SECOND ANNUAL Small & Medium Business Trends Report
SECOND ANNUAL
Small & Medium
Business Trends Report
Research insights from nearly 500 business owners and leaders
Introduction
Welcome to the second annual
¡°Small & Medium Business Trends Report.¡±
They report many challenges in finding, winning, and
3
SMBs Rise Above Growth Challenges
6
Growing Businesses Chart a Course to
keeping customers, especially as their businesses grow.
While tracking customer information is essential, many
Small and medium-sized businesses (SMBs) drive today¡¯s
still rely on email or spreadsheets. When we look at SMBs
innovation and economic growth. They have unique
in the category of ¡°growing businesses,¡± there are more
needs and challenges, which change and evolve as their
than a few common characteristics; they¡¯re more likely to
businesses grow. To better understand and address those
prioritize CRM in their budgets, to use helpdesk software,
challenges, Salesforce Research compiled the second
and to focus on providing consistent and personalized
annual ¡°Small & Medium Business Trends Report.¡± We look
customer experiences.
Find, Win, and Keep Customers
11
Conundrum
16
We also discovered that while many SMBs are automating
processes, on the whole they are spending too much time
In analyzing responses from nearly 500 SMB owners and
inputting data manually. Growing businesses are more
leaders,* we found some interesting differences between
likely to be using or investigating AI, and connecting the
growing businesses (defined as those with a revenue
apps that power their businesses.
To Connect the Customer Experience,
SMBs Explore Automation and AI
at what faster-growing companies are doing differently,
and uncover some of their secrets for success.
SMBs Face a Time-Tech-Training
20
Methodology
increase of 1% or more over the past two years) and their
stagnant/declining counterparts (defined as those with a
We hope you find this research useful as you endeavor to
revenue increase of less than 1% or a decline in revenue
grow your own business.
over the past two years). Comparisons are also made
between small businesses (defined as those with 2¨C49
Sincerely,
employees) and medium-sized businesses (defined as
Marie Rosecrans
those with 50¨C199 employees).
SVP, SMB Marketing
Our research shows that although SMBs rely on
technology to fuel their growth, it isn¡¯t always easy for
them to purchase, implement, or scale it. SMB leaders
want to grow smoothly, but they wear many hats and
don¡¯t always have the time to address long-term needs.
* SMBs represented in this survey include respondents with 2¨C199 employees. See ¡°Methodology¡± for more information on how this survey was conducted.
Salesforce Research
Small & Medium Business Trends Report / 2
01. SMBs Rise Above Growth Challenges
SMBs may aspire to grow into something
more. But as with many things for small
To what extent do you believe the following factors will pose a challenge to
your business¡¯ ability to grow over the next couple of years?
and medium-sized businesses, growth
is often easier said than done. Meeting
customer experience expectations,
Percentage of SMB owners and leaders who say the following factors are
critical, major, or moderate challenges
Small vs.
Medium*
Total
scaling technology, and establishing and
maintaining processes are areas of concern
for SMBs as they plan for growth.
Medium-sized businesses are
1.5x as likely as small
businesses to say
establishing/maintaining
processes (59% vs. 40%) is
a critical, major, or moderate
challenge to their business¡¯
ability to grow over the next
couple of years.*
59%
59%
Maintaining financial growth
48%
Hiring and retaining employees
74%
Meeting customer experience
expectations
43%
55%
42%
Scaling technology for growth
56%
40%
Establishing/maintaining processes
59%
Small businesses
no
difference
59%
1.5x
54%
1.3x
46%
1.3x
45%
1.5x
45%
as likely
as likely
as likely
as likely
Medium-sized businesses
* Difference between small and medium-sized
businesses was calculated using the following:
% medium / % small
Salesforce Research
Small & Medium Business Trends Report / 3
01. SMBs Rise Above Growth Challenges
Simplicity is important to SMBs as they
How important are the following factors when you¡¯re evaluating new technology for your company?
plan for the future. Beyond price, the
most important evaluation criteria for
new tech are ease of use, ease of setup,
Percentage of SMB owners and leaders who say the following factors are extremely, very, or somewhat important
and simplicity of maintenance. Nearly
three-quarters of SMB owners and leaders
Ease of use
95%
(74%) say that scalability is extremely,
very, or somewhat important when
Price
94%
they¡¯re evaluating new technology for
their company. More SMBs choose to
Ease of setup
93%
implement solutions that will meet
their long-term needs (58%) than
Simplicity of maintenance
92%
Speed
92%
to quickly meet their company¡¯s
immediate needs (33%).
Trustworthy vendor
62% of growing businesses
choose solutions to address
their long-term needs.
91%
Compatibility with existing
infrastructure or systems
87%
Mobile capabilities
76%
Scalability
74%
¡°Best in class¡¯¡¯ vendor
73%
Automation capabilities
Artificial intelligence capabilities
Salesforce Research
71%
51%
Small & Medium Business Trends Report / 4
01. SMBs Rise Above Growth Challenges
For many SMBs, investing more budget
into one area may mean taking budget
What are the top three tech budget priorities
for your company? Please select up to three responses.
away from another. When it comes to
prioritization of tech spend, the top of the
list includes productivity software, financial
software, security systems, and CRM
systems. Medium-sized businesses are 1.5x
as likely as small businesses to prioritize
CRM in their tech budget (42% vs. 27%).*
Productivity software
(e.g., Microsoft Office, Google apps)
36%
34%
Security systems
(e.g., firewall, intrusion detection)
34%
31%
Hardware
(e.g., servers, laptops)
29%
Internet hosting/internet service
provider (ISP)
24%
Point of sale/point of purchase
software
20%
Technology services
(e.g., consultants, partners)
18%
Mobility/mobile solutions
17%
Telecommunications/VoIP
Enterprise resource planning (ERP)
Other
* Difference between small and medium-sized
businesses was calculated using the following:
% medium / % small
** Difference between growing and stagnant/
declining SMB businesses was calculated using
the following:
% growing / % stagnant/declining
Salesforce Research
Not sure
1
2
3
39%
Productivity software
Financial software (e.g., accounting,
bookkeeping, bill payment)
Customer relationship management
(CRM) application or system
Among growing SMBs, the
top-reported technology
budget priority is CRM.
Growing SMBs (36%) are
2.2x as likely to prioritize
CRM than stagnant/declining
SMBs (16%).**
Top three tech budget priorities:
small businesses
13%
7%
3%
6%
35%
Financial software
34%
Security systems
Top three tech budget priorities:
medium-sized businesses
1
2
3
Customer relationship
management (CRM)
application or system
42%
32%
Security systems
32%
Technology services
Small & Medium Business Trends Report / 5
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