Why Web Marketing Favors Small Businesses

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SmallBusiness.pngIt wasn't long ago that small businesses didn't talk much about marketing. Taking out an ad in the Yellow Pages or printing a few brochures for the trade show was about it. But the Web has changed everything. Not only can small businesses use the Web to do more marketing than they ever dreamed of, but the Web actually creates an environment that allows small businesses to succeed, even against larger competitors. Don't believe me? Read on.

Now, I don't mean to say that small businesses dominate large ones on the Web. They don't. But the Web is far more of a level playing field than any other form of marketing, because TV, radio, print, direct mail, and just about anything else you can think of requires money. Sometimes enormous amounts of money. Money that small businesses don't have. (In fact, if a small business ever got that kind of money, it would only be by becoming a large business, so I rest my case. Uh, I'll get back to the point now, I swear.)

So why do I say that Web marketing favors you, the small businessesperson?

  1. Because you don't have any money. Yeah, I know you have never thought of this as an advantage, but hear me out. (I'm not sure why it's no good for you to "hear me in," but just listen, OK?)

    Big companies have grown up knowing that having money is what makes their marketing successful. They can buy more ads, hire more PR people, and get more attention because they have the cash. But money isn't the sole driver of Web marketing success—it's not even the most important one.

    Most of the good stuff on the Web is free, so you don't waste your time on the stuff that that costs money and doesn't work. Today, everyone knows banner ads aren't worth much, but ten years ago big companies were spending huge amounts on them. I've seen big companies waste millions on Web sites done in Flash that search engines think are invisible. Paid search used to be a real bargain, but as it becomes more expensive, who gets out first? That's right.

    The most important success factor in Web marketing is having ideas that your customers care about, and money isn't particularly helpful there. In fact, the more money you want to put behind an idea, the harder it will be to decide which idea is the right one. You'll end up with the safest idea rather than the best one. That's what usually happens to big companies on the Web.
  2. Because you aren't trying to impress your boss. Too much of what big companies do is designed to curry favor with bigwigs and has nothing to do with finding customers and making them happy. You are the boss, so you know that if it isn't about customers it isn't important.

    Now, maybe all the money going into Second Life has real return on investment, but I think some of it is just to impress the boss. It could be that all those fancy Web redesigns bring real revenue, but I think sometimes they are done just to put a new coat of paint on each year—or else the executives think no one did anything.
  3. Because you aren't afraid to fail. You won't get fired. You know that it just means you need to try something else. That attitude is rare in big companies because they have a lot more to lose, they think. In truth, failing to experiment is the biggest failure.

    Have you ever asked yourself why big companies need small companies buzzing around them to sell their products (business partners, dealers, value-added resellers—geez, I should hope we are all adding value)? It's because they have gotten too big to be able to do it themselves. Big companies need small companies because they do their experimentation for them. Small companies don't need big companies because on the Web a small company can seem just as substantial as a big one.

    Keep trying things and you'll soon have a better answer than the big company has. They'll keep running task forces and paying consultants while you are testing what actually works. Trust me, the best "best practice" is to try things and see what works the best in your situation. Big companies are too proud to risk looking foolish by trying things that don't work. So they constantly play it safe and do not find the real breakthroughs.

So, the next time you are upset about how hard it is with no money, remember that it could be worse. You could have money, and all the rest of the drek that goes with it.


I agree with your three very valid points, but small business online marketers also have to be more multi-faceted and self-assured in their internet skills than large companies.
Large companies have the advantage of an online marketing team while small businesses have an online marketer, or if they're lucky, a small team. So while small businesses have the advantages you mentioned, their disadvantages make their progress almost as slow as their larger online competitors.
So while it is a level playing field, small businesses are still pitching into the wind, but as you point out, this is a huge step up.

Good points. I would expand Web marketing to include the exploding selection of on-demand applications and communications that let the smallest business build a professional public "face."

Five years ago the typical small business website was an online version of the Yellow Pages ad. Now small businesses can add features like personalization that were cost-prohibitive not that long ago. They can add interactive features like click-to-call and integrate that call with business applications. They can get information about where site visitors come from and what they were looking for. All of this helps small businesses keep the personal touch that is one of their most important competitive advantages.

I'm not sure I'd say that web marketing favors small business. The more resources, the easier it is to generate traffic. But efficient use of resources on the web can get many more times the bang for the same buck. I'd view the web as a place where the small guy has a shot in small defined nitches against the bigs. I can never take on Amazon selling books, for instance. But there are small online book sellers who focus on a very narrow genre--i.e., vampire erotica.

Hi Mike,

Good article, but a point of clarification: banner ads do work -- but for branding purposes, not direct response purposes. People see the ads and it adds to overall brand visibility, although they may not click on the ads right then and there. MarketingSherpa did a study on this recently.

Large corporations can afford branding campaigns via banner ads, and so for them, banner ads work. Small businesses are better off going with direct response vehicles, such as pay per click ads and affiliate links. Most can't afford a big branding campaign.




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This page contains a single entry by Mike Moran published on June 12, 2008 9:06 PM.

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