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SMB Data Point of the Week: New Businesses Heavy Users of Free or Low Cost Advertising

by | May 4, 2016 | BIA, Blog, SAM, SMBs

New businesses* are heavy users of free or (relatively) low cost advertising, according to BIA/Kelsey’s Local Commerce Monitor™ (LCM) survey of SMBs. While most of the small- and medium-sized businesses in the survey report using a Facebook page and website for advertising and promotion, the top 5 media used by new businesses (as shown in the chart below) have free or low cost solutions.

This isn’t to say that they don’t pay for advertising — the smaller, or Core**, new businesses spent an average $1,124 annually on advertising and promotion last year. Their most popular paid channels for advertising were direct mail, direct to home (door hangers, flyers, brochures that are delivered to homes but not mailed), giveaways and newspapers.

Companies who offer a free, trial or low cost offer attract new businesses but often times overlook their multi-channel investment in traditional targeted media. New businesses have a strong need to build their brand in local and companies who offer them direct targeted products will grow with them as they move from new to established businesses who spend more on advertising.

New SMBs - S11


* SMBs that picked “beginning to get established” when asked about their lifecycle stage.

** Core SMBs spend less than $25,000 annually on advertising and promotion.


BIA/Kelsey’s LCM, Wave 19 reports can be purchased a la carte in the new BIA/Kelsey eStoreOur LCM reports look at where particular SMBs (broken out by size, vertical, etc.) spend the most, as well as the top channels for marketing and advertising. Additionally, our reports provide analysis on the best product and service offers for highly coveted groups of SMBs.