Small Business Labs

Survey on Traditional Mail Versus Email

Entrepreneur Daily posts on a survey on consumer attitudes towards traditional mail and email.  Conducted by ICR and sponsored by Pitney Bowes, the majority of survey respondents preferred to receive marketing communications through the traditional mail.  Key quotes from the blog post:

"73 percent of respondents prefer to receive new product announcements and offers from companies they do business with by mail."

"70 percent prefer receiving unsolicited product and services promotional info by mail."

Traditional mail clearly can still be effective.  This is particularly true if the targeted consumers don't have Internet access or don't actively use the Internet - and a lot of Americans fall into these categories.  Pew/Internet has a study that segments Americans by technology use.  Key quote from the study summary:

"49% of Americans only occasionally use modern gadgetry and many others bristle at electronic connectivity"

Franchising Management On My Time, On My Terms

The StartUpJournal has an interesting article on changes in the franchising industry.  The article covers a number of topics, including the importance of work/life balance and work flexibility in attracting franchise owners.  Key quotes:

"Today, there are absentee owners who oversee their operations from laptops and Treos, and owners who maintain dual careers or run multiple franchises."

"In part, the attitude shift is born out of necessity, as franchisers look to attract the best business talent in a digital age where working remotely is an accepted job perk, both among baby boomers who may be looking to slow down, and among younger workers who demand more work-life flexibility."

A good example of the trend towards On My Time, On My Terms management, which is covered in our most recent report.

I first saw this on Jeff Cornwall's Enterpreneurial Mind blog.

The Butler Boom

The Week Magazine has an article called "Inside the Butler Boom" which is adapted from the book "Richistan".  The article, which is not available online, talks about the swelling ranks of the rich and the growing number of services pampering them.

The article focuses on the growing demand for butlers - now called "household managers" - and the Starkey International Institute for Household Management, which trains butlers.  Key quote:

"They learn how to clip a 1926 Pardona cigar, how to dust a de-Kooning canvas, and how to pair an oaky Chardoneey with the roasted free-range game hen ..... and that Bentley's should never, ever be run through the car wash."

While only the ultra rich can afford butlers, personal services for the not so rich appear to be growing rapidly.  Time pressed people from all income levels are increasingly willing to outsource daily tasks, and small businesses are often best positioned to provide these services.

Over the next few months we are going to look at the growth of personal services in more detail.  If you know of data or information sources on personal services please let us know. 

Intuit Future of Small Business Report 2nd Installment: Technology Trends and Small Business

The 2nd installment of the Future of Small Business forecast series is available.  The report covers technology trends and their impact on small business formation, operation and marketing.  The report focuses on the reality of online and connective technologies catching up to the hype that has surrounded this sector for the last decade.  Key quote from the report overview:

"The next decade will the see reality of technology catch up to the hype of the last decade."

The report also discusses the impact of connective technologies on small businesses.  Key quote:

"As the digital infrastructure matures and becomes widespread, small businesses - traditionallly late adopters of technology - will need to aggresively use new technologies to create, build, and market their products and services.  Small businesses that fail to embrace technology will be under increasing competitive pressure from more technologically savy firms."

This is the research blog for this report series, and I am one of the report co-authors.  Please feel free to comment on the report or send us questions.

 

Discover on Small Business Independence, Flexibility

USA Today's small business blog has a post on a recent survey of small business owners sponsored by Discover Business Card.  The survey is part of Discover's monthly survey of small business confidence they call The Discover Small Business Watch.  The Watch focuses on small businesses with 5 or fewer employees.  According to their most recent survey:

"46% of owners started a small business to have more flexibility with their time or to be more independent. Only 19% cite making more money as the primary reason.

61% would still choose independence over working for someone else – even if offered more money than they currently make."

Our research shows that work/life balance, flexibility and independence are increasingly important to small business owners and potential small business owners - especially baby boomers, women and members of Generation Y (born 1982 to 2000).   For more on this trend see The Changing Face of Entrepreneurs.  We also have a related blog post - Entrepreneurs and Work/Life balance - that discusses data from an American Express survey. 

