Video = Fastest Growing Website Feature for Small Businesses small businesses e1269542467463 200x130 Indeed, small businesses have been racing to get their websites video-capable over the past year - and those same small businesses are spending more on paid search advertising.  According to a new report, small business advertisers spent more than twice as much on paid search and nearly 4 times as many of them reported having video on their website vs. a year ago.

Local online advertising firm WebVisible just released the second installment of their study, "State of Small Business Online Advertising," which examines trends among their nearly 12000 small business advertisers and represents around $22M in Q4 2009 U.S. small business advertiser spending.

While there are a lot of nuggets of data about where SMBs are headed with online advertising, I thought I would take some time to highlight the aspects of the data that most apply to our readers: video, search, and conversion.

Video Continues to be Both the Present and the Future

In fact, "video capability" was the single fastest growing feature that small businesses added to their website.  In the same quarter of the previous year, only 5% of small business websites had video.  In Q4 of 2009, that number climbed to 19%--four times as many.  That's rapid growth for just one year.

Video = Fastest Growing Website Feature for Small Businesses smbs website video

I expect this number to jump significantly again in the coming year.  At ReelSEO, we've been banging the gong on small businesses embracing video for a long time.  It's one of the best ways to engage your audience, and is rapidly becoming one of the best ways to position your company in front of those that are seeking out your product or service via search.

Speaking of Search Engines…

There are many findings in the report that might pique your interest.  For example, small businesses seem to be leading the charge on embracing Google's competitors (Bing, Ask, and Yahoo) for advertising purposes.  The click through rates from 2008 to 2009 may point to one reason why these companies are moving some spend to Bing and Yahoo.  In 2009, the click through rates for Google improved over 2008 by about 32%.  However, for Yahoo, the jump was 123% and Bing went up 109%.  Google still trounces them both on cost-per-click, which can matter greatly assuming similar conversions.

Video = Fastest Growing Website Feature for Small Businesses ctr search smbs 600x357

Overall, spending by small businesses on search advertising rose to an average of $2,149—that's an increase of 111% over Q4 2008 and a jump of 30% over Q3 2009.  No one should be surprised by these numbers, and you can certainly expect to see them climbing again in the next WebVisible report.

Here's a quote from Kirsten Mangers, the CEO of WebVisible, that is both a statement of the obvious and the most important thing that you (as well as webvisible customers, partners, etc..) can glean from this article:

"These numbers show increased confidence by small businesses in using search to gain leads – and increased ability to turn those leads into sales.”

Conversion Rates are Rising?

Any form of advertising that captures the imagination of cost-conscious local merchants has to be effective.  And by that measure, online video is hot.  It would be tough for the small business to stay in online advertising if they couldn't see conversions going up as a result.  Small companies rarely have the luxury of throwing money at campaigns for brand awareness.

ALSO ►  ATTN B2B Marketers: How's Video Working for You? [Survey]

Which is why these increases in spending are exciting—it shows that online advertising is working for many small businesses.  In my experience, these small business owners rarely make marketing decisions based on gut feelings.  Even when they do, their focus quickly changes away from the novelty of the medium onto measured effectiveness. In the end, it's usually something quantifiable on the bottom line that informs and guides their spending decisions.

The conversion stats are pretty impressive, with 35.5% of clicks resulting in conversion actions (versus 32% for the previous quarter and 26.6% for the same quarter of the previous year).

Video = Fastest Growing Website Feature for Small Businesses smbs conversion ratios

As a side note, keep in mind that it is also true that small business advertisers are becoming more and more sophisticated over time when it comes to tracking and measuring online advertising effectiveness.  This may just be an indication of that welcome trend.

Glance back over the stats I shared above… are you seeing a pattern?  More small businesses are spending their ad dollars online, implementing online video and targeting search… which is leading to better click through rates and higher conversion rates.  For us, it is affirmation that the advice we've been giving for years is becoming more widely accepted and is proving to be successful.

Summary & Takeaways for Small Businesses:

1) Get video on your website. There's not a single business I've met that can't find a way to use video to improve customer relations, branding, or profits.  When small businesses are racing to get their websites video-capable, you know it has officially moved from gimmicky entertainment to a legitimate business tool.

2) Remove the blinders and consider using going beyond Google for some of your search ad spend.  The click-through-rates may be rising faster on these engines, and there is certainly evidence to suggest that conversions for certain types of small businesses are higher on the secondary engines than on Google.  But at the very least: try advertising on search engines!

