Insights into Small Business Owners, Google/Slack ...Google Confidential and Proprietary 22 SMB...

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Insights into Small Business OwnersHow SMBs Make Procurement & Business Information Decisions Google/Slack BarshingerU.S., June 2009

Google Confidential and Proprietary 2 2

SMB Research: Google Objectives

We set out to answer 4 key questions:• For purchase decision makers at Small to Medium Size Businesses

Source: Slack Barshinger study commissioned by Google, “Procurement & Business Information Research,” March 2009

1 What is the role of the Web overall?

2 What is the role of Search in finding suppliers?

3 How is Local Search used?

4 What is the value of Social Media?

Google Confidential and Proprietary 3

Research Methodology

Source: Slack Barshinger study commissioned by Google, “Procurement & Business Information Research,” March 2009

Methodology Online survey (Avg. time = 21 minutes)

Timing March 11 -13, 2009

Quantitative Sample

444 purchase decision makers (US)•<5 employees: 38%•5-99 employees: 32% •100-499 employees: 31%•Respondents drawn from national research panel, invited to participate by email

Qualitative Sample

22 respondents participated in 20-minute phone interview (March 17 - 26) • Provided more information on particular actions identified in quantitative portion of

survey

Google Confidential and Proprietary 4

Key Findings

• Small Business Owners rely on the Web to run their businesses.– 93% use the Web to find work-related information

– 54% go online at least weekly to solve a specific business problem

– Nearly half this audience uses the Web to research as well as purchase

• Search is the go-to source for SMBs making a purchase decision.– Search engines are the most relied upon, first-used, and most effective

tool for finding suppliers

– It’s more important that suppliers have an online presence than be local

• An emerging group of SMBs are finding business value in social media.– SMBs are using blogs, social networks, and video sites like YouTube as a

business information resource

The Role of the Web for Small Business Owners

Google Confidential and Proprietary 6

Radio

49%

Small Business Owners Rely on the Web

94% use the Internet for work-

related information

General Business Magazines

69%Newspapers

69%

Television

62%

Trade Publications

76%

Source: Slack Barshinger study commissioned by Google, “Procurement & Business Information Research,” March 2009Q: Which of the following sources do you use to get work-related information?

Google Confidential and Proprietary 7

SMBs Go Online Frequently for Business Advice

• 59% of Small Business Owners go online at least weekly to solve a specific business problem

• For 20%, solving business problems online is a dailyactivity

Source: Slack Barshinger study commissioned by Google, “Procurement & Business Information Research,” March 2009Q: How often do you go online to find information a bout how to improve various aspects of your business or to get information about how to solve a specific problem in your business?

Google Confidential and Proprietary 8

The Web: Part of SMB’s Typical Work Day

• Small Business Owners are online during business hours and beyond

.

0%

10%

20%

30%

40%

50%

60%

12am 1a

m2a

m3a

m4a

m5a

m6a

m7a

m8a

m9a

m10

am11

am12

pm 1pm

2pm

3pm

4pm

5pm

6pm

7pm

8pm

9pm

10pm

11pm

Source: Slack Barshinger study commissioned by Google, “Procurement & Business Information Research,” March 2009Q: Which hours of the day are you typically online for work reasons?

Hours of the Day When Small Business Owners are Online for Work-Related Reasons

Google Confidential and Proprietary 9

The Web Aids SMBs Across Purchase Funnel

Source: Slack Barshinger study commissioned by Google, “Procurement & Business Information Research,” March 2009Q: Which (purchase category) do you research or buy online?

46% of Small Business Owners

research onlinefor shipping/logistics

providers

51% of Small Business Owners

purchase onlinefrom shipping/logistics

providers

Google Confidential and Proprietary 10

27%

30%

43%

64%

41%

51%

45%

56%

35%

64%

61%

43%

69%

54%

31%

33%

39%

40%

43%

46%

48%

49%

49%

52%

55%

56%

58%

60%

0% 10% 20% 30% 40% 50% 60% 70% 80%

Professional services

Contractors

Printing services

Office supplies

Outsourced business functions

Shippping, supply chain, logistics

Telecom

Office equipment

Document mgmt services

Promotional products

Computers/IT hardware

Graphic/Web design services

Software

Webhosting services ResearchPurchase

Source: Slack Barshinger study commissioned by Google, “Procurement & Business Information Research,” March 2009

% who Research Online vs. % who Buy Online

Google Confidential and Proprietary 11

Web Visits Also a Top Response to Seeing an Ad

After seeing an ad, Small Business Owners respond most often by…

Source: Slack Barshinger study commissioned by Google, “Procurement & Business Information Research,” March 2009Q: What actions did you take in response to an ad?

