Small Business Advertising
We surveyed 296 small business owners across 20 industries to find out how they approach marketing their business.
The advertising landscape
In today’s competitive market, small businesses must navigate a complex landscape of advertising options to reach their target audience effectively.
Our study found that over two-thirds of small business owners believe marketing is crucial in achieving business goals, but how are small business owners marketing themselves?
The most common marketing goals for small businesses
How much money and time should small businesses spend on marketing?
A third (33.3%) of small business owners feel their level of success is proportional to the time and money spent on marketing. One in four (24.9%) business owners felt they achieved excellent results relative to their investment in marketing activities.
The median annual revenue percentage allocated to marketing among small businesses was 2%, with an average of 3.1%. Marketing is generally a low priority, as two in five small businesses (40.5%) dedicate only one hour per week to marketing activities. Over half of small business owners (53%) spend one or two hours per week, while over a quarter (26.7%) of survey participants reported spending no time on marketing.
The most common marketing methods for small businesses
Over seven in ten, (71.3%) small business owners reported that ‘word of mouth’ and ‘referrals’ were the most effective marketing approach. Social media marketing was the second most common, with 30.7% of owners using it. Additionally, about one in five small businesses use email marketing (20.9%), direct marketing (20.6%), and content marketing (20.3%) as part of their strategy.
Less popular methods included outdoor ads (7.8%), display ads on third-party websites (6.4%), event marketing (3.7%), radio advertising (2.7%), and TV advertising (2.4%)—likely due to the higher costs, which often exceed small business budgets.
The most effective marketing methods
We also asked the small business owners to rank what they believe to be the top three most effective marketing methods. This saw similar results with word of mouth, social media marketing and direct marketing coming in first second and third respectively.
The easiest marketing methods
We also saw similar rankings when it came to what small businesses believe are the easiest marketing and advertising methods to implement. Word of mouth and referrals (72.6%), email marketing (36.8%) and social media marketing (30.7%) ranked first, second and third respectively.
In contrast, radio advertising (4.7%), event marketing (2.4%) and TV advertising (1.4%) ranked as the hardest marketing methods to implement for small businesses.
Applying the most trending marketing methods seems to be what small business owners want to move towards. Some marketing methods are appealing to small business owners but are perceived as too challenging to learn or implement. Content marketing (35.1%), search engine optimisation (19.6%), and search engine advertising (16.9%) were cited as the top three most appealing but challenging methods.
The challenges of marketing your small business
When asked about the biggest marketing challenges, owners highlighted budget constraints (36.1%), time limitations (25.3%), and lack of experience or expertise (19.9%).
Who should do the marketing for small businesses?
Over half (52.7%) of small business owners took charge of their marketing responsibilities, whereas some (18.9%) owners engaged in any marketing activity. Those with experience commonly used content and paid social media advertising, while only 9.7% of inexperienced owners engaged in content marketing. 69.6% of those who did not do marketing had no prior marketing experience.
About 28.4% of small business owners manage their marketing with employees, outsourced agencies, or freelancers. Two-thirds of those with dedicated marketing support felt their business was successful relative to resources spent. Of owners who performed their marketing, only a third had prior experience. Most (59.4%) owners rate themselves at beginner/intermediate level, yet 54.7% of owners who performed all of their marketing activities felt their business was somewhat or very successful.
“Small businesses will continue to face challenges and difficulties when it comes to marketing to their target audience and staying competitive in the market. However, our study reveals that despite technological advances and increased use of social media, word of mouth remains the top marketing method that brings in new business and increases revenue.
“It also confirms that minimal effort, budget-friendly marketing methods that small business owners can perform themselves are preferable. Despite this, our advice for new small business owners is to consult a marketing professional where possible, as this will bring in more results and allow for more effective and purposeful marketing.”
– Brad Stevens, GM of Marketing at Reckon
ABOUT THE DATA
We surveyed 296 small business owners and users of our software across 20 industries to find out how they approach marketing for their business. We wanted to understand their marketing backgrounds, goals, how much of their resources and what methods they used to reach those goals.
The survey consisted of 15 questions in order to discover what business owners felt were the best, easiest and most difficult ways to market their product or service among 16 categories of marketing activities.
The survey was conducted in November, 2024. Some questions had the option to select multiple options and therefore the totals for some sections exceed 100%. Totals may also not sum due to rounding. When comparing between Industries, those that did not meet a minimum of 12 participants were excluded.
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Survey reveals the gap between male and female small business owners.
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Social media marketing for small businesses
Unexpectedly, over a quarter of small business owners indicated they did not use any social media platforms to advertise their business. Facebook (59.1%) was the most popular social media platform among small businesses, with almost double the second most popular platform – Instagram (31.1%).
Facebook was also noted as the most effective platform for advertising (44.6%), however, this was a much smaller proportion compared to the number of business owners that indicated they use Facebook for marketing (59.1%).
34.8% of respondents reported that none of the social media platforms were effective for their business—a proportion higher than the group of owners who don’t use any social media at all. This suggests that some business owners try various platforms but find that none deliver the desired results.