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BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights
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BIA/Kelsey's Local Commerce Monitor, Wave 16 - Core Highlights

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Data from BIA/Kelsey's Local Commerce Monitor, Wave 16 (Q3 2012) survey of SMBs (small medium businesses) on their marketing and advertising behaviors. The LCM survey tracks SMB ad and marketing …

Data from BIA/Kelsey's Local Commerce Monitor, Wave 16 (Q3 2012) survey of SMBs (small medium businesses) on their marketing and advertising behaviors. The LCM survey tracks SMB ad and marketing spending, Web footprint, media performance assessments, and opinions about key topics like emerging media and sales channels.

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  • 1st bullet – should we define “Core sample” more clearly?
  • Steve, again this is basically consistent, given margin of error, right? No real trend here?
  • We should add a guide to assessing statistical significance. For example: “Results based on 300 responses have a confidence interval of +/- 5.7% at the 95% confidence level.”
  • Transcript

    1. LCM Wave 16 Highlights: Core SMBs October 8, 2012
    2. 2BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs LCM Wave 16 Highlights (Core SMBs)  Executive Summary  Ad Spend & Media Mix  SMBs‟ Web Presence  Engagement with Customers  Appendix
    3. 3BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs Executive Summary  This Advisory presents the key top-line findings of our just-completed LCM Wave 16 survey (for the Core sample*).  Total spend on advertising and promotion is fairly stable, at about $3,000 annually. Spending intentions for the next 12 months are robust.  The migration from traditional to digital/online media continues.  SMBs continue to diversify the media they use for advertising and promotion, now using 5.8 different media on average (a large increase).  Social media, propelled by Facebook, appears to be rapidly evolving into a core medium for SMB advertising and promotion.  Mobile platforms, and the advertising/promotion formats that ride on them, have gained significant traction since Wave 15. *Since LCM Wave 14, we have surveyed two distinct samples of SMBs: Core and Plus Spenders. The Core sample consists of SMBs that spend an average of about $3,000 annually on media for advertising and promotion. Details on each sample are in the Appendix, slide 31.
    4. 4BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs Executive Summary  SMBs are increasing their engagement with customers in a variety of ways, including loyalty programs.  SMBs are building a deeper and broader web presence, manifested by an appreciably greater investment in online assets*. In fact, at a recent growth rate of about 29%, spending growth in online presence outpaced the roughly flat spending for total advertising/promotion spending.  This Advisory is being sent to the clients of all our Advisory Programs. Shortly after receiving this Advisory, the clients of each of our six individual Advisory Programs will receive findings from LCM Wave 16 with data and analysis tailored to their specific Advisory program. *Defined in the survey as: “[Spend for] Updating, maintaining and operating your company's online properties. These include your: Website, business profile pages, landing pages, pages on Facebook or other social networks, pages on Google or similar providers, blog, etc.”
    5. 5BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs LCM Wave 16 Highlights (Core SMBs)  Executive Summary  Ad Spend & Media Mix  SMBs‟ Web Presence  Engagement with Customers  Appendix
    6. 6BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs Total Spend on Advertising & Promotion (Last 12 Months) Sample Size = 300 Q103 $3,176 $3,041 $2,948 $- $1,000 $2,000 $3,000 $4,000 $5,000 LCM Wave 14 (4Q2010) LCM Wave 15 (4Q2011) LCM Wave 16 (3Q2012) *The wave-to-wave differences are within the surveys‟ margins of errors. There may be a slight downward drift of a few points annually, but we can‟t determine that conclusively from these results. Source: BIA/Kelsey's LCM Wave 16, Q3/2012 (and prior waves, if relevant). Methodology: Online panels. Findings may not be statistically significant. Most questions are asked to the full sample of approximately 300 in each Wave. However, where the sample size less than 300, that question has been asked of a subset of the full sample. Total annual spending on advertising and promotion (for the prior 12 months) registered again at approximately $3,000. This may suggest a slight downward drift in this type of spending* (the data below demonstrates a 3-year CAGR of -3%).
