SMBs Reap E-Commerce Benefits

By Sean Michael Kerner | Posted May 19, 2005

It should come as no great surprise that small and medium-sized businesses view the Internet and e-commerce as important business elements. But a new study from the ISP Interland shows a much more detailed look at how e-commerce affects SMBs.

According to the Interland Spring 2005 Business Barometer, e-mail is critical to 70 percent of SMBs, 94 percent of which have Internet access (64 percent broadband and 30 percent dial-up).

Two-thirds of the 1,032 SMB owners surveyed by Interland noted that their Web sites influenced online and offline sales.

The degree to which their Web sites contribute to their bottom lines is not insignificant. Forty-four percent of respondents with sites indicated they derived anywhere from one-to-25 percent of their total 2004 revenues from their sites (either directly through e-commerce or by influencing offline purchases).

Twenty-four percent of respondents reported that 26-to-100 percent of their 2004 revenues were the direct or indirect result of activity generated via their Web sites.

Of the SMBs surveyed that actively provide e-commerce services on their sites (24 percent of survey respondents), 42 percent earn more than a quarter of their total monthly revenue via their Web site.

SMBs rely on a variety of marketing tactics online to get their messages across and their products sold. Twenty-one percent use e-mail marketing, 18 percent employ search engine keywords and five percent use Web banner advertising.

As with virtually every online demographic segment, SMBs rely heavily on Internet search, with only two percent reporting that they never search online. The majority of SMBs (54 percent) are loyal to one particular search engine, and they usually rely on the same engine for each search.

While SMBs site local business search as one of the most popular uses for Internet search (50 percent search for businesses online), that doesn't preclude SMB from using other traditional forms of business directories.

Forty-seven percent of respondents still use the Yellow Pages to search for local businesses; two percent use directory assistance, and a scant one percent just drive to the area where they think they'll find the business they're looking for.

Adapted from Internetnews.com.

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