How will Digital Change Small Business in 2012

Over the course of 2011, we witnessed social media and location-based services really take off for small businesses — the mom and pop shops of the world continued to get more digital and more mobile.

As this year wraps up, we look back at the technological advancements that small businesses have benefited from and predict how those technologies will affect entrepreneurs in 2012.

We spoke with a number of small businesses to get their thoughts on how the market will continue to adapt to changing technologies as we move into the new year.

Based on those discussions, here are our seven small business predictions for 2012. Read on and let us know what you’d add to the list in the comments below.

1. Businesses Mine Big Data

Many of the small business owners we spoke with pinpointed 2012 as the year of big data. “Companies are realizing that they have a lot of information on their hands and will need tools to mine it, make sense of it and monetize it,” says We Are Cloud CEO Rachel Delacour.

“What will really matter for SMBs in 2012 is the fact they can, for the first time, mine their own business like the big guys, and do so quickly and cheaply,” Delacour syas. “SMBs can use powerful, high-end tools delivered via their desktop browser or onto their tablet for just a few dollars per month to see what’s happening with their HR, their sales, their social media engagement. Those SaaS tools give a one-man shop or a 50-person outfit almost instantly the same firepower as a whole department with its own IT staff inside a multinational.”

Jeff Judge, CEO of Signal, agrees. “According to IBM, 2.5 quintillion bytes of data are created daily, and 90% of the data in the world today was created within the past two years. 2012 is the year when small businesses start to bring together data from their website, customer purchase behavior, digital marketing campaigns and social media activity around their brand to drastically impact the quality of their digital marketing efforts.”

2. Websites Optimize for Tablet Commerce

Forrester Research predicts mobile commerce will grow at a compound annual growth rate of 39% through 2016, and Infinite Research forecasts that tablet adoption will grow at a compound annual growth rate of 56% per year through 2015.

Alex Schmelkin, co-founder and president of Alexander Interactive, believes that 2012 will bring an explosion of tablet commerce. “Widespread adoption of Apple’s iPad has made it imperative for retailers to optimize their websites for tablet usage,” he says. “While companies will continue to develop native apps for the device, web browsing is the number one activity, and most t–commerce will continue to occur in the browser. Small businesses should review their sites to optimize for touch and fix any usability issues.”

Lisa A. Shorr, vice president of marketing at PC Troubleshooters, would go as far as to say that 2012 is the year that tablets take a stand in the small business arena. She explains, “Since its launch in 2010, the tablet has been used not only as a browsing mechanism, but a true mobile business tool as well…Our clients are demanding more mobility and integration of mobile devices for document sharing, emailing, social media and more.”

3. Brands Become Publishers

“Content is King.” That’s an Internet mantra we’ve all heard way too many times, but there’s truth to it — and next year, small businesses will start to see the light.

“2012 will mark a surge in businesses not only being the publishers of their own content, but [being] disseminators as well,” says Affect Strategies‘ president and founder Sandra Fathi. “Whether it’s a company blog or a corporate e-newsletter, small businesses will focus on creating the content and developing their own publishing vehicles to get their messages to market. They will bypass traditional media outlets and go directly to their target audiences by creating branded niche media properties.”

4. Loyalty Programs Go Digital

Who doesn’t love free stuff? Small businesses have been accommodating that love for decades — each year, loyalty programs just keep getting better and easier to use.

In 2011, Foursquare and other location-based services were huge inflencers in taking loyalty programs digital. Small business certainly played their part in the game, making check-ins all the more fun for consumers.

Next year, though, we’ll see greater adoption of digital loyalty programs. “Punchcards are a thing of the past,” says Doug Hardman, CEO of SparkBase. “Businesses will start transferring their loyalty reward programs into the digital space. This is a twofold trend to keep up with bigger businesses such as Starbucks and Subway, who have digital reward programs, and also to compete with daily deal sites. Small businesses want to differentiate themselves and offer special deals without having to work with Groupon or LivingSocial. Mobile digital loyalty programs allow them to do this.”

“The shift to mobile shopping is accelerating as nearly half of all shoppers use their mobile phone to scout deals and compare prices,” says Hardman. “Mobile coupon redemption is forecasted to exceed $43 billion globally by 2016, and merchants need a way to connect with shoppers [on their mobile devices].”

CEO Jeff Judge of Signal agrees. He says, “The next wave of loyalty programs for small businesses will leverage customer databases of purchase history, marketing campaign response rates and social media activity like check-ins and brand mentions to customize rewards to an individual. One only needs to look at companies like Bellyflop, Stampt and SpotOn — and Google’s acquisition of Punchd — to see this emerging already.”

5. Websites Integrate Social Login

Ian Aronovich, CEO of, believes that more small businesses will integrate social login on their websites in 2011. “Social login is where you can use your Facebook, Yahoo and Google IDs [among others] to login to various websites,” he says. “It’s quick and easy to use. Social login is great because people don’t need to create dozens of new usernames and passwords every time they find a site that they want to use.”

Because Facebook is the most popular social network and Internet users’ top choice for social login, small businesses may want to focus initial efforts on the platform. “A study by Social Labs shows that 50% of ecommerce visitors are logged in to Facebook simultaneously,” says marketing manager Alanna Francis of Blue Fountain Media. “This means that with Facebook Open Graph integration, small businesses can show customers recommendations and Likes from their social circles. Since many retailers have shown that social reinforcement increases sales, small businesses will want to consider this strategy in 2012.”

6. Businesses Pull Back on Daily Deal Spend

Daily deal sites like Groupon and LivingSocial brought lots of excitement in 2011. While we saw a lot of small businesses success stories in the group buying space, we also heard of a number of disasters, including the story of a baker who almost went out of business after running a Groupon deal. For small businesses running on low margins, daily deals aren’t worth it.

“The daily deals tallies on customer retention and profitability continue to be ugly for merchants,” says Tarek Pertew, co-founder of Parrut. A recent Rice University study suggests that nearly half of all merchants are making money on deals. And with Groupon’s own data suggesting that only 22% of customers are coming back, we [at Parrut] assume that a significant pullback is due. That said, the daily deal business is evolving, and it’ll certainly be a major outlet for lead gen spend going forward. At the same time, we think small businesses used daily deals as a ‘gateway’ to social marketing, but will now focus on their own content and other technologies which give them more control over sustainable growth and profit.”

7. Scheduling Continues to Go Cloud

Jerry Nettuno, founder and CEO of Schedulicity, may be a little biased, but we like where his head’s at. “The appointment book is dead,” he says. “The business sector as a whole has seen a shift to automation. The success of sites like Schedulicity, OpenTable and ZocDoc only reinforce the idea that the traditional pen and paper appointment book may see its demise in 2012. The number of online appointments is growing exponentially, as Schedulicity alone has seen nearly 7 million appointments booked online since mid-2009. Over the next two to five years, the physical appointment book will be gone altogether and replaced with online counterparts.”

In 2010, Seattle-based Emerson Salon, sourced 75% of its business from Twitter, Facebook and its blog, greatly due to its online booking options and social media savvy. Other small businesses should take note and move towards digital scheduling in 2012.

Enter Your Mail Address


Related Posts: