Study Shows Small Businesses Embracing Social Media

By Beth J. Bates, New Media Special Correspondent

While opinions differ on whether Twitter is a useful business tool, one thing is for certain: small businesses are embracing social media.

A recent study, The State of Small Business Report, by Network Solutions and the Center for Excellence in Service at the University of Maryland’s Smith School of Business reports "social media adoption by small businesses has doubled from 12 percent to 24 percent in the last year." While this statistic may seem surprising, it really makes sense.

The typical small business owner generally has a small marketing budget. Social media enables companies to extend their customer reach with minimal expense. Small businesses need to connect with their customers on a personal level — which social media provides. And with the widespread adoption of social media as a standard tool for communication, it's very accessible and effective for business.

As with any technology, the report described both positive reactions and concerns about social media.

Small business owners use social media to attract new customers:

• 75% surveyed have a company page on a social networking site.
• 61% use social media for identifying and attracting new customers.
• 57% have built a network through a site like LinkedIn.
• 45% expect social media to be profitable in the next twelve months.

Small business owners still have concerns with social media, however:

• 50% of small business social media users say it takes more time than expected.
• 17% worry that social media gives people a chance to criticize their business on the Internet.
• 6% feel that social media has hurt more than helped the image of their business.

While small business owners are showing some caution toward adoptng social media, the study shows that most are willing to give it a shot with the expectation that they will reach their long term goals.

Are you using social media to connect with customers and build relationships? Has it hurt or helped?

Beth J. Bates consults with Hinge on social media tool selection and strategy and helps its clients find effective ways to leverage these new mediums to meet business goals.