    7. 7BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs Spending Intentions for Next 12 Months Sample Size = 300 Q104 40.0% 3.7% 48.0% 8.3% 0% 10% 20% 30% 40% 50% Increase Decrease Maintain Not sure Net Increasers: 36.3% Source: BIA/Kelsey's LCM Wave 16, Q3/2012 (and prior waves, if relevant). Methodology: Online panels. Findings may not be statistically significant. Most questions are asked to the full sample of approximately 300 in each Wave. However, where the sample size less than 300, that question has been asked of a subset of the full sample. Respondents reported fairly strong spending intentions for advertising and promotion spending – with a net of 36% intending to increase spending.
    8. 8BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs Percentage of Budget for Digital/Online (Last 12 Months) Sample Size = 187 27.5% 24.3% 27.6% 0% 10% 20% 30% LCM Wave 14 (4Q2010) LCM Wave 15 (4Q2011) LCM Wave 16 (3Q2012) Q301 *As with some other findings, this observed increase is within the margin of error, but may be directionally correct. This metric is self-reported by the respondent, based on recollection. Source: BIA/Kelsey's LCM Wave 16, Q3/2012 (and prior waves, if relevant). Methodology: Online panels. Findings may not be statistically significant. Most questions are asked to the full sample of approximately 300 in each Wave. However, where the sample size less than 300, that question has been asked of a subset of the full sample. A modest increase was observed in the percentage of total advertising and promotional spending that went to digital/online media in the last 12 months*.
    9. 9BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs Percentage of Budget for Digital/Online (Next 12 Months) Sample Size = 187 Q302 29.0% 26.0% 29.0% 0% 10% 20% 30% 40% LCM Wave 14 (4Q2010) LCM Wave 15 (4Q2011) LCM Wave 16 (3Q2012) *As with some other findings, this observed increase is within the margin of error, but may be directionally correct. Source: BIA/Kelsey's LCM Wave 16, Q3/2012 (and prior waves, if relevant). Methodology: Online panels. Findings may not be statistically significant. Most questions are asked to the full sample of approximately 300 in each Wave. However, where the sample size less than 300, that question has been asked of a subset of the full sample. The pattern observed in the forward-looking estimate in Wave 16 is similar to what has been observed previously – SMBs intend to spend a little more of their total budget for digital/online media than they did in the prior 12 months*.
    10. 10BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs Media Used for Advertising or Promotion Sample Size = 300 S11 63.0% 53.0% 31.0% 27.0% 22.0% 19.0% 0% 10% 20% 30% 40% 50% 60% 70% Partial List *Note that this metric is purely “binary”, indicating the percentage of respondents that use a given media, irrespective of spending level. We measure spending with additional metrics. Source: BIA/Kelsey's LCM Wave 16, Q3/2012 (and prior waves, if relevant). Methodology: Online panels. Findings may not be statistically significant. Most questions are asked to the full sample of approximately 300 in each Wave. However, where the sample size less than 300, that question has been asked of a subset of the full sample. As in prior waves, we see a wide diversity of media usage in Wave 16. We were surprised to see the very high penetration of social media, which 63% of respondents report they now use. In addition, more than one-half (53%) use print or online Yellow Pages directories*.
    11. 11BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs Media Fragmentation Increased 3.0 3.1 3.1 4.6 4.4 5.8 0.0 2.0 4.0 6.0 2007 (Wave 11) 2008 (Wave 12) 2009 (Wave 13) 2010 (Wave 14) 2011 (Wave 15) 2012 (Wave 16) Source: BIA/Kelsey's LCM Wave 16, Q3/2012 (and prior waves, if relevant). Methodology: Online panels. Findings may not be statistically significant. Most questions are asked to the full sample of approximately 300 in each Wave. However, where the sample size less than 300, that question has been asked of a subset of the full sample. A key finding in Wave 16 is that media fragmentation increased significantly – as measured by the average number of different media used for advertising and promotion. The 5.8 different media now used, is almost a 90% increase in the number of media used just 3 years ago. Note: Each survey wave typically identifies a couple of additional media to choose from, so there may also be a slight “longer menu” effect reflected in this data.