Visiting the advertiser’s

website

Doing an online search to learn

more

Other actions:• Saving the provider’s

information (34%)

• Calling service provider via phone (30%)

• Asking network about the provider (17%)

59% 39%

Google Confidential and Proprietary 12

Search Helps SMBs Close the Loop

• SMBs indicate that many different events drive them online to search for more information

9%

10%

13%

14%

26%

27%

30%

39%

0% 5% 10% 15% 20% 25% 30% 35% 40%

Work-related radio program

Work related radio ad

Work-related TV program

Work-related TV ad

Work-related website ad

Work-related website

Work-related magazine ornewspaper

Conversation with a colleague

Source: Slack Barshinger study commissioned by Google, “Procurement & Business Information Research,” March 2009Q: During the past week, which, if any, of the following events have prompted you to use a search engine to find more information?

Events That Prompt SMBs to Use a Search Engine to Find More Information

Google Confidential and Proprietary 13

SMBs Visit Diverse List of Online Destinations

• Opportunity to reach this audience not just on major business portals, but throughout the long-tail

21%

30%

44%

44%

46%

47%

53%

79%

82%

89%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

Twitter

Photo sites

Video sites

Chat / Instant Messaging

Blogs

Social Networks

Forums

General news sites

Industry news site

Provider's web site

Source: Slack Barshinger study commissioned by Google, “Procurement & Business Information Research,” March 2009Q: How frequently do you visit each of the following websites for work-related reasons? (Any usage)

Types of Sites SMBs Visit to Find Work-Related Information

The Role of Search in SMB’s Purchase Decisions

Google Confidential and Proprietary 15

Search: The Go-To Source for Procurement

77% of Small Business owners

use Search engines to find

business suppliers

For 52%,Search engines

are the tool they turn to

first

99% find Search engines to be

the most effective tool

for finding suppliers

Source: Slack Barshinger study commissioned by Google, “Procurement & Business Information Research,” March 2009

#1 !

Google Confidential and Proprietary 16

Search Engines: Most Relied Upon Tool

• Search engines are used even more than past suppliers and referrals to find suppliers

21%13% 10% 6%

23%

50%

77%

33% 33% 32%

49%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Searchengines

Pastsuppliers

Asked forreferrals

Networking YellowPages

Onlinedirectory

Online Ad Online Map Chamber ofCommerce

SocialNetworking

sites

Other

Source: Slack Barshinger study commissioned by Google, “Procurement & Business Information Research,” March 2009Q: In the past 6 months, what methods have you used to locate product or service suppliers?

Methods Used to Find Suppliers in the Past 6 Months

Google Confidential and Proprietary 17

Search Engines: Tool Used First

• Small Business Owners indicate that a Search Engine is their go-to source for finding suppliers

15%

2%3%7%

52%

15%

4%

0%

10%

20%

30%

40%

50%

60%

Search engine Contacted pastsuppliers

Asked for referrals Printed YellowPages

Online directory Contacted peoplefrom networking

Other

Source: Slack Barshinger study commissioned by Google, “Procurement & Business Information Research,” March 2009Q: Which of these methods do you usually turn to first when looking for a service provider?

Methods Used First to Find Suppliers in the Last 6 Months

Google Confidential and Proprietary 18

Search Engines: Most Effective Tool

• Small Business Owners find Search Engines to be the most effective tool for finding suppliers

43% 41%32%

75%

52%55%64%

99%

77%

50%

0%

20%

40%

60%

80%

100%

120%

SearchEngine

Asked forreferrals

Contactedpast

suppliers

LocalChamber ofCommerce

Used onlinemap

Networking YellowPages

Provider ad Onlinedirectory

SocialNetworking

sites

Source: Slack Barshinger study commissioned by Google, “Procurement & Business Information Research,” March 2009Q: How effective was this method for finding a supplier?

Methods Found to Be Effective for Finding Suppliers in the Last 6 Months

Google Confidential and Proprietary 19

SMBs Find Value in Sponsored Links

One-third of Small Business Owners searching for providers often or always click on paid search listings

Source: Slack Barshinger study commissioned by Google, “Procurement & Business Information Research,” March 2009Q: When using search engines to find service providers, do you…(often/always clicks on paid listings)?

