2019 marked our inaugural prognostication of 10 trends we saw rising across a new world – a world we helped name and give voice to – B2SMB.
For 2020 we’ve doubled the size of our crystal ball, offering you, dear Reader, these 20 trends for consideration and application in the New Year.
From our unique perspective connecting literally hundreds of B2SMB brands and now thousands of B2SMB professionals, we’d like to believe that our predictions reflect what we see, hear, read and argue about daily. As in 2019, expect to see many of these “trends” brought to life during our Leaders’ Forum, May 12-13 in Napa. In the meantime, we hope our observations can serve as illumination, as inspiration, or as backstop to your 2020 strategic plan, now only a few days old.
Without further ado, here we go:
- Follow the Money – Money makes an SMB’s world go ‘round. How they get the money, handle the money and manage the money is an axis on which they spin. So B2SMB Fin and Fintech players will continue to emerge in 2020 as the MVPs of the marketplace. We predict B2SMB players in other SMB verticals solving other SMB problems will look up from their own offerings and see a need to partner in some way with B2SMB Fin and Fintech. Why? Customer trust – a vital B2SMB quality. Note that 5 of the top 20 most trusted B2SMB Brands in the Alignable Small Business Trust Index are Fin players, like Authorize.net, Square and Stripe.
- Smaller Is Bigger– as if the SMB market wasn’t fragmented enough, we’re all witnessing the rise of the Micro-Business. Fueled in part by a “gig economy,” in part by a couple of generations recognizing they can count on no one but themselves, the VSB (Very Small Business) has become an UAO (Unavoidable Opportunity. Like their only-slightly-larger brethren, VSBs crave at least the appearance of bespoke B2SMB solutions, but as players like Honeybook have recognized and embraced, VSBs have real businesses to run and they are willing to pay for help. Note of caution: don’t approach VSBs – or any SMB for that matter – with “dumbed down” versions of enterprise offerings.
- SMBs Will Hit the Bricks (and Mortar) Hard – we all know that online shopping has vastly eroded traditional destination retail. It’s devastated bricks & mortar sellers of Office Supplies. We’re not alone in predicting the impending demise (or enormous re-trenching) of Office Depot and Staples, as both claim to be moving towards more Big-B2B-direct and more online futures (read far fewer stores.) Will SMBs come along for that journey? We’re skeptical, especially since neither brand can claim any substantial loyalty amongst SMBs – and who could when it comes to paper and ink? As SMBs eschew the trip to pick up what now comes so easily to their doorstep, we see the trend lines going one way as Amazon becomes SMBs’ “grocery store” of choice for daily needs. But perhaps a disruptor will rise up soon? Check out The Green Office.
- Easy Lending Will Alter SMBs’ Harsh Reality – it used to be that only the strong SMB survived – arguably the REALLY strong. If you needed to borrow, you were likely in trouble, if not in dire straits. Worst of all, if you needed it, you likely couldn’t get it. Meaning that only those SMBs with the cash flow to cover every step forward survived, and everyone else became a failure data point. Now players like Kabbage and Fundbox are easing how – and how much – SMBs can get. As some have begun to observe, access to funding buys fringe SMBs time, and time leaves some to linger longer than nature would have allowed in the past. Good thing? Not sure – yet.
- SMB Micro-Niches Will Have Broadening Appeal – offered as evidence, we see successful B2SMB offerings that address tow-truck drivers (Urgent.ly) The narrow vertical is making a comeback in B2SMB. Less now an issue of fitting thin resources to a skinny business opportunity, we see micro-niches providing even big B2SMB players the footholds, laboratories and margins they crave. Let’s face it – dominating share across 40,000 independent pizza shops, like Slice, is a win. Our advice? Watch these narrow channels that represent populations of 10-50K SMBs for opportunities.
- Chat Becomes a Channel – According to SuperOffice, live chat will grow another 85%+ in 2020. No wonder B2SMB Brands are waking up to the owned, interactive media that lives right in-house – their own online conversations with SMB customers. The smartest B2SMB brands are now optimizing this channel for all the potential it offers – for sales, for research, for more. Adding to this, a study by AMA found that live chat can be used effectively to improve marketing awareness (+29%), early stage sales development (+32%), and post-sales customer support (+39%). Chat early and chat often in 2020.
