Social search overtakes traditional directories for new customer acquisition

16/05/2012

In the digitally advanced markets, social is moving ahead of directories as the main way small businesses get new customers. Latest research in the UK shows the scale of the channel shift, with more than a third of small firms are using Facebook for marketing (vs 27% using local directories). Twitter is also playing a growing role, with around a sixth of firms claiming they actively use it to recruit customers. The newness of social channels for small firms is under-researched in most countries, but findings from the UK could be indicative for other digitally advanced markets.

The report from tech company BaseKit found social networks have overtaken local directories such as Yellow Pages as the main way small businesses find new customers.

More than a third of small firms said they use Facebook for marketing, compared to 27% that rely on local directories, while one in six scout for clients via Twitter.

Facebook has proven to be a more popular source than local business directories as well as print and online advertising.

The research reveals that 36% of small businesses in Britain used the social networking site for marketing purposes.

Twitter is also a popular source for small businesses to create new customers with 17% using the micro blogging site.

The growing use of Twitter by businesses could meet the site could pass online and print advertising in the near future.

Simon Best, co-founder of BaseKit says businesses are increasingly making the shift from using traditional directories to using social media for marketing purposes.

"Small businesses are shifting their marketing to lower-cost media like Facebook and Twitter and away from legacy media like the directories," said Best. "They tell us that one-to-one marketing is their most efficient and most successful way of generating new business - the fact that Facebook has become the number one source of new business within just a few years of its creation is remarkable."

A social media presence has increasingly become a necessity for building brand reputation and reaching out to customers with 74% of businesses saying social media marketing is critical to their company.

"The simple truth is that, for a small business with customers who may be under 40, if you're not on the web then you are more-or-less invisible," said Best. "We believe that every small business in the UK should be able to take advantage of the power of the internet as a tool to grow - and should be able to create a professional website cost-effectively."

“There’s a revolution in small business marketing”, explains Danny Meadows-Klue, chief executive of the Digital Strategy Consulting group who has been tracking social media trends for a decade. “The smaller the firm, the closer the relationship between marketing and sales, and often the greatest freedom to innovate. These agile businesses understand how the context of marketing is changing and are adapting their approach much quicker than many multi-nationals. We’d expect to see consistent trends in the digitally advanced markets of North America, South East Asia and the Far East. For consumers who select a portfolio of local businesses as suppliers, there’s value in ‘following’ them through Twitter and Facebook, and a much greater richness in the quality of information than the blunt implement of a Groupon offer basket that increasingly brings people loyal to the offer but not the person making the offer.”

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