Americans, who spend 25 percent of their online activities on social media sites and blogs, spend more time on Facebook than any other site.
Very likely due to the abundance of social media activity, it will become more important than ever for businesses to monitor and manage their online reputation. The writers said, “Manage your online reputation well; monitor what people say online about your small business; respond accordingly; contact the opinion makers so that you can persuade them to update their followers and readers with new positive development or simply a clarification… anything, really.”
Why is online reputation so important? According to research conducted by Cone Communications, a public relations and marketing agency, 80 percent of customers changed their minds about a purchasing decision based solely on information they found online. This figure is up from 67 percent in 2010.
Trends in the Cloud
The third trend of concern to Noobpreneur writers was the issue of data security and the fact that most small businesses are woefully unprepared for a data disaster. They recommend the adoption of cloud computing solutions for backup and data protection.
Cloud computing is a service where users can share resources such as applications and information over the Internet. Users can access the resources with their web browsers and mobile apps. All software and data are saved on server computers rather than the computers of the users. Google Apps is a prime example of cloud computing.
A Year of Challenges
For small to medium businesses, 2011 will be remembered as a year when the primary challenge was to grow their customer base and retain current customers, according to Rieva Lesonsky in her November 30, 2011 post to Small Business Trends titled, “Small Business Outlook for 2012: Business as Usual?” Citing the results of a survey of 1,000 decision-makers at small and medium sized businesses conducted by her company, GrowBiz Media, Lesonsky, found that business decision-makers have been more concerned about competition from both customers and clients.
Based on survey results. Lesonsky found that the unstable economy of 2011 has made small business owners wary of plans to change their business focus. She predicts that 2012 will see little in the way of technology innovations or expansion either geographically or in their product and service offerings.
Regarding the focus in 2012, Lesonsky said, “Heading into 2012, SMBs will continue to focus on the challenges that occupied them in 2011. Specifically, their key areas of improvement will be customer/client growth (60 percent) and customer/client retention (38 percent). As a result, the top areas where SMBs plan to spend are marketing (35 percent) and sales (28 percent).”