- Local Becomes the Bullseye – as retail learned in the 2000’s and CPG learned in the 2010’s, localization brings greater efficiency AND effectiveness to broad-based brand success. Yes, target SMBs share commonalities by category but diverge greatly by street, by community and by ZIP, even within categories. We see localization impacting marketing most of all, but it’s not just about placing your ads in the right spot. We see everything from localization of User Groups to geo-based feature sets that accommodate local business practices and regulations. At a minimum, draw distinctions to your approach in urban vs. rural locales, or boom vs. bust economic zones.
- Cause Marketing Comes Home – SMBs have a special affinity for the causes that live next door. As likely the most active Members of any given community, SMBs know their local cause scene, from the High School Booster Club to the local economic development Board. According to Beth Negus Viveiros in Chief Marketer, B2SMB brands need to take a stand – and they will be rewarded. Square grounded SMB outreach in 2019 in local community events, connecting with local community SMB Influencers and building a more ground-level affinity between the ubiquitous little white payment fob and thousand of SMB users. While causes can rise to global concern, it’s still best to act local.
- One More Year Means No More Excuses – as Brian Moran of Small Business Edge observes, the apparent deferral of a recession through 2020 will give smart SMBs an opportunity to get their houses in order – pay down debt, refurb and rehab, and heck, even lean into some long-forestalled opportunities. SMBs natural restlessness will move them from hope to plan to action early in the year as most know the good news has had a historically unprecedented “good run.” The first question to ask SMBs in early year sales calls? “How can I help you take advantage of this economy?”
- Duh – It’s All About Delivery – for those who still believe that a “perfect” product or service feature set can overcome a flawed customer experience, we’d like to walk you through 2019’s graveyard of B2SMB fails. SMBs feel no obligation to excuse your poor delivery infrastructure, so pay close attention to every customer touchpoint because it could be your last. Step 1? Start listening. What SMBs say about your CE pales to the way they say it – as in, don’t stop at faint 3-star praise of your product or service. Looking for a clue on what SMBs expect of you? Read any number of countless advice columns directed at SMBs on how to improve their CE. What is expected of SMBs is – duh – expected of you!
- For SMBs, Opportunities Will Trump Problems – with no pun intended, we see SMBs migrating from fixes to futures, driven in part by the old adage that “success helps hide a multitude of sins,” but also charged by a newly acquired self-confidence in economic boom times. Savvy B2SMB brands will lean into helping SMBs unlock their 2020 opportunities – to get online, to go global, to expand into new verticals or new offerings. As we said above, the call-to-action for SMBs is simple and direct: let’s unlock your business’ potential here and now.
- Voice Search Speaks Volumes – Google rarely taps us all on the forehead and says “Pay attention,” but listen up – 50% of all search will be done via voice this year! You simply must get your head wrapped around Voice. Google scientists have been forthcoming, if only to forestall the inevitable algorithm-change backlash. Safe to say that our voices make search “messier,” sweeping in many, many more long-tail of keywords (witness my own trial-and-error when searching my brain for the right spoken word.) Check out this excellent primer on voice search from Wordstream, and raise your voice (savvy) now.
- SMBs Will Have an Appetite for More Risk-Taking – They’ll Just Need Help Being Better at It – with all respect, SMBs use “limited inputs” when taking risks – a spoonful of self-guided research, a pinch of friends-and-family advice, and too much gut instinct can be a recipe for success – or disaster. B2SMB Brands that provide data, insights, and even consultation on the risks SMBs will want to take in 2020 will be rewarded well into the future. A great place to start is your own data derived from SMB customers. Mine it for insights on what works and what doesn’t, from broad-based usage stats to individual success stories. Then use the full quiver of media to tell these stories in memorable ways.
