SMBs More Likely to Use Digital than Traditional Media

As of August 2009, small and medium-sized businesses (SMBs) in the US are more likely to advertise online than via traditional media.

Based on the "Local Commerce Monitor Wave XIII," from The Kelsey Group and ConStat, 77% of US SMBs used online for advertising in August 2009, compared with just 69% that used traditional media. This is the first time penetration of online advertising surpassed traditional. In an earlier survey from August 2008, 73% advertised online while 74% used traditional media.

"We have been tracking the trend of digital/online media replacing traditional media over four waves of the Local Commerce Monitor study," said Steve Marshall, director of research at The Kelsey Group. "The milestone of digital/online surpassing traditional media among SMBs is an indicator of the broad shift to online platforms."

Note, however, that spending does not necessarily track penetration. Though more SMBs used digital advertising, the majority of their budgets still went to traditional channels. In August 2009, The Kelsey Group found 36.8% of SMBs' advertising budgets went toward online. That was up more than 14 percentage points over the prior year.

Total annual ad spending among SMBs was down, from an average of $2,734 in August 2008 to $2,092 in August 2009. Spending on Websites and online profile pages, however, was up more than 26% to $769.