    12. 12BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs Total Ad Spending Varied Considerably by Age of Business $2,324 $3,592 $2,941 $2,900 $0 $1,000 $2,000 $3,000 $4,000 $5,000 0-3 Yrs. 4-6 Yrs. 7-10 Yrs. 11+ Yrs. Overall average @ $2,948 *Note: In calculation of each metric above, “outliers” spending more than $40,000 annually were excluded. Source: BIA/Kelsey's LCM Wave 16, Q3/2012 (and prior waves, if relevant). Methodology: Online panels. Findings may not be statistically significant. Most questions are asked to the full sample of approximately 300 in each Wave. However, where the sample size less than 300, that question has been asked of a subset of the full sample. Q101 Sample Size=300 As in prior waves, we also found considerable variation in total spending for advertising and promotion by the age of the business, with a noticeable peak in spending for businesses that have been in business 4-6 years. This is intuitively reasonable, since these businesses have survived the initial shake-out phase, and are still building their customer bases.
    13. 13BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs Spend on Acquisition vs. Retention  Wave 16 has a new question about the purpose of spending for advertising and promotion. We asked respondents how they would categorize their spending – if most spending went for customer acquisition or for customer retention.  Key findings:  28% said their ad spend was roughly 50/50 against these two purposes.  Almost the same percentage, 29%, said they couldn‟t tell or didn‟t know.  Of the remaining 43% that were able to identify a dominant purpose for their ad spending, those that said their ad spend was primarily for customer acquisition outnumbered those that said their ad spend was primarily for customer retention by about 7 to 1*.  This metric measured ad spending alone, and did not cover other efforts, such as marketing, customer service, etc. These other efforts may be skewed more heavily towards customer retention. *The denominator used in this calculation was the number of respondents that said spending was primarily for one purpose or the other, not the total base. Of respondents in that category, some 86% said their ad spend was primarily for customer acquisition.
    14. 14BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs Spend on Acquisition vs. Retention Sample Size = 300 Source: BIA/Kelsey's LCM Wave 16, Q3/2012 (and prior waves, if relevant). Methodology: Online panels. Findings may not be statistically significant. Most questions are asked to the full sample of approximately 300 in each Wave. However, where the sample size less than 300, that question has been asked of a subset of the full sample. Q101AA 37.3% 28.0% 22.3% 6.7% 5.7% 0% 5% 10% 15% 20% 25% 30% 35% 40% >50% for Acquiring Roughly 50/50 Hard to Say Not sure >50% for Retaining The new question on the purpose of advertising and promotion spending produced results strongly weighted towards customer acquisition. (See contextual comments on previous page).
    15. 15BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs LCM Wave 16 Highlights (Core SMBs)  Executive Summary  Ad Spend & Media Mix  SMBs‟ Web Presence  Engagement with Customers  Appendix
    16. 16BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs $719 $876 $1,190 $0 $500 $1,000 $1,500 LCM Wave 14 (4Q2010) LCM Wave 15 (4Q2011) LCM Wave 16 (3Q2012) Annual Spend on Website & Online Properties Q307 Sample Size = 178 Note: Data above (average annual spending) is based on respondents that provided a number. “Don‟t Know” responses were excluded in these calculations. Source: BIA/Kelsey's LCM Wave 16, Q3/2012 (and prior waves, if relevant). Methodology: Online panels. Findings may not be statistically significant. Most questions are asked to the full sample of approximately 300 in each Wave. However, where the sample size less than 300, that question has been asked of a subset of the full sample. SMBs continue to increase their annual spending on their website and other web properties. The Wave 16 annual spend of almost $1,200 represents a CAGR (compound average growth rate) of about 29% over the last few years. This is a sharp contrast to the total spend for advertising and promotion, which primarily reflects media spending, which has been at best flat for the last 3 LCM waves (and may even be drifting downwards, per slide 6).
