Empowering Small Business

Unfilled Job Openings "Very High" for Small Businesses

Although the U.S. Labor Department reported today an overall job-market downturn in the corporate world, small businesses are in a completely different boat. According to a survey done last month by the National Federation of Independent Businesses, and out today, 25% of small business owners said they have unfilled job openings - a very high percentage response to this research question from a historical perspective.

In fact, 14% of small business owners said that locating and hiring qualified labor is their No. 1 business problem and 85% of the total respondent group said that they are finding few or no qualified applicants for open positions. For small businesses then, there is a "tight labor market," according to NFIB chief economist William Dunkelberg.

Why are smaller businesses, with employees 50-20 employees or less, having such difficulties recruiting employees for open jobs when the overall labor market is experiencing the opposite problem in terms of overall job loss. According to Jim Hopkins, USA Today, "people don't want to work for small companies because they doubt they'll get the same pay, benefits, job security and career advancement" more readily available to them at larger, more corporate-like enterprises.

Shivonne Byrne, Innuity CMO

Small Businesses Cautiously Optimistic Despite Economic Challenges

Visa just released their "Small Business Spend Insights" study that reports that nearly half of the small business owners surveyed expect an increase in profit, revenue, and cash flow over the next six months while expressing concerns about rising energy, rent, and mortgage costs.

In terms of specific breakdowns, almost half (44%) of these small business owners expect an increase in revenues over the next six months, with only 13% expecting a decrease. 40% of these owners expect an increase in profits over the next six months, while only 22% anticipate lower profits for this period. In terms of borrowing, only 19% expect to borrow money to enhance cash flow over the next six months.

This optimism is muted by recognition of rising costs. Energy in particular is a big issue, with 72% of the survey participants expecting energy increases over the next six moths. Additionally, 23% of small business owners are projecting rent and mortgage cost increases in the next six months.

Attracting new customers is still on the hot list for some, with 23% of small business owners concerned about adding to their customer base.

These attitudes are impacting cash outlays for small business owners, with 58% expecting to slow large capital investments and 41% slowing small capital investments. Visa assumes that these adjustments in slowing down capital outlays will allow small businesses to fund investments in their most pressing business challenges such as finding new customers.

Shivonne Byrne, Innuity CMO

How to Measure Social Media for Small Business

"Tracking the Influence of Conversations: A Roundtable Discussion on Social Media Metrics and Measurement" authored by Jeremiah Owyang, formerly with Podtech.net and soon to be with Forrester, and Matt Toll, with Dow Jones, begins the dialog about how an organization can effectively measure the value and marketing effectiveness of social media.

As collaborative Web 2.0 technologies continue to be introduced and proliferate the consumer and business environment, we are seeing increased interest and discussion about the value of social media tools - blogs, podcasts, videoblogs and social networking sites. But how important are these conversational vehicles, really, to overall buying decisions? How can organizations join in these conversations, and influence product-service evaluations and purchasing behavior?

The key to remember is that social media is about having two-way conversations, and that previously powerful obstacles between a seller and target customers are being removed with tools are simple as blogs. All of a sudden, information can be disseminated (locally to globally) in a heartbeat via some combination of social media.

For the findings below, about 30 marketers, bloggers and social media experts gathered together and came up with these measurement attributes:

• Analytics and Activity: Focused on traditional measurement elements like page views, unique site visitors, etc.
• Community Activation/Call to Action: Are recipients reacting to some call to action message?
• Conversation Index: The ratio between blog posts and comments-plus-trackbacks.
• Demographic/Who: Understanding who is responding to the message - who is reading, watching, talking, and for how long?
• Influential Ideas (Memes): The intensity or velocity of the spread of an idea or message over time - answering the question, who is creating a real dialog? (Bloggers and marketing consultants placed the most value on this metric)
• Participation and Engagement: Responding, and acting, on the message. (Corporate marketers placed the most value on this metric)
• Reach: Has less to do with sheer numbers and more with who you are influencing.
• Relationships and Connections: The concept of influence in a specific target community is growing in importance as small communities form and niche conversations start in every industry.
• Relevance: How relevant is a specific blog post to a given company.
• Sentiment/Tone: Tone-flavor of any given response.
• Content: Intrinsically linked to the focus of a given social media platform.

One interesting finding was that traditional Web analytics placed very low as a metric - suggesting that social media is relevant in ways different  from traditional online marketing. "Reach" also was ranked very low, suggesting that forming closer relationships was more highly valued.

Although the group did not determine or endorse any particular standard method of measurement, they all acknowledge the pressure they experience to validate their investments in social media marketing. Clearly, this particular dialog has just begun.

Shivonne Byrne, Innuity CMO

30% of Small Businesses Expect Increase in Internet Sales

The Small Research Board, in conjunction with Business Today, released today their most recent study looking at eCommerce behavior, expectations and technology needs of small business owners and managers of more than 550 small businesses representing a breadth of U.S. industries.

Their reports highlights that many small businesses are experiencing a real technology divide, with more than 42% reporting that they do not have websites and another 25% choosing not to sell products or services on websites they currently have running.

While 97% of respondents expect that revenue generated from eCommerce sales will stay flat or increase over a period of one to two years,  29.2% of this percentage group do expect online sales to increase.

A serious gap exists between small businesses who have embraced the Internet and those that have not. As noted earlier 42.7% said they do not have website, while 47.3% have a minimum of one website with 7% of those having between two and five websites, 2.1% have six to ten websites, and .9% having more than 10 sites.

In terms of total respondents, 7.8% don't sell any products or services on the Internet, with 43.9% of those that have websites electing not to sell products or services.

The study indicates that the larger small businesses (with annual sales of $25 million or more) are the most positive about selling on the Internet, with 48.15% of this group predicting an increase in Internet sales during the next 12-24 months. In contrast, small business owners with revenues of $500K or less, are the second most optimistic group with 36.2% expecting growth in the eCommerce sales.

The Small Business Research Board surveys and analyzes the opinions of small business owners and managers on a wide variety of topics related to their own businesses as well as national international issues that may impact their operations.

Shivonne Byrne, Innuity CMO

Why Blog Headlines Matter

The online Wall Street Journal just featured a telling article on Steve Spangler, a former Denver science teacher, Emmy-winning TV science host, and director of the national Hands-on Science Institute for science teacher training, who now has an educational toy company (Steve Spangler Science) which employs over 30 people and last year recorded more than $5 million in revenues.

In analyzing his success as a small business owner, Steve gives the nod to his blog as being the primary driver that has catapulted his business forward financially. The reason the blog works, from his perspective, is that the blog regularly publishes new information (new web pages) that are indexed so well on search engines, such as Google.

But the real secret, according to Steve, is the power of great headlines to attract visitors to his blog. He shares the story of one of his early blog headlines, "It's Great to be Stupid," that commented on a Good Morning America featured "top stupid product." Viewers didn't know his blog, weren't searching for him, but the headline was picked up and drove countless people to his blog - and ecommerce site.

Steve's blog receives 15,000 - 20,000 unique visitors each day, and he credits 13% of his overall sales to the blog. He is committed to keeping the conversation going, writing attention-grabbing headlines, and propagating his blog for a long time.

Shivonne Byrne, Innuity CMO

Online Marketing Traffic Tactics

Attracting consumers via online marketing strategies is a cost-effective approach to driving revenue for small businesses. To illustrate the importance of these online marketing methodologies, the Wall Street Journal just published a research report summary* on how small businesses increase online traffic.

In the area of online marketing, small businesses said they use the following marketing tools along the lines of these percentage responses:

• 55% submit company websites to search engines
• 47% utilize search engine optimization
• 37% buy online yellow pages
• 35% buy Google ad words
• 34% buy Yahoo ad words
• 30% utilize website analytics

In terms of current and emerging problems, small businesses identified the following issues as either being a serious problem currently (C) or becoming a problem (B):

• Increasing competition for natural or organic search engine rankings: C - 32%; B - 49%
• Increasing competition for top paid for search positions: C - 29%; B - 51%
• Tracking total return on investment of search marketing: C - 23%; B- 31%
• Keyword price inflation: C -19%; B - 44%
• Click fraud: C - 18%; B - 28%

In the area of pay-per-click advertising where companies only pay when a person clicks on an online ad, the average reported increase in the median cost per click is 16%.

As we can see, online marketing is now a key business driver for small businesses and at Innuity we are focused on helping businesses connect with customers most likely to buy their particular products and services. To learn more about Innuity's small business promotional services including local search engine marketing, search engine optimization, pay-per-click marketing, website services YP Guides and more call 866.814.4080.

*Sources: 2007 U.S. Small and Medium Business Mobility and Business Applications Survey, Yankee Group Research

Shivonne Byrne, Innuity CMO

The Importance of How

About a month ago, a CEO I had just met recommended Dov Seidman's new book HOW: Why HOW We Do Anything Means Everything...In Business (and in Life). In a world where progress and success is often rewarded regardless of how it was achieved, How makes a compelling argument for rethinking this strategy and reviewing the set of values by which we live.

In my home and in my formative educational environment, how I behaved was evaluated much more than the sum of my total achievements - although I certainly was recognized for achievement. HOW makes the case that in today's world where information is immediately accessible on just about everything and much of what is produced in terms of products and services (the whats) have been commoditized, how you behave-act-live-work is where the real game of differentiation and value needs to be played.

