Customer growth decisions for the SMB CEO
The time is now. Rarely have economic factors aligned to create a growth environment like we see today. Historically low unemployment, record low interest rates and inflation that barely causes a ripple are all drivers to a surge in small and mid-sized business growth. While there are obstacles in future and unforeseen events yet to happen, economic confidence has soared according to the Q3 2017 Confidence Index survey of 1490 Small and midsized Business CEOs. While slightly off from their 10-year record highs from Q4 2016, driven by post-election enthusiasm, CEO confidence remains exceptionally high.
Our recent research study of 1352 SMB CEOs, Customer Growth: Decisions for the SMB CEO, we found 37% reported double-digit growth in 2016. Another 42% anticipate double-digit growth in 2017. And 28% reported double-digit growth for both years, confirming the strong economic environment.
However, not all boats rise with the tide, as we have been lead to believe. Astonishingly, 23% of SMBs reported flat to declining revenues in 2016, 12% report the same for 2017, with 8% seeing flat to declining revenues for both years.
Against this backdrop, we looked to understand what high growth (HG) businesses are doing as compared to those with no growth (NG). While many individual variables come into play, those seeking to reverse the revenue trend as well as those looking to extend the double-digit growth are faced with the same set of decisions.
- What are the key strategic decisions high growth SMB CEOs are making for customer growth?
While the strategies they pursue are similar, HG CEOs are 30% more likely to engage in all five top strategies and are better at execution.
- What investments are high growth SMB CEOs making in customer engagement?
Making decisions is what CEOs do, and where they make their investments shows their commitment. While both HG and NG businesses are investing in marketing, the HG CEOs focus their investments on talent, training and technology.
- What are the winning initiatives of high growth SMB CEOs for marketing, sales and customer service?
A deeper dive into the HG SMBs winning initiatives for marketing, sales and customer service of demonstrates an interesting blend of new, digital initiatives along with traditional, analogue tactics. For marketing, while digital methods grab attention, traditional human-to-human connections remain essential to new customer growth. In sales, the fundamentals of hard work, speed and attention to customer needs are universal requirements for growth and in customer service we found commitment to quality and responsiveness builds trust and credibility, a requirement to retain customers.
- How are high growth SMB CEOs leveraging technology?
Our research found HG businesses are almost twice as likely to have leadership in place across all three functions compared to NG companies, and in turn see a 20% more effective use of technology as compare to 59% of NG companies reporting ineffective use of technology.
Exploring these questions, analyzing the strategies, investments and initiatives of HG business is the objective of our study.