In The Spotlight: The Mobile Gap: Why U.S. SMBs Are Missing Out on $1 Trillion in 2014
By Matt Anderson, Chief Digital Officer, hibu
What if I told you that small and medium-sized US businesses would miss out on $1 trillion in revenue this year? If you’re one of the small business owners who could be capturing that revenue, you’re probably wondering what significant change or investment you need to make. A big advertising campaign? New technology to streamline your work? The answer is likely to be smaller than you think. In fact, you might be holding it in your hand right now. That $1 trillion all comes down to the mobile web.
At hibu, we work with small and medium-size businesses (SMBs) on a daily basis, and we’ve suspected that they were struggling when it came to the mobile web but wanted to quantify the extent. So with help from Impact Research, we set out to find out exactly where SMBs are on the path to mobile.
We talked to 900 SMB owners and IT decision-makers across the country, spanning industries ranging from retail to healthcare. First, we asked them if they had a mobile-optimized website—that is, one that can be easily viewed and navigated on a mobile phone or tablet with no pinching or twisting of the screen required. We discovered that very few do—only 9 percent, in fact—and only 3 percent have websites that can handle mobile transactions. And believe it or not, 45 percent of US SMBs still don’t have a website at all.
Next, we asked the 91 percent of SMBs without mobile-optimized websites what they thought that implementing a mobile-optimized website would mean for their bottom line. They predicted that creating a website that works with mobile phones and tablets would grow their revenue by an average of 4 percent. I think that’s a conservative estimate (just reflect on how often you use your phone when you’re out and about to look for a local business), but even that 4 percent could equal $1 trillion across the nation’s SMBs. The truth is that when your website can’t be viewed on a mobile phone, you might as well have a “Sorry, We’re Closed” sign hanging on the front door of your business.
It’s clear that SMBs know the value of the mobile web, and they also know it is growing. The decision-makers we spoke with told us that across all sales channels, online mobile transactions would have the biggest increase in 2014, with a projected annual growth of 630 percent.
Taking all of these facts into account, you’d expect that SMBs would be rushing to make their websites mobile-friendly, but the truth is that most aren’t. We discovered that only 12 percent of those without a mobile-optimized website plan to build one in the next 12 to 18 months.
The question, then, is why? If SMB owners know that mobile is the future and that it has the potential to make a huge difference in their profits, why aren’t they making the move to mobile? Based on what I see in the SMBs I work with, I suspect the hesitation is because people don’t know where to start.
SMB owners wear a lot of hats and adding the “designer” and “webmaster” hats to a list of titles that may also include “President,” “office manager,” “shipping and receiving” and “HR director” is sometimes just too much. Add to that the fact that the Internet is never static—it’s constantly changing, and what’s a best practice today for design or search engine optimization may be long outdated in six months or a year—and it’s a lot to manage.
The mobile revolution is a great example of the web’s constantly evolving nature. Ten years ago, nobody was looking at your restaurant or hardware store’s website from their cell phone. Today, 56 percent of US adults use a smartphone, and 82 percent have browsed the Internet on their phones, so it’s essential that your website is easily found and navigated on a phone. And the search terms that potential customers will use to find your business are completely different depending on whether they’re using their phone, tablet or computer, which means your ad buys and search optimization need to be targeted accordingly.
So today’s SMB owners are caught in a conundrum. They see the mobile growth trend, but they do not know how to grab hold of the trend to benefit their business. A lot of them feel intimidated and don’t know where to start to get a mobile-optimized website, or they think the process is much too complicated for them.
There is hope. Here are a few things that SMBs can do to take advantage of the mobile web so that $1 trillion will no longer be lost:
First, take an honest look at your current mobile capabilities. Visit your website on your phone. Does it take more than three taps to get to your mobile-optimized version? If so, it might as well not exist—most people won’t go any further.
When your customers visit your store, ask how they found you. On a mobile site? With a cell phone or tablet? Did they research your company before they arrived? Knowing how your customers are using mobile can help you develop your strategy.
Use key mobile directories. You need to advertise in the right places where mobile traffic is accumulating and drive it back to your site.
Matt Anderson leads the Digital Business Unit at hibu and holds responsibility for the development of all digital solutions, embracing digital marketing, online commerce and business operations for the company’s SME customers. He is also responsible for hibu’s internet Yellow Pages (iYP) products and its Consumer, Payments, Incubator and Latin initiatives. Anderson joined hibu in January 2012 as Chief Strategy and Business Development Officer from Booz & Co. As a partner in the consumer media and digital practice, he led cutting-edge work in the E.U., U.K. and U.S., helping companies adopt and create business value from the latest digital and technology trends in eCommerce, social media, mobile, and digital media and marketing. He has worked globally with several Fortune 100 companies on major corporate transformations.