Although there was a long period of my career where this type of thinking was categorized as the "soft stuff", Seidman makes a cogent case for how the age of transparency is right here/right now and that success in life is more based on behavior (or in the case of business, of outbehaving the competition). Today, characteristics such as integrity, passion, humility, and trust are the true cornerstones of business growth and living according to their tenants is what your customers, partners, colleagues, employees and investors (and friends) can count on.

The concept of HOW represents a new currency for business, and not necessarily an easy one to calculate if you've lived according to a different set of rules. But in a wired world, a sterling reputation is your greatest asset and it is a well of capital from which you can draw. Mismanaging that reputation can have grave and lasting impact, and it will not go unnoticed.

Shivonne Byrne, Innuity CMO

Small Businesses are Critical to Today's Economy

The Small Business Administration just published a report on the extraordinary importance of small business to the overall national economy. The Office of Advocacy defines a small business for research purposes as an independent business having fewer than 500 employees.

In terms of results, small firms:

• Represent 99.7 percent of all employer firms.

• Employ about half of all private sector employees.

• Pay more than 45 percent of total U.S. private payroll.

• Have generated 60 to 80 percent of net new jobs annually over the last decade.

• Create more than half of non-farm private gross domestic product (GDP).

• Supplied 22.8 percent of the total value of federal prime contracts in FY 2005.

• Hire 40 percent of high tech workers (such as scientists, engineers, and computer workers).

• Are 52 percent home-based and 2 percent franchises.

• Made up 97 percent of all identified exporters and produced 28.6 percent of the known export value in FY 2004.

• Small innovative firms produce 13 times more patents per employee than large patenting firms, and their patents are twice as likely as large firm patents to be among the one percent most cited.

In 2006, there were 26.8 million businesses in the United States, according to Office of Advocacy estimates. Census data show that there were 5.9 million firms with employees and 19.5 million without employees in 2004. Small firms with fewer than 500 employees represent 99.9 percent of the 26.8 million businesses (including both employers and nonemployers), as the most recent data show there were more than 17,000 large businesses in 2004.

Over the past decade, small businesses created 60 to 80 percent of the net new jobs. In the most recent year with data (2004), small firms accounted for all of the net new jobs. Firms with fewer than 500 employees had a net gain of 1.86 million new jobs. Large firms with 500 or more employees lost more jobs than they created, for a net loss of 181,122 jobs.

Tech-Savvy Small Businesses Tend to Grow Faster

A recent study conducted by CDW called "Business Rearview Mirror" studied the lessons successful entrepreneurial mid-sized businesses garnered from their early small business growth. In looking back on their positive growth track, a strong theme for these companies was that it helps to be a technology geek when faced with the myriad of IT challenges, which was the 2nd most critical challenge that all these businesses faced.

The study reports that small businesses succeed when they have a focus on technology, and in fact, tech-savvy owners succeed faster. 61% of the study's participants who view IT as a strategic or competitive investment reported double-digit average annual growth over the past five years, compared to 43% of those respondents who spent "just enough" to ensure employees were able to do their jobs.

In terms of those business owners that classify themselves as "total geeks" or "technology nerds", there certainly was the smell of sweet revenge. 73% of respondents who rate themselves as "complete geeks" report double-digit average annual growth in their businesses over the last five years. Close to 50% of these respondents say their companies reached 100 employees within five years, compared to one third of all survey respondents.

What these small business owners were experiencing was the plethora of technology challenges inherent to traditional "point" technology applications - the very problem that Innuity is focused on solving with our SaaS (Software as a Service), on-demand applications supported by our internal technology infrastructure. Our goal is to significantly reduce the costs associated with purchasing and integrating technology solutions and transform the customer experience into one that you don't need to be a geek to succeed at.

Shivonne Byrne, Innuity CMO

Small Businesses Creating Almost All New Jobs

According to a just published report by the Small Business Administration, businesses with 20 employees or less account for 90 percent of all U.S. businesses and have created 97 percent of all new jobs. This data is just one statistic based on Census data from 1988-2004, the most recent year available.

Other information in the report includes job creation, business births and deaths, industry growth, and regional differences. The states representing the highest number of new small businesses in urban areas for the last fiscal year of this time period are California, Florida, New York, and Texas.In terms of more rural regions, Texas and Missouri have experienced the greatest growth of new small businesses.

In summary, small businesses grew more in this last year than the previous year because of the small numbers of firm closures and the overall increase in new small businesses.

Hot "growth" cities such as Las Vegas and Orlando have experienced notable population growth in the last few years of this study, and small business new firm growth in these cities reflect the overall population growth.

The study cites that as the national economy prospers, the average small business company size is inclined to increase.

A new feature of the study is the addition of state specific data, not just for this time period but also going back into the mid-1990s. This way the SBA will be able to track market segments' impact by geographic region.

Shivonne Byrne, Innuity CMO