Facebook has partnered with Deloitte to publish a new report which looks into the challenges faced by SMBs over the past year, and how they've increasingly turned to digital platforms to maintain connection with their audience, through various means.
The 44-page report, which incorporates responses from over 30k SMBs from around the world, specifically looks at how personalized ads and social platforms have assisted various brands, with examples and case studies to illustrate the key points.
You can download the full report here, but in this post, we'll take a look at some of the highlights.
First off, in looking specifically at the benefits of personalized ads and advanced targeting models available on digital platforms, the research shows that 74% of SMBs that are using personalized ads reported that these advertisements were important to the success of their business.
As per the report:
"A similar trend was observed among respondents using personalized ads on the Facebook apps, with 73% reporting that they were important in growing their business successfully. SMBs using personalized ads in developing countries, including Indonesia (88%), India (84%) and Mexico (81%), were particularly likely to emphasize their importance to the success of the business."
The numbers underline Facebook's core case in its opposition to Apple's recent IDFA data tracking update, which now prompts all users in regards to in-app data tracking, and gives them the opportunity to opt-out of such, if they choose. Facebook claimed that Apple's update would end up hurting small businesses the most, because if a lot of people do switch off data tracking as a result of these prompts, as is the expectation, then that will reduce its capacity to provide accurate audience targeting tools within its ad options, which will eventually reduce ad effectiveness and drive up costs.
Those impacts will be most felt by SMBs, who have far lower ad budgets, and these figures show that SMBs are definitely growing to rely on advanced data targeting for their marketing campaigns, helping to drive expansion.
Of course, the IDFA update has been rolled out anyway, but it will be interesting to see whether, and how much, the cost of Facebook ads increases as a result, and what the flow-on effects for smaller brands will end up being.
The report also shows that SMBs that are using social media were 2x as likely to report that more than half their sales came from overseas customers, underlining the expanded reach benefits of the medium, while SMBs using personalized ads were also more likely to report higher sales growth in the past year.
Facebook has been working to create a more 'borderless' marketing platform for years, which could greatly expand the opportunities for all SMBs, and these numbers highlight that potential, which could become even more relevant as Facebook moves more towards eCommerce and facilitating in-stream sales in its apps.
Branching into international markets will always offer significant potential in this respect, and the more Facebook can simplify and improve this process - like, say, through universal payment systems like Facebook Pay, or its own Diem cryptocurrency - the more businesses will come to rely on the platform as a key cog within their broader sales process.
The study also shows that more brands are now tapping into social listening and crowdsourcing online as a means to improve their product and marketing approaches.
"This includes both informal interactions on social media platforms, such as Twitter or Facebook, and formal information exchanges on dedicated platforms, such as OpenIDEO. The Facebook apps (including Facebook, Instagram, WhatsApp and Messenger) were recognized as particularly important to SMBs in their early stages, with 64% of SMBs using the Facebook apps reporting that they were important for obtaining feedback."
This is a key benefit of social media marketing - the capacity to tune in to what people are saying around your niche, and learn from these conversations to revise your approach, while UGC can also be hugely effective in maximizing your brand messaging, and establishing connection with fans.
On another front, the data also shows that more businesses are leaning on digital platforms for hiring and e-learning, with most SMBs now using social platforms to hire in some capacity.
That's a key point of note - moral and ethical considerations aside, these days, it's a pretty safe bet that hiring managers are going to look you up on social media as they go through their hiring process.
Businesses are also, of course, using social platforms to connect with relevant candidates through colleague recommendations and job ads, but a part of this also incorporates research and backgrounding, which is now a determining factor in many cases.
The report also looks at broader social media strategy approaches, and how they can benefit business.
There are some interesting notes and insights here, and some key considerations for your marketing strategy, even if only in a benchmarking sense. The feedback from other SMBs provides more context as to how others are responding to the impacts of the pandemic, and that could help in your planning, moving forward, or highlight new opportunities that you hadn't considered.
You can download the full "Unlocking small business innovation and growth through the rise of the personalized economy" report here.