 It seems Facebook is ready to throw its hat into the ring of local business marketing as well. It’s being reported that the company is sending Facebook window decals and letters to local business owners as a first step to their future local advertising strategy. According to a recent survey conducted from small business social network MerchantCircle, 70% of small businesses now use Facebook to reach consumers. This represents a 20% increase over the previous year.Up from 50% a year ago and topping the 66% of small businesses that currently use Google search advertising…Facebook now ranks as the most popular marketing tool among local businesses.
Adoption doesn’t equal effectiveness, but 37% of local merchants are also struggling to manage their existing programs and don’t have time to take advantage of new, unproven services, with a lack of time and resources the top online marketing challenge for more than one third of merchants.
Time and cash-strapped business owners are gravitating towards simple, low-cost online marketing methods like Facebook. “Many merchants are working with very small budgets and almost no marketing resources,” said Darren Waddell, VP of marketing at MerchantCircle.
According to the report, more than half of local merchants are spending less than $2,500 a year on marketing, and the majority of 60% have no plans to raise their budgets this year.
Facebook also seems to have an advantage in the location check-in space, with 32% of small businesses saying they use the feature, compared with just 9% who have tried Foursquare, with an additional 12% of small businesses expressing their intentions to use Facebook Places in the coming months.
Twitter has also grown in popularity over the past year, with nearly 40% of local merchants using the microblogging platform to build awareness and community around their products and services.
Overall, less than 15% of merchants report doing any sort of mobile marketing or advertising, and more than half have no plans to do so in the coming months. Lack of understanding remains a huge barrier to adoption, as 74% of merchants report not having a good idea on how to reach consumers via mobile marketing.
Group buying will also take time to penetrate the local market, according to MerchantCircle, as only as 11% of local merchants have offered a “Daily Deal” using a service like Groupon, ChompOn, or LivingSocial, with an additional 20% planning to do so in the coming months. Results of group buying have also been mixed and may be hindering growth, as 50% of businesses that have run a daily deal campaign say they would not do so again.
The report notes that for the first time, Facebook is being used more than Google by local businesses for online marketing. The MerchantCircle survey is based on a random sample of 8,456 small business owners in the United States.
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