A new report shows 62 percent of small U.K. businesses are not investing in SEM, although 76 percent of those doing so report an increase in sales.
British businesses could be wasting an estimated £3 billion ($6 billion USD) on Web sites that cannot be found through search engines, according to research findings published last week. The report estimates 62 percent of small businesses in the U.K. are not investing in search marketing, even though 76 percent of those doing so report an increase in sales.
"It is absolutely vital that small businesses realize the importance of investing in search marketing," Peter Scargill, IT chairman for the Federation of Small Business told ClickZ News." Creating a Web site is absolutely pointless if no-one can find it."
The research, commissioned by Microsoft adCenter and conducted by Vanson Bourne, questioned 400 SMBs across the U.K. via online questionnaires. Of the respondents not using search marketing, 44 percent stated they thought it is too time consuming. More than 55 percent said it is too expensive, and 33 percent said it's too complicated.
However, the results suggest reluctance to invest in SEM is not due to a lack of knowledge; in fact, 78 percent of the businesses not doing search marketing claimed they were aware of the SEM tools available to them.
"SMBs are aware of search, but many seem reluctant to invest in it. Its importance simply cannot be underestimated, and SMBs that are embracing search are seeing the benefits" stated Scargill. "I can see why businesses see it as a big investment, but it's definitely a worthy one."
Search clearly isn't the only way to market a business online though. Listings on local sites or directories for example, can often provide cost effective methods for smaller companies to generate business.
Still, Scargill views search as a more solid investment. "I can see how directories such as Yell.com might be quite effective for some industries and businesses, but if you're looking for something, everyone I know goes straight to a search engine" he said, adding, "To me, it seems the most obvious place to market."
Another interesting stat unearthed by the research outlined a clear regional divide. SMBs from the North were the least likely to invest in search marketing; 75 percent neglected to do so despite 78 percent having an online presence. In Scotland and the South East, only 44 percent were not using search marketing. SMBs in the Midlands reported the highest ROI, with 85 percent saying they saw an immediate increase in sales after using SEM.
Interestingly, these results reflect findings unearthed by an Opus Research survey published last month. As reported by ClickZ, U.S. businesses expressed similar concerns as their U.K. counterparts. A quarter of respondents said online marketing is too expensive, 20 percent said it is too complex, and 15 percent cited a lack of staff to implement it.
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Jack Marshall was a staff writer and stats editor for ClickZ News from 2007 until August 2011.
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Gartner Magic Quadrant for Digital Commerce
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