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Where Small Businesses Spend Their Advertising Budgets


Small Business Advertising in 2013

Valpak, a branch of one of the largest digital media marketing companies, created an information infographic to illustrate how advertising budgets of small businesses are being used in 2013. They surveyed more than 700 individuals nation-wide across a large variety of business fields. Here are some of the highlights of the survey results.

Decision Making

In small businesses in America, about 42% of advertising decisions are made by one person alone while 58% of businesses have more than one person making these decisions. Email communication is the most popular among advertises, with 74% of them preferring that method. Also, the more personal the communication to the advertiser, the less communication they actually required.

Most of the businesses surveyed reported over $1 million in income, however the advertising budgets remained low at less than $50,000. The highest quarter for advertising spending was the second quarter, April-June, when advertisers spent 31% of their budgets. The fourth quarter was the lowest for advertising spending, with only 20% of budgets being spent October through December.

2012 Budgets vs. 2013 Budgets

Surprisingly, digital budgets decreased from 2012 to 2013. Direct mail and telephone book spending also decreased from 2012 to 2013. Increases in budgets were seen in radio, door hangers, billboards and television spending.

The study also compared the budgets of two different types of businesses. The first is called “high ticket, low frequency (HTLF),” meaning they do large-scale invoicing but not as often. A good example would be a construction company that does large projects that net in the millions but take months to complete. The other type surveyed was “low ticket, high frequency (LTHF)” which does smaller invoices at higher frequency, such as a coffee shop. Notable differences were that the HTLF companies decreased their budget for event marketing in 2013, and dropped the telephone book budget significantly. LTHF businesses decreased budgeting for telephone books and digital marketing significantly.

When it comes to digital marketing, budgets in email marketing have decreased from 2011 to 2012. Budget dollars spent on webpages and websites have increased from 2011 to 2012. There was a 14% increase in social media marketing dollars spent from 2010 to 2011, but only a 6% increase from 2011 to 2012. Social networking was one area that saw an increase in budget year after year.

The majority of businesses, regardless of whether they were HTLF or LTHF, used an internal analysis of the past advertising media used as a source to determine the following years’ budget.

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