    17. 17BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs $719 $876 $1,190 $3,176 $3,041 $2,948 $0 $1,000 $2,000 $3,000 $4,000 LCM Wave 14 (4Q2010) LCM Wave 15 (4Q2011) Online Presence Media Advertising Media Advertising/Promotion CAGR= -3% Spend on Advertising/Promotion vs. Online Presence Q307 Sample Size = 178 Source: BIA/Kelsey's LCM Wave 16, Q3/2012 (and prior waves, if relevant). Methodology: Online panels. Findings may not be statistically significant. Most questions are asked to the full sample of approximately 300 in each Wave. However, where the sample size less than 300, that question has been asked of a subset of the full sample. Comparing the last three Waves for spending on advertising/promotion vs. online presence, it‟s conceivable that if trends continue, the two “buckets” of spending may approach parity in a few years. (Of course, three years of data isn‟t enough to project a trend with confidence, particularly in a volatile industry.) Online Presence CAGR= 29%
    18. 18BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs Online Properties  We asked respondents if they had various online properties, including the basic two shown on the next slide: website, landing page. (We‟re still interpreting the findings, which were were quite a bit different from the Wave 15 readings; the reasons for the differences aren‟t readily apparent in some cases.)  We were surprised by the lower readings on websites and landing pages than in Wave 15. In Wave 15, 66% of respondents said they had a website, whereas in Wave 16, this reading dropped to 50% (with another 20% reporting they plan to add a website in the next 12 months).  Possible reasons for this difference include:  Misinterpretation of the question (the wording changed in Wave 16).  A genuine drop in the percentage of SMBs that have websites (e.g., in favor of other types of web presence, particularly a Facebook page).  A possible abandonment of old websites that would cost too much to rebuild to current standards.  A skew in the sample (although the samples were very similar in firmographics, and other responses were consistent).
    19. 19BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs Online Properties Sample Size = 300 Source: BIA/Kelsey's LCM Wave 16, Q3/2012 (and prior waves, if relevant). Methodology: Online panels. Findings may not be statistically significant. Most questions are asked to the full sample of approximately 300 in each Wave. However, where the sample size less than 300, that question has been asked of a subset of the full sample. Q303A 6.0% 10.0% 23.7% 39.0% 20.0% 20.7% 50.3% 30.3% 0% 20% 40% 60% 80% 100% Website Landing Page Currently have Don't have, likely to add next 12 months Don't have, and not likely add next 12 months Not sure We also got a lower reading for SMBs with landing pages. In Wave 15, 44% of respondents said they had a landing page, whereas in Wave 16, the reading was just 30%. Another 21% said they are planning to add one in the next 12 months.
    20. 20BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs Mobile Websites Rapidly Gaining Traction 15% 22% 52% 11% Currently Have No, but will Add in Next 12 Mo's. No, and won't Add in Next 12 Mo's. Not Sure **A website optimized for access from a cell phone or other mobile platform. *Per the note on slide 5, we typically see a fall-off in stated intentions of one-quarter to one-half. So for this metric, that would translate into incremental additions of mobile websites in the 11%-17% range, not the expressed 22%. Source: BIA/Kelsey's LCM Wave 16, Q3/2012 (and prior waves, if relevant). Methodology: Online panels. Findings may not be statistically significant. Most questions are asked to the full sample of approximately 300 in each Wave. However, where the sample size less than 300, that question has been asked of a subset of the full sample. Findings on mobile were some of the most dramatically different from Wave 15 to Wave 16. A year ago, in Wave 15, only 8.7% of respondents reported having a mobile website*. In Wave 16, however, there‟s a dramatic increase to 14.7% that report having a mobile website, with another 22% saying they intend to add one within the next 12 months**.
