It’s a big year for small businesses. There’s a new president, a new administration with new policies and all the while, the increasingly digital world is becoming more complex and competitive. Even with all the changes, nearly half of the 1,100 small businesses surveyed in Wasp Barcode Technologies’ recently released annual State of Small Business Report say that they expect a positive impact on their business with a Trump administration. This is an increase from the 39 percent that believed the same thing around this time last year, when asked what kind of impact a new president would have on business.
The report also revealed that 50 percent of those surveyed don’t think the government is currently doing enough to support small businesses, and 13 percent don’t want the government involved at all.
Still, the mood seems positive, as 69 percent of small business owners and executives anticipate revenue growth this year, whereas 10 percent anticipate a decline and 15 percent predict no revenue change compared to the previous year.
Below are the seven strategies business owners plan to adopt to achieve growth in 2017:
- Improve existing customer experience and retention
Forty percent of those surveyed say they will grow their business by improving existing customer experience and retention. This makes a lot of sense, as keeping the right customers and retaining them is much cheaper than acquiring new ones. In fact, a number of research finds acquiring a new customer costs anywhere between five to 25 times more than keeping existing customers happy.
Additionally, increasing customer retention rates by just 5 percent can increase profits by 25 to 95 percent, according to research done by Frederick Reichheld of Bain & Company (the inventor of the net promoter score). Still, most companies still spend more resources and put more effort into acquiring new customers rather than finding ways to retain existing customers.
What is your customer churn rate?
One way to keep existing customers happy is to keep communication lines open through a useful website. For instance, use blogs to engage with your customers. Wasp’s report finds that only 24 percent of those surveyed plan to offer a company blog on their website, compared to the 28 percent who planned to do the same the previous year. Another great engagement tool is allowing visitors to your website to watch videos, whether about your product or even better, videos that give a glimpse into the inner-workings of your company. Today’s consumers want to know that they are supporting a brand they believe in, and employer branding is a great thing to showcase through videos.
- Launch new products and services
Wasp’s report finds that 36 percent of those surveyed plan to diversify their business in 2017 by launching new products and services in hopes of growing revenue. Fortunately, 42 percent say they will be using social media to promote specific products and services.
The introduction of social media has completely changed the way businesses communicate with their customers, and even consumer behavior and expectations have changed. Customers today no longer trust traditional advertising methods, because they know it’s paid for and there is no way to have a two-way relationship with a traditional medium. On the other hand, social media is all about engaging and communicating with consumers. Brands can interact and get feedback from customers this way, an especially great tool when launching new products and services.
More than half (54 percent) of those surveyed in Wasp’s report say they will invest more than 4 percent of their revenue in marketing, with the top tool used being a website, followed by emails (likely newsletters), then social media and word of mouth or referrals. Does your business have a referral or loyalty program? Do customers feel like they are getting something out of being a loyal customer, and can they feel good about referring your products and services to others because you have a good employer brand?
- Invest in new customer acquisition and activities and methods
Small business owners understand that retaining customers is important, but so is attracting new ones. In fact, 32 percent say they will invest in new customer acquisition in 2017, and 33 percent will do so by gaining likes and fans. Again, social media is great way to establish direct communication and build relationships with potential customers. A whopping 68 percent of those surveyed say they use Facebook as a marketing strategy, much more so than LinkedIn (39 percent), Twitter (34 percent) and Instagram (27 percent). Using these social media platforms is also a good way for keeping track of the way you communicate with the public. For instance, if you see a drop in your followers, you can examine the way you’re communicating on social media. And remember, always use social media to listen to what potential customers are saying. When they see that your brand is a customer-first kind of business, they will be inclined to learn more about you, and spread the good word for you.
- Expand into new markets
Our world is becoming increasingly global and interconnected, so businesses that may not have had to care about what’s going on on the other side of world, now do. Wasp’s report found that 30 percent of the small business owners and executives surveyed plan to expand into new markets in the new year. With this, comes more complex inventory and management systems and way of doing business. Yet, only 18 percent of small businesses use an inventory control software and system. Sure, that’s an increase from the 16 percent that had a system in 2016, but the number is still too low. The last thing you want, as a business, is to lose customers and damage your reputation by not having the goods you promised, or having too much or forgotten inventory sitting on your shelves, destroying your balance sheet in the process.
- Hiring new employees
Bringing new talent in is certainly a great strategy for growth, but it also happens to be a top challenge for small businesses (50 percent agree hiring new employees is what’s keeping them up late at night). Still, 52 percent of small businesses plan to hire new talent to achieve growth in the new year. We know hiring the right talent is crucial for business success, so what’s the best way to source and find great new talent while also keeping overhead costs low? By involving existing employees. Do you have an employee referral program at your company? The impact of a successful employee referral program can be very beneficial to your bottom line, and studies show that referred hires tend to stay at jobs much longer than those who joined with no connections to the company.
Additionally, Wasp’s report found that only 24 percent of small businesses do not involve their employees in marketing efforts at all, which is a huge loss to the companies. It takes an entire company to find great hires, so why not empower your employees to do so. Ask them to share content on their social media sites and engage with potential candidates, which only happens at 30 percent of the small businesses from Wasp’s report.
- Invest in training or tools to improve employee productivity
Our increasingly connected, 24/7 world means companies that work smarter end up on top. Wasp’s report found that 21 percent of the small businesses surveyed say they will invest in new training tools to improve employee productivity in the new year, and 42 percent plan to increase IT spending. Looking back at 2016, the top IT changes were replacing computer hardware, updating networking security and upgrading network. This is all great, but adding a cloud computing software was number six and implementing an inventory management system was scarily number nine on the list from last year–and both of these IT systems are crucial for business success.
- Open new stores / sites / facilities
Out of the 1,100 small business owners surveyed, 6 percent say that they plan to open new stores, sites and facilities. There are lots of ways to do this successfully and get the word out there to the right customers, but just remember to involve the entire company and use marketing and IT solutions to your advantage. It’s all about working smarter, not harder.Business & Finance Articles on Business 2 Community