3) Finally, don't let your advertising efforts and your new found passion for video blind you from the most important conversion piece in the entire chain:  your own website. Make it video capable, make it pretty, and make it useful.  While video and search can be huge wranglers of traffic to your site, they are only part of the conversion process.  You haven't really helped your business until the conversion action takes place.

Search and video will definitely work to help market your business online.  But they are only pieces of the puzzle.  As most small business owners know all too well, at the end of the day you still have to have an attractive, useful product or service.  If you skip that step… all the fancy web marketing in the world won't save you.

  • Terry Lawton

    Nice post. Running a lean business means adopting new models for efficiency. Here’s a post which shows how custom apps are helping companies compete in the global marketplace

  • Fact & Fable Productions, LLC

    Here is an article including charts & graphs that set out how video production on the websites of small business fares in the world of internet marketing & advertising.

    • Denise Roberson

      Wonderful videos. The video cards are well done, the music is beautiful. Love them.

    • Petrushka Pavlovich

      Denise Roberson thank you,@[100000650234039:2048:Denise Roberson] for your generous compliment. I can't wait till we work together on your video.

  • Jessica Slate

    Video also induces an action with consumers. Whether they click on a link following the video or share it with friends on social media sites. People love video. Think about how viral certain videos have become...I never forget video with babies and animals!

  • Alexander_welz

    I am going to be using video in my marketing soon. This post was very helpful. Thank you.

  • Alexander_welz

    I love this posting. I am going to start using video in my marketing and this helps a lot. Thank you

  • Dominic Ziirii

    People reactive to visual stimulation, thats what makes it so effective.

  • Steve Dale

    I'm diving into video marketing for my mobile blind and shutter business. I'm having very little luck with PPC and No luck with my blogs. What am I doing wrong?

    • Mark Robertson

      That is a tough question to answer... Could be a million things.... Sorry
      my friend - keep trying though.

  • David Lelong

    Video is a great way for small businesses to create a more personal connection with their audience. I've seen email submissions and inbound phone calls increase by over 75% when a video is included on a website.

  • Garen

    I have found that outsourcing is great for videos. When I make them myself they are pretty lame ;(. I would use oDesk to find some cheap good video gurus. I outsource seo work for nickles and dimes there.

  • Stephanie Sammons

    What are best practices for producing quality video? Is it better to self-produce or outsource? I've seen some professionals online who look great on paper and in photos, but turn the video on and...well let's just say can do more harm than good.

  • jason

    I think video is the future of on-line marketing and websites - in our case atleast google seems to love them

  • Tai

    These are some great stats, thanks Mark. Another thing to mention here is that video itself can also increase your search engine ranking. I agree that getting tons of traffic to your video and on your site is only part of it. The video itself needs to be engaging in order to drive conversion rates.

    • Mark Robertson

      Absolutely and great point. Thanks Tai.

    • Mark Robertson

      TAI - BTW - can you email me - [email protected] - would love to talk about what you are doing - love the video on your homepage.

  • Wynne

    You mentioned some interesting topics here. Video on websites create more interaction. Great point. I'm a firm believer in this too. Why? check out how many people struggle to read words. I'm not saying people are stupid, it's just that the majority of people would prefer to watch a video than read lots of words.

    One point that I found noteworthy is that you mentioned click through rates increasing. Why on earth would that be? Is it because people are becoming trained to click more on videos? Or do you mean that click through rates of text ads are increasing as well?

    If you mean that click through rates of ads are increasing then I have strong suspicians why that might be; click fraud cheif amongst them. Google, Yahoo, and MSN have failed to control these fraudulent clicks properly, and have failed to give advertisers the tools to manage fraud - such as filtering out traffic that comes through proxies.

    • Mark Robertson

      Yeah, Im certain that they were referring to click through rates for PPC, as that is where they make their money - but I would take it with a grain of salt as it is possible that they made some internal changes that caused an increase in CTR so that they could charge their advertisers and make more money with less conversion oriented keyword plays.... Your point on fraud is a good one as well. My guess is that both that as well as the other research regarding PPC should be taken with a grain of salt due to the context of the source for the research - namely a company who's $$ is derived from SMB's PPC. That being said, I do not mean to state that they are (webvisible) not reputable - merely that the research is based entirely off their managed campaigns....