In the early days, Internet Marketing would conjure up charming images of David valiantly fighting Goliath. In recent times however, that fable doesn’t seem to have a happy ending. Digital is no longer considered as a guerrilla marketing spend, but an accepted norm in marketing budgets of companies. Global trends indicate digital spend has increased by over 30% of overall advertising budget in the last three years and has crossed over $140B in 2015 (Techcrunch), with search and display ads almost evenly split.
With the rise of internet businesses, businesses are now having to compete with Global counterparts at a more localised scale than ever before. For instance, a local realtor might have to compete with AirBnB or the local cab company might have to compete with Uber. Given the hyper-growth nature of these businesses, large amounts of advertising dollars are being spent to prioritise scale over profits. ROI seems to have shifted to user registrations and active users than revenue. And it is without a doubt that majority of their advertising budget will be spent online.
What does this mean to small businesses?
For starters, digital is no longer an afterthought. Needless to say, businesses will ramp up advertising spends. But, that could be a bloody battle, given that they will have to compete with much larger budgets. A smarter approach would be to compete on local expertise and culture. Small businesses have been aping social behaviour way before it was online. Think about it. You walk into your local coffee shop, the barista greets you, s/he knows your drink, you exchange conversations and go about your day.
There is an inherent trust and knowledge in the aforementioned transaction that larger businesses, hitherto inanimate and cold, have tried to mimic through social media and internet marketing (closing the customer feedback loop). Consider also, the fact that small businesses understand local trends far more intimately than other competing businesses. Given their access to advertising dollars, larger businesses are less prioritised to innovate (a reasonable premise). If small businesses shift some of the conversations and expertise online, they can extend beyond patrons to local communities and beat the Goliaths at Internet Marketing.
The game is afoot.