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Apr
24
More on Segmenting the Small Business Market
April 24, 2005 | Anita Campbell
Joe Wilcox, a Jupiter Research analyst, offers an interesting piece on his weblog about segmenting the small business market – it’s well worth reading. He says:
“In talking to vendors trying to sell goods or services to small businesses, I see two common tactical mistakes: Segmentation, if any, is by number of employees, or sales approaches are similar, if not the same, as [for] enterprises. Both approaches ignore the great diversity of SMBs and the marketing complexity reaching them. “
He also points out that one of the most overlooked segments are small businesses that have no employees, i.e., no payroll.
He says 70% of businesses have no payroll.
The SBA figures suggest that in 2001 there were 17 million small businesses with no payroll. That’s a large number, to be sure.
Keep in mind that these small no-payroll businesses operate as a hybrid between consumer and business.
Their business needs are very real. For instance, they will be very interested in features and benefits that are presented as business-oriented.
However, the way you reach them is not like reaching a traditional business. It is more like reaching a consumer. For instance, these no-payroll businesses frequently work out of their homes. The Internet is usually going to be a key channel to reach them.
I might add that word-of-mouth recommendations are another way that the no-payroll business makes purchase decisions. These microbusinesses simply ask someone they know whose opinions they respect.
