3 Revenue Growth Opportunities for SMB Marketing and Ad Agencies
Photo above courtesy of Clark Street Mercantile.
Digital marketing spend among small and medium-sized businesses (SMBs) has exploded in the last few years. According to eMarketer, 40% of SMBs are investing more into the channel, compared to just 30% on traditional marketing. At the same time, SMBs are being more conservative about the agencies and vendors with which they partner. In the transparency era, consolidating spend with a select group of trusted agency partners that offer multiple core services is now the norm.
For agencies that cater to SMB brands, these trends have created opportunities and challenges. There is money to be had, but only organizations that differentiate themselves from the competition and can deliver clear ROI will benefit. So how can SMB agencies show their value to brands and ensure revenue growth?
There are three opportunity areas, in particular, that can help.
Location-based advertising spend online—thanks to mobile—is a massive revenue driver for the SMB channel. For example, a BIA/Kelsey study found that location-based mobile ad spend ballooned to more than $22 billion globally in 2018 and will climb to nearly $40 billion by 2022. This is in response to the growth in “near me” searches. Mobile phones have become the screen of choice that consumers consult first. And as battery life has improved, more are keeping location services on, seeking out brands and services nearby. This has created a host of new target marketing and engagement opportunities for SMBs.
Smart agencies are taking advantage. They are offering access to location-enabled inventory, facilitating location-based ad buys on mobile and on desktop, local SEO, and more. As more SMBs look to location marketing as a necessity, savvy agencies need to position themselves as the gatekeepers.
Customer reviews management
Traditional advertising is only one part of the marketing mix for smart SMBs. User-generated reviews are increasingly important and need to be part of any program.
Eighty-five percent of consumers trust online reviews from sources like Google Reviews, Yelp, TripAdvisor, Facebook, and more. Compared to traditional ads, user-generated customer reviews simply come off as more authentic. For SMB brands to benefit, however, they need to proactively optimize and manage the reviews they are getting for every store, product, customer interaction, and brand. But that can be a challenge.
This is where SMB agencies can benefit. They can provide review management and reputation services to brands, helping them respond in high-quality, personalized, and effective ways that keep customers coming back. Many SMBs are offering this service in-house today. This is expected to change in the next two years as their needs become more sophisticated. In fact, data suggest that SMBs will spend over $2 billion on reputation management by 2020.
Voice search optimization
In just a few years, voice assistant technology has hit the mainstream. From Alexa to Siri to Cortana, more devices now have voice capabilities and are providing a more frictionless search experience to customers. Between 2016 and 2017, for example, monthly active users of Amazon’s Alexa grew by 325%. Relatedly, brand voice searches have skyrocketed. The 2018 Voice Search Survey found that, in the US, voice assistants are being used to “find the phone number for (68%), directions to (67%) and hours of operation (63%) of a business.” More consumers are turning to voice to help them seek out products, brands and services.
Despite the growth, SMBs have been slow to embrace voice as a marketing channel. In our own Voice Search Readiness (VSR) analysis of 73,000 business locations, we found that just 4% of brands were voice search ready. Looking at SMBs, specifically, more than three-quarters believe voice has value but 40% have yet to do anything with it. Still, one-third plan on increasing voice budgets, presenting agencies a significant partnership opportunity. Agencies that can provide voice services, while offering clear numbers on ROI and impact, will win those dollars.
SMBs are spending more on digital marketing but are being more careful than ever on the entities with whom they spend it. To compete and thrive, SMB marketing agencies need to look towards areas like location marketing, customer reviews, and voice. Each one is a growing revenue opportunity and can help future-proof their success.
Tehsin Daya is VP of Business Development, North America, at Uberall. Tehsin has more than 10 years of experience in location marketing. Before joining Uberall, he spent six years in a variety of roles including Sr. Director for ReachLocal’s partner channel business, and prior to that, on the corporate strategy team, where he lead key ecosystem and strategic partnerships, including Facebook. Tehsin holds a BA from Indiana University, and an MBA from Pepperdine University.