Small marketing spend dilutes value of SME websites

Many New Zealand SMEs rely on word of mouth to deliver new business and spend modestly on digital marketing, according to new research released from Dot Kiwi. 

While only half of SMEs have a website (56 percent) and most use email to communicate to their regular customers (81 percent), even fewer use common marketing tools such as search engine optimisation (SEO) and digital advertising, which are being used by larger companies such as banks, retailers and utilities to their advantage. 

The research carried out by Dot Kiwi, the Internet domain name provider, found that 50 percent of SMEs spend less than $1,000 annually on marketing, relying on existing networks and word of mouth to deliver new business enquiries. As a result, there is a direct correlation between their web traffic and their marketing spend, with low spend correlating with low visitor numbers.

A third of SMEs with a website say they receive less than 50 visitors each week, whereas 25 percent had no idea about their web traffic numbers.

Angus Richardson, Managing Director of Dot Kiwi, said SMEs should be tracking their website visitors, at the very least, so they can track the effectiveness of their sales and marketing efforts. Beyond that, for a relatively low investment, website owners should optimise their existing digital assets by applying some automation to their marketing to make it quicker to communicate with customers. 

“Many business owners don’t appreciate the value of a website visitor. Once a visitor is at your website, you have the chance of converting them to a customer either through e-commerce, an online newsletter, or a social media connection. Sixty percent of New Zealand SMEs can’t take payment on their website, but that doesn’t mean they can’t convert someone into a newsletter subscriber.” 

35 percent of SMEs say they receive most of their enquiries from their website, but there is potential to do more.

“Using search engines such as Google and Bing has become routine for New Zealanders when looking for a business, product or service. It might come as a surprise though, that only 77 percent of SME respondents said they use them when searching for businesses online. Eighteen percent search the Internet by typing in web addresses, while four percent use a directory service.”  

Despite the importance of search, only 27 percent of SMEs optimise their website using SEO, and 22 percent use paid search engine advertising. That is set to increase, as 15 percent of SMEs will look to engage SEO and 16 percent paid search engine advertising. 

“SMEs are waking up to the prospects search engine marketing provides, but most are ignoring the benefits of a domain name strategy. Only ten percent of SMEs have multiple domain names despite the volume of business searches being conducted through “type-in” traffic.

“SEO and paid search engine advertising are obvious, most prospective customers search for businesses that way, so make yourself visible in their results. Beyond that, owning a bundle of domain names captures that 18 percent who search by web address, while helping to avoid having your brand abused in phishing scams,” says Richardson.

Photo: Angus Richardson.