To Tweet or not to Tweet: Can Small Business Survive the Digital Era?

Imagine your day without the Internet. No checking for new friend requests, following celebrity fashion trends or scoping out the latest addition to your favorite music blog. For many, such a thing is unimaginable. Social media has taken the world by storm, and is an integral part of peoples’ lives, with only a few holdouts. That’s what I thought, but I was shocked to see how many companies refuse to include it in their business model.

In a study in June done by Hiscox, a UK small business insurance provider, 64 percent of small businesses polled said that social media is unimportant and not incorporated into their marketing plan. Compare that to 50 percent relying primarily on word of mouth, to the only 4 percent saying the same thing about social media.

Even with the majority of consumers plugged in to online networking some way, why are small businesses still reluctant to take that final step? It’s partially due to the fact many are unfamiliar with the technical aspects creating and maintaining a website. Moreover, with smaller companies they might not have the resources or manpower available to promote online marketing campaigns.

The real question is, can these small businesses afford to hold out? According to eMarketer,“$3.08 billion will be spent to advertise on social networking sites in 2011, a 55 percent increase over 2010.” Mostly driven by Facebook’s creation of more advertising space, the demand for new and exciting ways to reach the online community is growing. Twitter (News - Alert), LinkedIn and other sites are not far behind, and all are clamoring to wow consumers with their internet marketing savvy.

Competition with Fortune 500 companies and larger corporations is not the only concern for small business. Even if they somehow manage to have a profitable marketing strategy, they are still missing an enormous part of the U.S. consumer base. A survey conducted by Harris Interactive in December of 2010, the statistics showed people using social media for all aspects of their life, with positive results.

40 percent of  Americans say that they have received a good suggestion for something to try as a result of their use of social media

15 percent say they have made a connection regarding a job opportunity

9 percent say they have found a new apartment or house through their social media use

Considering the demand of the consumers, and the increased budget of large businesses, smaller companies may have no choice but to reach into their magic hat and pull out a few tricks. Because if they don’t, they may very well be stuck in the past while the rest of us move forward.