- SMB Service Businesses Will Play for Keeps – as Small Biz who serve with service have grown just plain smarter, they’ve gained confidence in their ability to listen, respond and ultimately win more and bigger customers. In other words, they’re going for it. No longer just “shingle hangers,” these Service-based enterprises will compete more aggressively for bigger prizes, supported by tech, by intelligence, and by their innate agility. These are SMBs who generally know best what it takes to meet the next big opportunity, so position your B2SMB brand as the fast, flexible and effective partner in seizing the day.
- SMB Martech Will Get Shopped – it’s not like Martech has been a quiet backwater in the ocean of B2SMB M&A activity, but expect to see players who help SMBs win and grow customers and revenue to be on a number of shopping lists in 2020. The reason? From banks to carriers to accounting and ops platforms, everyone in B2SMB wants to become indispensably sticky as a revenue (not just expense) contributor. Watch Mark Macleod and SurePath Capital’s excellent reports and research, especially their SMB Index for the latest.
- SMB E-Commerce Will E-Xplode – as we noted, SMBs success in 2019 will embolden many to move into new channels, and the most obvious place to start – or to expand – is online. Note that Amazon is becoming very, very effective at selling the turn-key e-commerce solution for SMBs, but we expect to see many SMBs take their own path (or at least supplement their Amazon presence) with stepped-up online offerings and sophisticated CE. Mostly gone are the days that “the neighbor’s kid builds our website.” Instead, expect the intelligence gained as e-commerce consumers will inform and instruct SMBs on what works in e-comm.
- SMBs Get The Picture on Video – as Brian Moran notes, video will become the “go-to source for connecting with customers and building brand awareness for SMBs in 2020.” Production is no longer the barrier it once was, and once again, SMB consumption of video content will demonstrate it’s real value. With more than 60 players in Video CMS out there, expect there to be increasing enablement and market expansion. But does your B2SMB brand get the picture? Note that what SMBs do in their own business for their own customers quickly becomes what they expect from their partners. Enough said!
- Stories Become The New News – sure, we’ve all witnessed the rise of SnapChat, but according to TechCrunch, Stories (including those formats from Facebook & Instagram) are growing 15x faster than NewsFeeds. SMBs are catching on quickly to this new means of communicating with customers because frankly, Stories are easy, immediate and highly effective for the guerilla-marketer SMB. Ride the wave and use Stories in your own B2SMB marketing, sales and service outreach.
- The Gig Economy Becomes an SMB Resource – as SMBs stay agile and lean, Varun Raghunathan of FreshCaller expects them to fill more and more resource needs with what we used to call “freelancers.” Contrary to old prejudices, Gig-players provide much-in-demand expertise – as well as more arms and legs – to get new jobs done. Talk about a win-win! We see supply and demand growing in lock-step, as Gig-player-options grow right in front of SMBs in need. And expect disruptive new players to facilitate the connections!
- 5G Becomes GGGGGreat for SMBs – with apologies to Tony the Tiger, we firmly reject all hating on 5G. As noted in so many of our 2020 trends, bandwidth is a critical enabler of Small Business success, and that demand won’t be ignored or abandoned at the first sign of a growing pain. Alot comes with the 5G package, impacting video, data exchange, the IoT – but watch SMBs use faster pipes to add more on top of more. Watch the major carriers to drive suggested use across SMB channels, for both wide and narrow audiences.
PLUS ONE BOLD PREDICTION: A Handful of Major Brands Will Give Up on SMBs – it seems almost heresy to us here at the B2SMB Institute, but we predict a few household names in B2B products and services will simply “retire from the field” that is the $500 Bil Small Business marketspace. We make this bold prediction based on direct dialogue with those same household names (who of course will remain nameless) and what we’re hearing is an effective abandonment of any SMB-directed outreach. The rationale is frequently grounded in an unrealistic expectation that the SMB marketplace would and should provide top-line relief to a B2B brand’s flattening Business-to-Large-Business sales curve. That’s a shame, and smacks of “blaming the customer” for poor offerings, poor delivery and poor understanding of SMBs. We suggest anyone giving up on Small Business spend time studying our most successful Institute Members for playbooks on how to win the toughest customer on planet Earth, the SMB.