Experts have long been saying that digital marketing levels the playing field, creating new access for small and medium-sized business (SMB) growth. Indeed, without digital marketing expertise, businesses can waste their marketing budgets with little to no ROI. But independent U.S. digital marketing firm Fullmoon Digital affirms that while digital marketing can provide targeted access to buyers at budgets within reach of SMBs, it can also result in quickly escalating costs with minimal results if not used properly. Agency CEO Derek Chow offers insights to help SMB owners target their most effective channels for rapid growth.
In the United States, 33.2 million small businesses account for 99.9 percent of all U.S. businesses, yet volatility is astronomical
In the year following March 2019, 1 million small businesses started, and 993,809 closed, leaving a net gain of only 42,650. Despite access to relatively affordable digital marketing strategies, many owners lack the knowledge and skills to employ them effectively.
“My clients have outstanding products and services, but many were jumping from one digital platform to another, hoping for a big win but failing to gain traction,” said Chow, in a news release. “It’s easy to do—owners receive regular promotions from various platforms with offers and promises. The truth is every platform is a winner, but not for every business.”
The biggest challenge most new SMB clients face is wanting more marketing than they can afford
Often, the first part of the client-focused campaign development process at Fullmoon is to align expectations and establish a realistic framework of spending and growth. This forms a foundation for win-win success, paving the way to meet the unique digital marketing needs of each SMB.
In a 2021 poll, small businesses reported spending an average of $534 a month on digital advertising, with the total marketing and advertising budget ranging from $10,000 to $50,000 a year. For some businesses, this spending falls short of what it takes to gain visibility and market share. The U.S. Small Business Administration suggests allocating at least 7-8 percent of gross revenues to marketing, with 50 percent of that budget directed toward digital marketing.
However, successful B2C companies spend between 14-17 percent of their gross revenue on marketing, while B2B companies spend between 8-12 percent. A business with $1 million annual gross revenue would expect to spend $80,000 to $170,000 on marketing, with half of that allocated to digital marketing.
More than dollars spent, businesses that track marketing ROI outperform those that don’t
A study from the Content Marketing Institute shows that 72 percent of the most prosperous companies compute their marketing ROI compared to only 22 percent of the least successful companies.
“Good agencies can help SMBs prioritize the best bang for their buck by carefully tracking a number of metrics, including ROI,” said Chew. “Building and sustaining successful digital marketing campaigns is a journey that requires hard work and consistent collaboration.”