SMB Technology Market Predic5ons in detail 2012 Top 10 Sanjeev Aggarwal Laurie McCabeSMB Group | 17 Lancaster Rd., Northborough, MA 01532 | 508‐410‐3562 | informa5on@smb‐gr.com
1 Economic Anxiety Lowers SMB Revenue Expectations & Tightens Tech Wallets • SMBs are less confident about their revenue prospects for 2012 than they were in 2010 • Many SMBs are tightening their tech wallets: more SMBs are forecasting flat or decreased IT spending for 2012 compared to 2011. Medium 77% Small 2011 77% 2011 businesses businesses expecting expecting growth 2012 56% growth 2012 63% To loosen tight SMB purse strings, vendors must : •Deliver a rock-solid case for how their solutions help address top SMB challenges--attract new customers, grow revenues and maintain profitability. •Broaden subscription-based cloud solution options •Offer flexible, alternative financing
The SMB IT Progressives Gain2 Ground Investing more • Progressive SMBs plan to increase IT spending--they see technology 73% as vital for business transformation, creating market advantage and expect revenue increase in 2012 leveling the playing field against bigger companies. • Progressive SMBs are more likely to rate factors such as easier to customize for my business, strong reputation and brand and ability Investing less only17% to provide local service and support higher than other SMBs. • They invest more on technology and see the expect revenue increase in 2012 results in terms of higher revenue expectations. Technology vendors need to: • Develop different marketing campaigns and more sophisticated solutions for Progressive SMBs to win in this very important segment.
3 The SMB Social Media Divide Grows SMBs already • These “strategically social” companies use social media for more activities, use more channels and are more satisfied using social media with the business results than more informal, ad hoc social media users. 50% • Ad hoc users say that they don’t have enough time to use social media effectively; they can’t decide what social media strategies and tools will work best; it’s too difficult to integrate social media with sales, marketing, service and other business processes; and that they are unable to SMBs who plan to measure value from social media. use social media in • SMB social media “haves” will gain business ground on the the next 12 months “have-nots” in an exponential manner. SMBs who take a strategic and 25% structured approach to social media 50% Technology vendors need to: • Provide the “have-nots” with better social media guidance and easier to use, better integrated and more affordable social media management solutions.
4 Cloud Becomes the New Normal In the past 24 months % of small businesses purchased or upgraded cloud accounting/ERP solutions, 7% SBs that plan to purchase them in the next 12 months. • Demand for cloud-based solutions is accelerating in almost all 13% solution areas. • Areas that show the biggest potential for cloud gains in 2012 are marketing automation, business intelligence/analytics, and desktop virtualization solutions and services. Technology vendors need to: • Recommend cloud computing based on reduced capital costs, speed to deploy, real- time collaboration and visibility-compelling. • Cater to demand for anytime, anywhere any device mobile access to applications will also accelerate cloud adoption
5 Mobile Application Use Extends Beyond Email to Business Applications Highest increase spending on mobile devices and services in companies with : • SMBs plan to significantly increase spending on mobile devices and services in the next 12 months. • Mobile use of collaboration apps (email, calendar, etc.) is now mainstream. • SMBs are now mobilizing <5 employees employees employees 5-49 >50 business applications. The strongest areas for current and planned mobile app use : 52% 59% 59% 69% Mobile Time Field Customer payments management service information management
6 Increased SMB Business Intelligence (BI) and Analytics Investments Are Sparked by the Social-Mobile-Cloud Triumvirate • The social-mobile-cloud triumvirate will fuel new and increased SMB investments in this area. Purchased/upgraded • As SMBs try to get a better handle on customers’ and a BI solution prospects’ opinions and influence networks, interest in sentiment analysis and social graphing solutions will grow. • New mobile access capabilities and applications that provide SMBs with just the information they need, when and where Within the they need it, will spur interest as well. past 24 months 16% 29% 1/3 In the next 12 months •! Roughly a third of SMBs use or plan to use cloud-based BI and analytics 16% 28% solutions—and an expanding array small medium of cloud options will make it easier businesses businesses and more affordable for more SMBs to deploy these solutions.
7 Managed Services Meet Mobile • Many SMBs will continue to use existing on-premises apps SMB adoption of mobile phones and even as cloud momentum grows. tablets is now on par with that of • SMBs will continue to grapple with IT infrastructure traditional landline phones. management—even as new mobile device management and governance challenges grow. • Many employees are more likely to lose a smart phone than a laptop, which increases security issues. • The “bring your own device” (BYOD) phenomenon creates additional concerns, not least of which is to create a firewall between personal and business data. The opportunity for vendors : • Ample opportunity for wireless carriers, networking vendors, MSPs and others that can provide integrated and automated managed services that encompass management of cloud-based infrastructure, all end- point devices, and network services.
8 The Accidental Entrepreneur Spikes Demand for No-Employee Small Business Solutions 27 million • According to the U.S. Census Bureau, small businesses without small business companies a payroll make up more than 70% of America’s 27 million companies, with annual sales of $887 billion. Annual sales • More accidental entrepreneurs view what they’re doing as a • long-term business venture instead of a short-term stopgap. They see themselves more as business owners than as $887 billion. freelancers or contractors—but they have no intention or desire to hire employees. • This will spike demand for—and growth of—applications and services that help them to achieve their business goals without adding employees. 30% Small businesses with payroll Small businesses with no payroll 70%
9 Increased Adoption of Collaboration and Communication Services in Integrated Suites • The SMB pendulum is swinging from point solutions for voice, communications, social media and collaboration solutions to integrated suites. • Small businesses are slower to make this leap, but a transition is under way here too. • By moving from disparate point solutions to an integrated offering, SMBs can avoid the hassles of learning to use multiple user interfaces, going to different sites to login and remembering different Medium businesses using passwords—in short, things that waste time and Integrated collaboration suite frustrate users. • They also can lower costs and improve their ability to 28% 35% collaborate effectively. • A growing roster of low-cost (or free), easy-to-use integrated collaboration suites are adding fuel to the convergence fire—although vendors will still need to address the obstacle of user resistance to learning something new. currently using will do so in the next 12 months
10 The IT Channel Continues to Shape-Shift • As with any significant inflection point, the cloud-social-mobile trend necessitates that older partner models continue to move aside as new, more relevant ones take shape. • Cloud computing reduces the need for hardware, software and infrastructure deployment skills, and ups the ante for educational guidance, business process transformation and integration skills. • