Are Small Businesses Apathetic About Social Media?

Social media marketing is popular but not critical

August 8, 2011 Uptake of social media marketing among small and medium-sized businesses has become widespread. Research has suggested it’s a cost-effective, easy-to-use marketing channel that can boost customer acquisition as well as fulfill other marketing goals. But most small businesses still don’t see social media as a necessity.

More than half of the small-business decision-makers surveyed in June by small-business insurance provider Hiscox said they used social media for business purposes, but a plurality also declared that it wasn’t necessary to their business. Just 12% considered it a “must.”

At the same time, though, 50% of respondents said the marketing tool they could not do without was word-of-mouth. Just 4% said the same about social media, even though the goal of most social media marketing efforts is to create word-of-mouth.

Nearly two in five respondents said word-of-mouth was the main way they got business, and another 42% cited word-of-mouth in combination with other marketing promotions.

While offline forms of word-of-mouth remain critical for all brands, and certainly for small, local businesses, social media also plays a valuable role by giving customers a wider voice for their recommendations and helping to amplify that voice beyond their immediate circle of friends, family and colleagues.

Among those small businesses that were using social media for marketing purposes, Facebook was most commonly used and was also considered the most effective at growing and expanding the business, followed by LinkedIn.

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