    21. 21BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs LCM Wave 16 Highlights (Core SMBs)  Executive Summary  Ad Spend & Media Mix  SMBs‟ Web Presence  Engagement with Customers  Appendix
    22. 22BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs Percentage of Business From New Customers (Last 12 Months) Sample Size = 265 Q202 39.8% 43.7% 39.0% 0% 20% 40% 60% LCM Wave 14 (4Q 2010) LCM Wave 15 (4Q 2011) LCM Wave 16 (3Q2012) Source: BIA/Kelsey's LCM Wave 16, Q3/2012 (and prior waves, if relevant). Methodology: Online panels. Findings may not be statistically significant. Most questions are asked to the full sample of approximately 300 in each Wave. However, where the sample size less than 300, that question has been asked of a subset of the full sample. One of the basic tracking questions is “What percentage of your business came from new customers, in the last 12 months.” This metric stays fairly consistent wave to wave, at roughly 40%. Taken together with the findings on the purpose of ad spending (heavily weighted towards customer acquisition), this underscores the importance of the new customer acquisition process for SMBs.
    23. 23BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs Customer Engagement: Monitoring Customer Comments Online 57.0% 17.0% 24.0% 2.0% Yes No, but will Start No, and won't Start Not Sure *Per the note on slide 5, we typically see a fall-off in stated intentions of one-quarter to one-half. So for this metric, that would translate into incremental additions of the monitoring of customer comments in the 8%-13% range, not the expressed 17%. Source: BIA/Kelsey's LCM Wave 16, Q3/2012 (and prior waves, if relevant). Methodology: Online panels. Findings may not be statistically significant. Most questions are asked to the full sample of approximately 300 in each Wave. However, where the sample size less than 300, that question has been asked of a subset of the full sample. As part of our increasing attention to social media, we ask several questions about how respondents deal with customer comments that are posted online (in various locations). A full 57% say they already monitor customer comments online, and an additional 17% plan to start within the next 12 months, for a total of 74%.
    24. 24BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs Customer Loyalty Programs Very Popular Sample Size = 300 Q114 34.0% 21.3% 43.3% 1.3% 0% 10% 20% 30% 40% 50% Currently Have No, but will Add in Next 12 Mo's. No, and won't Add in Next 12 Mo's. Not Sure 55.3% *Per the note on slide 5, we typically see a fall-off in stated intentions of one-quarter to one-half. So for this metric, that would translate into incremental establishments of loyalty programs in the 10%-16% range, not the expressed 21%. Source: BIA/Kelsey's LCM Wave 16, Q3/2012 (and prior waves, if relevant). Methodology: Online panels. Findings may not be statistically significant. Most questions are asked to the full sample of approximately 300 in each Wave. However, where the sample size less than 300, that question has been asked of a subset of the full sample. We added new questions about customer loyalty programs, which we defined as “offering discounts or special promotions to frequent customers.” The most basic question asked if the SMB had such a programs, and if not, if they intended to add one. More than one-half (55%) of respondents reported they either have a loyalty program or intend to offer one in the next 12 months*.
    25. 25BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs LCM Wave 16 Highlights (Core SMBs)  Executive Summary  Ad Spend & Media Mix  SMBs‟ Web Presence  Engagement with Customers  Appendix
    26. 26BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs Appendix: Addition of Tabs to Indicate Survey Sample  There is now a “tab” along the right-hand edge of each slide. This indicates at a glance which LCM data sample (Core or Plus Spenders) is being used on that slide. We think this is important now that we have a Plus Spenders sample of 300 respondents as of Wave 16, and will be publishing more material on Plus Spenders.  Although many slide decks will draw exclusively from a single sample (either the Core sample or the Plus Spenders sample), the addition of this tab will be a convenience, and will reduce the potential for ambiguity in interpreting the LCM survey results.
    27. 27BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs Appendix: Notes on Interpreting the Findings About Intentions  In several questions, the LCM survey asks respondents about their intentions regarding use of specific media or platforms in the next 12 months. For example, one of these questions is about their intentions to add a mobile website (if they don‟t already have one) – slide 20.  We report the findings in our results, although these are only intentions. Of course, there is a fall-off between expressed intentions and actual follow-through, when we ask the same question a year later. The amount of fall-off is typically between one-quarter to one- half of the expressed intention.