Google Confidential and Proprietary 20

28%

28%

28%

29%

29%

30%

30%

30%

31%

33%

33%

33%

33%

34%

36%

0% 5% 10% 15% 20% 25% 30% 35% 40%

Total

Office Supplies

Office Equipment

Software

Professional Services

Promotional Products

Printing Services

Computers/IT

Web Hosting Services

Graphic Website Design

Contractors

Telecom Services

Shipping/Logistics

Outsourcing

Document Mgmt

% of SMBs who click on Paid Listings When Researching a Supplier

Source: Slack Barshinger study commissioned by Google, “Procurement & Business Information Research,” March 2009

Google Confidential and Proprietary 21

Online Maps Help SMBs Find Suppliers

Of the nearly 20% of Small Business Owners who use online maps to find suppliers…

Source: Slack Barshinger study commissioned by Google, “Procurement & Business Information Research,” March 2009Q: Have you used an online map to find suppliers?

A small group accesses

maps from their mobile device

21%

They often click on a map that appears

in Search Results

54%They typically go directly

to an online map site

90%

Google Confidential and Proprietary 22

However, Local Not Priority When Choosing Suppliers

% who say it is important for supplier to be local

• Majority of categories do not place high importance on a supplier being local

2%

4%

7%

9%

9%

10%

12%

12%

13%

15%

18%

24%

39%

42%

0% 10% 20% 30% 40% 50% 60%

Webhosting Services

Software

Promotional Products

Computers / IT hardware

Outsourced business functions

Shipping, supply chain, & logistics services

Telecom service or equipment

Document management services

Graphic and/or Website design services

Office equipment

Office supplies

Printing Services

Contractors

Professional services

Source: Slack Barshinger study commissioned by Google, “Procurement & Business Information Research,” March 2009Q: Is it important to find a local supplier? Base: Those involved in the purchasing category and do research or buy online

Google Confidential and Proprietary 23

Price, Availability Outweigh Local Presence

“...Local companies just can’t match price and breadth of products.”

“I would prefer to do anything with a local vendor but unfortunately, cost-wise that is not always feasible.”

Wholesale distributor of bicycle parts2-4 employees, California

Source: Slack Barshinger study commissioned by Google, “Procurement & Business Information Research,” March 2009

“... No one locally can accommodate what I am looking for.”

“They don’t have all the supplies I need, and I usually have to wait 2 weeks for a large order. I have a specific thing I need and it’s quicker to get that online.”Music studio owner25-49 employees, Maryland

Pressure washing50-74 employees, Tennessee

Fitness equipment manufacturer100-499 employees, Missouri

Social Media as an SMB Information Tool

Google Confidential and Proprietary 25

SMBs Find Business Value in Social Media

I seek various

business resources on video sites

44%

I visit social networking sites for business purposes

47%

I seek out work-related information on

blogs 46%I visit

online forumsfor business-related

info

53%

Source: Slack Barshinger study commissioned by Google, “Procurement & Business Information Research,” March 2009

Google Confidential and Proprietary 26

Blog Usage Growing Rapidly Amongst SMBs

Despite a slower adoption rate, participation in blogs for business purposes have skyrocketed in the last 12 months

Source: Warrillow Market Insights, April 2009, n=1,210; March 2008, n=2,036

18%in

2008

40%in

2009

Google Confidential and Proprietary 27

SMBs Are Active in the Blogging Community

Source: Warrillow Market Insights, April 2009, n=1,210; March 2008, n=2,036

46%of Small Business

Owners visit blogs to find

business information

Of those, 13%

maintain their own blog to

promote their business

Google Confidential and Proprietary 28

SMBs Find Value in Social Networks

Source: Warrillow Market Insights, April 2009, n=1,210; March 2008, n=2,036

47%of Small Business

Owners visit Social

Networks for business

information

Of those,40%

maintain a profile for business purposes

Google Confidential and Proprietary

Customer Research 32%

Customer Feedback 30%

Tutorial, How-to videos 46%

Business & Finance News

35%

Competitor Research 35%

Conference events 17%

29

Online Videos Provide Business Information

Source: Slack Barshinger study commissioned by Google, “Procurement & Business Information Research,” March 2009Q: Which, if any, of the following types of work-related information do you typically look for on video sites like YouTube?

Types of Information SMBs Seek on Video Sites

Customer Research 32%

Customer Feedback 30%

Google Confidential and Proprietary 30

Key Findings

• Small Business Owners rely on the Web to run their businesses.– 93% use the Web to find work-related information

– 54% go online at least weekly to solve a specific business problem

– Nearly half this audience uses the Web to research as well as purchase

• Search is the go-to source for SMBs making a purchase decision.– Search engines are the most relied upon, first-used, and most effective

tool for finding suppliers

– It’s more important that suppliers have an online presence than be local

• An emerging group of SMBs are finding business value in social media.– SMBs are using blogs, social networks, and video sites like YouTube as a

business information resource

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