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Social Media is Key to Small Business Advertising

By: Lending Tree



For small businesses, advertising generally isn’t optional — it can be vital for turning a fledgling independent business into an established, successful one. But as new advertising options emerge, it can be difficult to know which investments make sense, especially for newer businesses with more limited budgets.

new survey from Visual Objects — a portfolio website that showcases work from creative firms — looks at how small businesses are approaching advertising in 2022. The key takeaway: 70% of small businesses are investing in social media advertising this year.

Here’s what else is in store for the world of small businesses advertising.

Social media is a top advertising priority

In 2021, more than a quarter of small businesses (26%) used between 10% and 30% of their advertising budgets to showcase on social media.

For context, the minimum spend for social media ads ranges from $1 to $20 a day, depending on the platform (the survey cites information from social media manager Hootsuite). For businesses that advertise year-round, that could cost between $365 and $7,300 annually — for one platform alone. As such, the potential impact can depend heavily on the platform itself, as well as a company’s goal and core audience.

And this trend doesn’t seem to be going away, at least not any time soon — 54% of small businesses say they plan on spending more on social media in 2022. By contrast, just 30% of small businesses have investment  plans for print advertising.

Interestingly, although only 38% of small businesses feel Facebook is their most effective social media advertising tool, the platform is the top social media channel for small business advertising (cited by 70% of respondents).

Other popular options include:

  • YouTube (54%)
  • Instagram (52%)
  • Twitter (42%)
  • TikTok (31%)

Part of the appeal of social media platforms is that they can help foster a relationship with existing and future customers beyond traditional ads. For instance, businesses can directly reply to other accounts through comments and — in the right circumstances — create user-generated content to further their interests.

Still, circumstances sometimes make it difficult for small businesses to fully capitalize on these advertising options.

COVID-19 budgetary constraints on advertising

More than a quarter of small businesses spent less than $10,000 on advertising in 2021, and it seems the pandemic may be part of the blame. In fact, 36% of small businesses say they’ve been moderately impacted by COVID-19 and its aftermath. Plus, the survey further revealed that annual advertising spending had decreased for 25% of small businesses in 2021.

Without more investment in advertising to help stir up business, that could translate to those businesses falling behind in future quarters. For example, those who skimped on ads in 2021 may not have been able to capitalize on Small Business Saturday, the post-Thanksgiving event that encourages holiday purchases at local businesses — a day on which almost half of Americans planned to shop.

Another interesting point found here: While almost half of small businesses plan to spend more on social media ads going forward, 36% of businesses with more than 250 employees plan to further decrease their investment in print advertising. This could provide smaller enterprises even more opportunities to grow — but just how much value it can provide still remains to be seen.

Methodology: In December 2021, Visual Objects surveyed 1,003 small business owners and managers at U.S. companies, all of which had fewer than 500 employees.

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It may not have been reviewed, commissioned or otherwise endorsed by any of our network partners.

Published: April 26, 2022

Source: Lending Tree

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Lending Tree

LendingTree is an online loan marketplace for various financial borrowing needs including auto loans, small business loans, personal loans, credit cards, and more. We also offer comparison shopping services for autos and educational programs. Together, these services serve as an ally for consumers who are looking to comparison shop among multiple businesses and professionals who will compete for their business.

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