New Street Fight Report: Selling to Local Merchants
Street Fight’s latest report on local merchants, Strategies for Selling Marketing & Technology Services, posted today. It’s a companion piece to our annual survey of local small and medium-sized businesses, that focuses on vendor strategies for selling local marketing services and up-selling add-ons or suites of offerings.
Street Fight surveyed over 250 local merchants on their marketing and e-commerce usage, effectiveness, and challenges. Over 40% of local merchants we surveyed said they would increase their social media spending. Similarly, email marketing and local sites will see bigger budgets, according to 36% of those polled. Very few said they’d cut back on any of the digital categories we offered.
Regular Street Fight contributors David Mihm and Mike Blumenthal have written a series of posts on the ideal digital marketing starter kits for SMBs. Their package would collect a website, listings management with directory support, email, review solicitation and management, and Facebook and Instagram ads for $150 per month. Paid search and managed social presence would be add-ons. This approach matches the digital marketing tactic adoption patterns our survey showed, although it ignores traditional media and direct mail.
Street Fight’s survey showed a pattern of momentum spending, i.e., the more a local merchant spent on marketing, the more likely he was to increase. And that pattern held true regardless of budget. So it’s worthwhile for a supplier to get in early and grow along with the customer. Still, the best targets spend more than $25,000 annually, and comprise a little under a third of the survey respondents. They use a broader variety of channels, media, and management services.
And while it’s desirable to be a one-stop provider of a suite of marketing services – both for revenue volume and customer lock-in, as well as for the customer’s ease of integration and campaign coordination and optimization – it appears that most local merchants already work with multiple suppliers and are fairly comfortable doing so.
The figure above shows that the plurality of local merchants work with three or more suppliers or agencies, and that figure is three-quarters for those with bigger marketing budgets. The average local merchant we surveyed works with 2.7 suppliers, and if you strip out those that say they do it themselves, that rises to 3.7. From an attitude perspective, the plurality (40%) said they preferred to work with multiple companies to get the best solution or price.
On average, survey respondents said they need the most help with search: with SEO (50% of all respondents) more than with paid search (33%), as far more have websites than use AdWords. Another 29% cited social media needs – reputations monitoring and review generation – as among their Top 3 needs.
Suppliers of marketing tech and services can tune their sales strategies by taking advantage of the following:
- The figure above shows that those local merchants with larger budgets need help even more than the little guys, and on a broader area of marketing tactics.
- Our analysis suggests it’s wise for suppliers to aim to add services to or integrate programs and campaigns with the two most prominent tactics: social media and email. There also may be rich opportunities in selling them social video services, direct mail programs, and local broadcast media.
- The top digital marketing objective for the average local merchant is new customer acquisition, but many are also highly interested in customer service. Social video and direct mail could complement email for this.
The new report presents “cheat sheets” based on attitudes and marketing adoption patterns to help with positioning and selling local technologies and services to local merchants.
David Card is Street Fight’s director of research.
Click here for more on the Street Fight Insights report, Strategies for Selling Marketing & Technology Services: Local Merchant 2017.
