SMBs more confident of growth than large businesses

Friday 30 November 2012

Small and medium-sized businesses (SMBs) are increasingly confident about their prospects for growth, a survey has discovered.

The Chartered Institute of Marketing (CIM) Marketing Confidence Monitor indicated that SMBs are planning strong investment over the next 12 months.

They are also planning to increase their employee headcounts in the coming year.

By contrast, larger companies are setting cautious growth targets, reining in marketing budgets and expecting reductions in staff numbers, the CIM stated.

The institute's new quarterly study produced an overall confidence score of +4.12, on a scale of +/-100, indicating cautious optimism amid widespread uncertainty about the next 12 months.

Businesses were split equally between expressing reduced confidence compared with this time last year (30 per cent), similar confidence (30 per cent) and increased confidence (29 per cent).

SMBs planning to invest more

The study found marked differences between SMBs and larger companies - with almost a third of micro (31 per cent) and small (33 per cent) businesses anticipating an increase in marketing spend in the next year.

Some 40 per cent of mid-sized and 44 per cent of large companies expect a cut in budgets in 2013. A quarter of large companies are also expecting to reduce their marketing headcount in the next fiscal period.

SMBs were more confident than large companies that their business could meet its financial and growth targets, with, 45 per cent of micro and 38 per cent of small businesses more optimistic than in 2011.

Almost a third (29 per cent) of mid-sized and a quarter (25 per cent) of large companies expressed declining confidence.

Key role for business marketers

Anne Godfrey, chief executive of CIM, commented that marketing plays a "crucial role" in driving growth and performance, and marketers are uniquely positioned between the business and customer.

"They understand how consumer confidence and business sentiment interact, and our study shows that times are clearly still very tough," she stated.

“It’s encouraging to see that small businesses are pressing forward with marketing investment and jobs - critical for fuelling growth - but it’s worrying that so many large companies are still expressing such uncertainty."

Posted by Jenny Arthur