    28. 28BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs Appendix: Wave 16 Process Notes  This report presents the findings from Wave 16 of our annual LCM survey (Local Commerce Monitor), administered Q3, 2012. The last few waves, we have given the LCM survey to two separate groups of SMBs:  A Core sample, for which there is no minimum annual spending requirement (although the average annual spend typically falls around $3,000).  A Plus Spender sample, for which there is $25,000 minimum annual spending requirement.  In Wave 16 we used 300 respondents for the Plus Spender sample, the same size as our Core sample. (In the previous two waves, the Plus Spender sample was one-half the size of the Core sample). This increase in the size of the Plus Spender sample will support more granular conclusions from the Plus Spender sample, as well as direct comparisons to the Core sample.
    29. 29BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs Appendix: Wave 16 Process Notes  Wave 16 included many new questions and response options.  In particular, there are additional survey questions (and response options) in the areas of:  Online presence  Use of social media  Use of mobile platforms  Use of video  Attitudes and intentions about customer loyalty programs  Use of specific vendors for selected purposes (e.g. email, website registration, SEM purchases, etc.)  We will publish additional Advisories and Client Information Bulletins with the findings from our Wave 16 LCM survey, for both the Core and Plus Spender samples, in the next couple of months.
    30. 30BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs Appendix: LCM Surveys  The LCM survey is a “tracking” survey, monitoring changes over time in a wide variety of metrics relating to usage, spend, attitudes and intentions of SMBs regarding SMB advertising, promotion, marketing and related services.  The key goals are to understand:  Media usage  Media budget allocation  Usage of specific features and capabilities (e.g. video)  Performance assessments (ROI) of various media  Attitudes towards emerging media  Usage of specific vendors for several
    31. 31BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs Appendix: LCM Surveys *Calculations of averages exclude outliers. Outliers are defined as:  Core: Spending over $40k annually.  Plus Spenders: Spending over $500k annually.  UK: Spending over $500k annually. UK spending data is converted from British Pounds Sterling to US Dollar equivalents. Plus LCM Survey Minimum Annual Spend Average Annual Spend* Core No Minimum ~$3,000 Plus Spenders $25,000 ~$82,600 UK No Minimum $2,000-$3,000 The full „family‟ of LCM surveys now consists of the following:
    32. 32BIA/Kelsey Local Commerce Monitor™ (LCM), Wave 16, Q3 2012 Proprietary and Confidential. Copyright © 2012 BIA/Kelsey. All Rights Reserved. Data:CoreSMBs Appendix: LCM Surveys  The LCM survey (Local Commerce Monitor) is our flagship survey, started in 1999.  LCM sample size is approximately 300 respondents per wave (for both Core and Plus Spender samples, as of Wave 16). The samples are drawn from seasoned panels managed by long- established operators.  The survey takes respondents ~20 minutes to complete (~65 total questions).  Most recent waves:  Wave 16, conducted Q3 2012  Wave 15, conducted Q4 2011  Wave 14, conducted Q4 2010  Wave 13, conducted Q3 2009
    33. Questions and Comments: Julie Tsoi (pronounced “Choy”) BIA/Kelsey Director, Business Development, Western US, Asia & Australia (650) 969-2425 office (650) 353-6743 mobile jtsoi@biakelsey.com www.biakelsey.com Copyright © 2012 BIA/Kelsey. All Rights Reserved. This published material is for internal client use only. It may not be duplicated or distributed in any manner not permitted by contract. Any unauthorized distribution could result in termination of the client relationship, fines and other civil or criminal penalties under federal law. BIA/Kelsey disclaims all warranties regarding the accuracy of the information herein and similarly disclaims any liability for direct, indirect or consequential damages that may result from the use or interpretation of this information.

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