Many years ago, my husband and I took a trip to Vegas for our anniversary and to escape our young kids for a while. That might not seem out of the ordinary for most couples.
But for statistical analysts like me, choosing to go somewhere where the main source of entertainment is gambling is actually a bit of an outlier. (Ha! That’s a statistics joke)
One afternoon while we ate lunch, we had the option of playing Keno. This is like the lottery, where you pick a set of numbers and then see if they get selected as the winning numbers. I calculated the odds of winning and the payout if you win, and determined that playing was a losing prospect. The odds were always in the favor of the casino. So why bother?
Instead of gambling we focused on delicious food and amazing entertainment. We left the gambling to those either bad at math or looking for a way to kill time and money.
Gambling in Small Business
I was thinking of this experience recently as I read over some statistics on online marketing outreach. What are the odds that your business will get found online? Well, let me tell you, the odds are not in your favor.
The game is rigged. It’s even worse than the gambling odds.
For example, did you know that nearly two-thirds of Google searches never leave the search page? Google provides the answer and there is no need to click on either organic or paid search results.
In addition, Google controls more than 95% of all search advertising and over half of the display ads. And if you do pay for a display ad, expect to see a less than 1 percent click-through-rate on your ad.
You might say, but I know that people click on my ads and ultimately buy from me. Well, then let me point you to a Journal of Marketing Research study that found that about “88% of folks who see retargeted ads would have bought anyway.” So did you add any customers that weren’t already planning to buy from you? How can you ever know that unless you drop all your online advertising and see what happens?
The House Wins
The winners in the world of online marketing are not small businesses.
The number one winner is Google, with Facebook and Amazon close seconds. As Rand Fishkin, founder of SEO software company Moz and SparkToro said in his SparkToro blog, “Facebook and Google ads are incentivized to minimize your return, and maximize the percent of margin they get.”
Now it’s hard to blame a company for wanting to increase their margin, but it’s at the expense of small business owners. And if you dig a little further into what’s going on with Google, it only gets worse.
A recent research study showed that Google rewrote almost two-thirds of all page title tags even though these are often carefully selected by a business. And a January Wall Street Journal article shared information from a lawsuit alleging that “Google misled publishers and advertisers for years about the pricing and processes of its ad auctions, creating secret programs that deflated sales for some companies while increasing prices for buyers.”
And then there are all the stories about Google’s questionable ethics, anti-trust issues in the U.S, the E.U. and U.K. and with some competing price comparison websites. And that’s all just in the last two months!
It’s not just Google
There are also plenty of issues related to the other top revenue producing online advertisers. For example, a recent study showed that Facebook’s interest targeting is inaccurate almost one-third of the time. Consider what that means for small businesses targeting specific individuals on Facebook based on their profile.
Then let’s consider Amazon, who posted $31.2 billion in 2021 revenue for selling ads. According to the experts, “if you don’t advertise on Amazon, you can have the best product at the best price and no one will buy it because it’ll sit in a stack of thousands of products that match that search term.” Again, small businesses are competing against Amazon’s own ads promoting their own products.
Even Linked In has its issues. A recent study found that there are computer-generated fake profiles on Linked In being used to connect with potential customers through Messages to generate sales for large businesses. So again, when small businesses make legitimate attempts to connect with prospective customers, the outreach can fall short because of issues like this.
As these Big Tech companies continue to dominate the online advertising world, it makes all of us small business owners start to wonder how we can ever be found by our customers online.
Do we really need digital marketing?
Whether it’s recruiting new employees or connecting with prospective customers, small businesses depend on their online presence. The complete shutdown of in-person events like trade shows, conferences, and networking events pushed B2B companies to ramp up their online presence rapidly.
According to Statista, small businesses spend on average $6400 a year on digital advertising fees. The U.S. SBA recommends spending 7-8% of gross revenue on marketing in general, with about half of that spent on digital marketing.
Why do we spend all that money on digital marketing? Because when someone is looking to buy something, they typically start with an online search, so we need to be online when they’re looking. And right now, nearly three-quarters of B2B buyers are millennials. They prefer to get pretty far along in the purchase process before actually reaching out to a salesperson.
That means that they are not actually sales leads; they are self-qualifying themselves with their online search as prospects. So your business had better be online when those prospects start searching for a solution to their problem.
Which means that even though all the research shows that it can be very difficult to GET found online, it’s more of a gamble to skip the online marketing than not.
Play a Different Game
And now we’re back to where we started. The game is rigged.
However, if you don’t play the game, you won’t win at all.
It’s a frustrating situation made even more complex by the fact that it can take months or even years to generate the kind of online presence that has you showing up consistently when your customers begin an online search.
What’s a small B2B business owner to do? I covered some of this in a past blog post on death and taxes and digital marketing.
Mainly it comes down to being a bit more careful and strategic with where and how you position yourself online. In addition, it helps to be much more specific about exactly who your customers are, so you can show up where they’re looking for information.
If this post, or your own experience, has led you to be skeptical about your online marketing as well, then follow me further down the rabbit hole in my free class “Digital Marketing for Skeptics”. There are some steps we can all take to stand out to the right people in the right places. It just takes a clear, well-researched strategy.
And maybe a little good luck as well!
Want More Information?
The Digital Marketing for Skeptics class is geared toward small B2B business owners who want to learn more about how to navigate the world of online marketing and find different ways to be stand out and be found. Take five minutes a day to read or listen to each lesson and five minutes a day to take one action = 10 minutes a day x 7 lessons = 70 minutes in 7 days.
And a big h/t to Rand Fishkin for his extensive research on digital marketing for small business in his SparkToro blog posts.