Fifth Wave of Network Solutions Small Business Study Reports Optimism Among Small Businesses at a Two-Year High

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The Small Business Success Index, sponsored by Network Solutions® and University of Maryland Robert H. Smith School of Business reveals that along with their optimistic outlook, small businesses are ready to hire and increase their investments in technology.

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We are glad to see the SBSI reflecting a new kind of optimism for growth this year among our customers and the small business market in general

The future is looking brighter for U.S. small business. The fifth wave of the Small Business Success Index, a survey sponsored by Network Solutions® and the University of Maryland’s Robert H. Smith School of Business revealed that optimism among small businesses is at a two-year high. More small business owners believe the economic climate is “improving” rather than “worsening” and with this financial and psychological improvement, small businesses have returned to investing in technology. Adoption of social media has increased among small businesses, yet many have reevaluated their initial expectations, finding the true value in engagement and brand awareness.

“Starting a business is probably one of the most difficult tasks an individual can undertake,” said Tim Kelly, Network Solutions’ CEO. “We talk to small business owners all the time, and it’s amazing how positive, resilient and resourceful they are – even during an economic downturn. We are glad to see the SBSI reflecting a new kind of optimism for growth this year among our customers and the small business market in general.”

Social Media Adoption Increases

From June 2009 to June 2010, social media adoption lulled, remaining stagnant at 24 percent. However, the second half of 2010 marked a growth period, with nearly one-third of small businesses utilizing social media.

The Small Business Success Index revealed the following statistics on social media usage:

  •     27 percent use Facebook®
  •     18 percent use LinkedIn®
  •     8 percent use location-based services (Facebook Places, Foursquare™, Gowalla®, etc.)
  •     8 percent use blogs
  •     7 percent use Twitter®

On the other hand, with this increase of use, more small businesses have found that social media is not meeting their expectations. Thirty-six percent feel that so far, their use of the medium has fallen short of expectations, while only 9 percent feel it has exceeded expectations. Even so, small businesses are still finding value. In the past 12 months, owners have made key accomplishments with social media, including: staying engaged with customers (63 percent), developing a higher awareness of the business in the market (61 percent), and identifying and attracting new customers (59 percent).

Marketing Success Drops, Web-Based Technology Increases

In the past six months, the perceived importance of Internet business solutions grew, as 42 percent of small business owners revealed that they consider Internet business solutions highly important to their success, compared to only 33 percent in June 2010. More than half of small businesses (56 percent) now have websites, a significant increase from 46 percent a year ago. Search engine optimization (SEO) is a priority for small businesses—27 percent use an SEO plan compared to 19 percent one year ago.

As for the future, in the next two years:

  •     Nearly half expect to have a social media presence (46 percent)
  •     66 percent expect to have a website
  •     36 percent expect to have an SEO plan

“We took our web marketing strategy very seriously last year and invested in SEO to increase our site traffic. This contributed to a six-fold increase in the enquiries we received online,” said Kristina Bouweiri, president and CEO of Reston Limousine, a small business based in Reston, Va. “A good web strategy combined with a regular social media engagement plan can pay huge rewards in terms of online presence.”

Positive Economic Outlook

Optimism for the future is at an all-time high. For the first time in two years, more small business owners think the economic climate is “improving” rather than “worsening” (35 percent compared to 19 percent). Small businesses are also more optimistic about the outlook for the economy in the next 12 months than they were a year ago, with only 15 percent believing the economy will decline compared to 26 percent who believed this a year ago. Also, the number of small business that felt they were impacted by the recession peaked last year and has started to decline.

Visit http://www.networksolutions.com/smallbusiness to download a full copy of the Small Business Success Index Wave-5.

About Network Solutions®

Network Solutions® fosters small business success in the highly competitive online space by providing the tools and resources to start, grow and manage businesses online. Leveraging more than thirty years of pioneering experience, Network Solutions helps companies thrive in an increasingly digital world. To ensure our customers’ success, we support them with outstanding customer service and solutions that are simple, innovative and reliable. Additional information can be found at about.networksolutions.com.

About the University of Maryland’s Robert H. Smith School of Business

The Robert H. Smith School of Business is an internationally recognized leader in management education and research. One of 12 colleges and schools at the University of Maryland, College Park, the Smith School offers undergraduate, full-time and part-time MBA, executive MBA, executive MS, PhD and executive education programs, as well as outreach services to the corporate community. The school offers its degree, custom and certification programs in learning locations in North America and Asia. More information is available at http://www.rhsmith.umd.edu/.

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Shashi Bellamkonda
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