What SMBs Crave Most: Respect
Small companies are often treated as “small fry” by their large enterprise cousins. This is a missed opportunity that has major significance for the U.S. economy.
Small- and medium-sized businesses (SMBs) play a big role in the U.S. economy, creating millions of jobs each year. But according to Gallup^1 the United States ranks not first – not even second or third – but twelfth among developed nations in business startup activity. Even Italy, floundering in recession and government scandals, has a higher startup rate than the U.S.
For the first time in 35 years, American business deaths now outnumber business births. We are lagging in starting new firms per capita, which translates into a big drop in job creation – and that’s a serious problem for the whole economy.
Small Businesses, Big Needs: One reason SMBs are struggling is that they aren’t being effectively serviced by Big Business. To many Fortune 500 behemoths, these companies are small fry, and more often than not, they don’t seem important enough to be pursued as customers, or lucrative enough to have products tailored to their needs. So SMBs are fending for themselves, meaning Big Business – and the U.S. economy – is losing out on an important customer base and revenue stream.
As technology plays an increasingly vital role in operations and growth, this misalignment is often true in marketing technology products and service to small businesses. Our research points to three areas that most clearly illustrate this missed opportunity: service, communication, and offerings.
Hello? Anyone There? Just like their Fortune 500 counterparts, time is money for SMB decision-makers. Customer service and IT support are particularly sensitive pain points.
Small business owners and managers often have many hats to wear, without the luxury of dedicated roles that scale provides. Without internal IT staff to handle problems, they are usually on the hook to fend for themselves using outside support, which often leads to little or no help at all.
A common theme in many of Greenberg’s SMB focus groups is how badly SMB decision-makers have been burned when talking to overseas support staff, navigating the “voice tree,” having to answer multiple questions, etc. In a recent focus group, one SMB owner who has to regularly call IT support said, “They pass me around and don’t get back to me, and that’s another hour taken away from running my business that I won’t get back.”
Just like Big Business, SMBs want their IT support to be executed seamlessly and perfectly. They want a person who listens to their needs and either resolves their issue quickly, or hands it over to someone who can. SMBs may struggle more to get help, but they want the same results Big Business gets – and they want them quickly, seamlessly, and painlessly.
If they can’t get expeditious, effective support, the fallout from a poor experience can be far-reaching, as they share their interactions with others. Long memories can turn such experiences into brand barriers for large enterprises that serve them.
Talk to Me with R-E-S-P-E-C-T: Another pain point for small businesses is how large enterprises communicate with them. SMBs are passionate about being treated as business decision-makers, with pursuant expectations around receiving relevant messaging about issues like growing their client base, managing costs, and getting a competitive advantage. In a recent focus group, one SMB owner said to his larger technology suppliers: “Speak to me as a small business owner, not as a consumer or someone from an enterprise business. Understand my specific needs, and the specific challenges I face.”
The flip side is that SMB decision-makers often consult consumer-oriented sources of information, and then buy from consumer-facing retail outlets. So when considering technology purchases for their businesses, they’re more likely to read Consumer Reports, compare prices on Amazon, and then drive to Best Buy for the final purchase. In this sense, they do behave like individual consumers.
There is an opportunity here for large enterprises to turn that behavior around by treating SMBs as a unique class of business, and then gearing up accordingly. We have seen multiple clients retool their organizations – such as with segment-sensitive call centers – once they understood this important SMB dilemma.
Hold the Mayo (But Do Include the Fork, Plate, and Table): Another myth that haunts the large enterprise view of SMBs is the notion that “because they’re small, they want it cheap” – but while SMBs spend less on IT than their enterprise cousins, that doesn’t mean they have a preference for “economy”-priced products.
On the contrary, their needs are perhaps even more robust, wide-sweeping, and multi-dimensional than their large enterprise cohorts, due to the myriad responsibilities they face. SMBs require devices and solutions that meet a broader range of needs, both at the mundane levels and more demanding ones. “If you’re going to sell me an office full of hardware, make sure it’s pre-packaged to cover all my needs, not just accounting or fulfillment. It makes no sense to order a meal, but not have the plate or cutlery to eat it with,” said one SMB decision-maker in a recent session. They know that products or services not meeting their needs will quickly exposed them as inadequate.
Big technology companies can play a big role in the growth of SMBs. By catering to their needs in a more focused, tailored manner, they can be more efficient, productive, and profitable. The bigger picture is important, too. Encouraging large enterprises to champion SMBs is ultimately about the broader beneficial effects on the economy as a whole.
^1 www.gallup.com Business Journal, "American Entrepreneurship: Dead or Alive?" January 15, 2015.
SMBs are not seen as lucrative enough to have products tailored or customized for their needs