Sure Payroll on Small Business Salaries, Labor Shortage

SurePayroll is America's fifth largest payroll provider and their market focus is small business.  They produce a monthly report called "The Small Business Scorecard" on small business hiring and salaries.  The scorecard is based on payroll data they collect from 18,000 small businesses. 

According to their president's May scorecard review small business wages continue to rise and are driven, in his opinion, by a growing labor shortage.  Key quote:

"To be sure, the run-up in salaries is quite remarkable. We've seen twenty-one consecutive months of continued salary growth in the small business economy. We have not seen salaries this high since we started tracking the small business economy.

So why are salaries rising?

We view increasing salaries as a sure sign that there's a growing labor shortage issue in the country. Talented workers are getting tougher and tougher to find. To attract them, companies must pay more in salary and improve their benefits packages."

McKinsey on Software as a Service

The McKinsey Quarterly (registration required) has an article on software as a service.  In the software as service model, customers subscribe to software applications and access the software over the Internet from companies (often the developer) that host the application.  Gmail or Yahoo Mail are common examples, and there are software as service providers in many software categories. 

According to the article, almost every software category has either started to migrate or will migrate to software as a service over the next 3 years.  McKinsey says this migration is even more pronounced for small and medium sized firms than large corporations.

The State of the Local Online Advertising Market

Borrell Associates has released a report on local online advertising and they say it will grow 31.6% this year and reach $7.5 billion.  Key quote from the report's summary:

"We gauge this year.s U.S. local online advertising at $7.5 billion,growing at a clip of 31.6 percent over 2006. Newspapers continue to hold the dominant share. They control 35.9 percent of all locally spent online advertising, but pure-play internet companies (Google, Yahoo!, Monster et al.) are hot on their heels, with 33.2 percent. Yellow pages operators control 11.7 percent; Other Print (e.g., Homes & Land and other local magazines) 9.2 percent; TV stations 7.7 percent and radio stations 2.2 percent."

Small businesses need to be aware of this shifting local advertising landscape, and the growing role Internet companies are playing in local advertising.

Brandworks University and Niche Marketing

Brandworks University is an annual conference on brands and brand building that targets marketing and advertising executives from big corporations.  This year's conference was focused on niche marketing.  Key quote from conference website:

"...legacy brands and new start-ups are harnessing super-segmentation strategies, calling them the “new niche marketing” and with it, driving growth, higher margins and creating competitive barriers to entry. Companies of every size, in every category of business are doing this..."

Small businesses have always targeted niche markets.  It is interesting to see that big corporations are now increasingly focusing on niches.  For more on the conference, see coverage on the the Zeitgeist blog.

WiFi Proliferation and Mobile Computing

The market research firm Instat has released a new forecast report on WiFi chipset sales.  It is very bullish on the growth of WiFi with the key market segments being: (1) portable computing; (2) portable consumer electronics devices with Nintendo's DS and Sony's PSP (for those without kids, these are portable game machines) as examples; (3) WiFi enabled cell phones.

Instat says there will be 110 million WiFi equiped notebook PCs shipped in 2007, a 30+% growth rate over 2006.  They also expect WiFi equiped cellular phone sales to reach 27 million in 2007.  This is up from just 6 million in 2006, and Instat is predicting very rapid growth for WiFi enabled cell phones.

The platforms for mobile computing - powerful mobile computing devices and WiFi and cellular high speed wireless networks - are in place.  Prices are falling and networks speeds are improving.  Mobile location based services - navigation, mobile marketing, information retrieval  and even mobile dating applications - are becoming common.  People are increasingly seeing their cell phones and other mobile devices as their internet access method of choice. 

This shift from desktop access to mobile device access changes how people interact with the Internet.  It also requires businesses to rethink how they use the Internet to interact with customers, prospects and partners.