A Clear Message for Vendors In the SMB Technology Market

We recently wrapped up the SMB Group’s “2010 Small and Medium Businesses Routes to Market Study”, which uncovered quite a few interesting trends about how SMBs discover, learn about, evaluate and buy technology solutions and services. We are publishing free research briefs on the SMB Group site on some of the key findings, including Social Media: Shaking Up the Way Small Businesses Evaluate and Purchase Technology Solutions and Services, and SMB Business Outlook and Plans to Invest in Technology Solutions and Services, which are available here.

Another finding that I find quite fascinating is how frustrated and confused many SMBs are about technology solutions. Survey respondents indicated that their top two technology challenges are figuring out how different types of solutions can help their businesses, and getting better insights out of the data they already have:

  • Top technology challenges for small businesses:
    1. Get better business insights from existing data: 35%
    2. Figuring out how different solutions can help the business: 32%
    3. Implementing new solutions/upgrades: 32%
    4. Integrating social media with Web site, marketing tools, etc.: 24%
  • Top technology challenges for medium businesses:
    1. Get better insights from existing data: 33%
    2. Figuring out how different solutions can help the business: 32%
    3. Integrating social media with Web site, marketing tools, etc.: 32%
    4. Implementing new solutions/upgrades: 30%

As you can see from the above data points, SMBs view figuring out what solution can best help the business and getting better insights from existing data as bigger challenges than implementing a new solution! Scarily, these challenges are just as significant in medium businesses as in small ones, despite the fact that most medium businesses have IT staff, larger IT budgets and better access to external technology advisors.

Clearly (no pun intended) this confusion and frustration creates a huge, and in my view, a vastly under-rated (by most vendors, anyway) inhibitor to SMB technology adoption. It reinforces my belief that any company trying to sell into the SMB market needs to do some serious self-evaluation,  as I discussed in my post earlier this year, Does Your SMB Marketing Message Need a Makeover? Seven Questions to Ask.

SMB requirements for clarity, transparency and a demonstrable value proposition will become even more intense as more SMBs starting shifting from generic search engines to application marketplaces/app stores and social media to learn about, evaluate and buy solutions. These newer channels provide more and better context for SMB customers, and provide a source of unbiased insight about other customers’ actual experiences with solutions.

While our study shows that search engines are the top information source for SMBs today, social networking site such as LinkedIn, Twitter and Facebook are gaining momentum at a rapid rate. And, although SMB app stores are an even more recent phenomenon, our findings indicate that a majority of  SMBs are aware of and using/planning to use them. Among small businesses, 23% use them and 29% plan to use app stores; while among medium businesses, 44% use app stores and 24% plan to use them.

With so many products and solutions competing for SMB mind and wallet share, and new information sources and channels that are making it easier for SMBs to sort through the clutter, vendors need to redouble their efforts to clearly describe their solutions, provide solid evidence of how it can help businesses achieve their goals, and clarify how it differs from competitive offerings. Otherwise, the market–with the help of social media and app stores–will do it for them.

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