It's National Small Business Week (NSBW), which is driven and sponsored by the Small Business Administration (SBA). Although customer relationship management (CRM) vendor Salesforce doesn't mention it on its website, the company is aiming to help out with its just-released Small & Medium Business Trends Report. While this annual report is understandably skewed towards companies heavily involved with optimizing their sales processes and even implementing (CRM) systems, it's actually a well-researched document that contains some interesting insights into the general state of small to midsize businesses (SMBs) and startups, too.
Salesforce's report was expansive, extrapolating its findings from a recent survey conducted on more than 2,000 SMB owners and operators. This is Salesforce's third iteration and the company decided to introduce it to the media via a small dinner event held in New York City last week. The dinner was attended by an interesting mix of content creators, media, and small business owners (also Salesforce customers), and the casual conversation mirrored much of the report.
Different Priorities Between Genders
For example, appropriate to NSBW, a key finding in the report referred to the top constraints experienced by entrepreneurs, meaning the biggest hurdles that entrepreneurs felt they had to conquer in getting a new venture off the ground. In an attempt to show gender variations, Salesforce organized much of its report so that it showed the differences between male and female respondents. When it came to constraints, both genders mentioned funding; however, women named it their number one concern while men placed it second behind hiring the best possible talent. The women at the dinner agreed, citing experiences in which they felt obtaining funding was made more difficult due to their gender. Of course, these were often experiences had while dealing with angel investors or venture capitalist (VCs).
This is where female and minority-run small businesses would do well to take a closer look at the benefits available through the aforementioned SBA. As a government-run agency, the SBA has funding options specific to women and minorities as well as via other initiatives such as the Women-Owned Small Business Federal Contracting program. Additionally, if you opt to take advantage of the SBA's long-time SCORE mentoring program, many of these problems can be mitigated. That's because participation can help pave your way to an SBA-backed funding source and often eases even inadvertent diversity discrimination since the concept, the business plan, and the stakeholders are all known quantities before funding options are even discussed.
(Image credit: Salesforce)
Returning to the Salesforce report, I found the report's conclusions about the technology priorities of SMBs to be a little less helpful since Salesforce is a CRM company and this section of the report harped rather heavily on how CRMs are key to a successful growth path. It even went so far as to describe "declining/stagnating SMBs" as being worried about stodgy things like internet hosting and financial software. While I get that it's a marketing effort and an expensive one at that, this part made me wonder which of Salesforce's small business respondents would classify themselves as running a declining business?
Still, the report did offer useful insights on whether or not small businesses were looking at more advanced technologies, such as artificial intelligence (they are) and how they're most likely to employ them (again, mostly as part of the sales process according to Salesforce—though I'd expect that would depend entirely on the respondent's core business process).
(Image credit: Salesforce)
Trust: An SMB Marketing Advantage
More valuable to me was a smaller section near the middle of the report where survey respondents identified "trust" as being of primary importance in all of their business relationships—be it with customers, employees, or partners. That's a solid point and one that many small businesses overlook in the rabid quest to be perceived as larger than they are. What I also found interesting about this was the response this conclusion received at the dinner last week. There, trust wasn't called out as simply an important goal, it was actually described as a key advantage and marketing tool that small businesses enjoy over their larger competitors.
"Small businesses have an easier time connecting with their customers," said Charlie Kroll, co-founder and President of Ellevest, one of the two Salesforce customers in attendance at the dinner. Ellevest is a digital-first investing platform based in New York and comprised of Ellevest Digital and Ellevest Premium. It's built to be gender-aware and thereby help women manage wealth and plan for retirement (though men are also welcome). As part of that, Kroll explained that the company engages with its customers by using a prolific and entirely original content marketing engine. This is in sharp contrast to many other businesses that often simply rebrand content from third-party providers. That doesn't work for Ellevest according to Kroll.
"We create all our content in-house because it's a critical part of building a relationship with our customers," he said. Trust is certainly key for an investment advisor but it's something that should be important to any business. Kroll especially pointed to instances in which the organization and customers needed to deal with mistakes and saves.
"If customers perceive you as hearing their complaints, understanding them, and making a good faith effort to fix them, then you can turn a bad situation into a positive experience and promote trust," said Kroll. "Be open about your vulnerabilities."
Interestingly, the Salesforce survey respondents seemed to agree entirely, with 90 percent of them indicating that trust is paramount in any relationship. However, as direct human interaction was cited as being a key component of building trust, this looks like a new challenge for vendors trying to sell AI as a cost-saving insert into as many customer interactions as possible. It will be interesting to see how Salesforce's smaller customers react to this hurdle in the future.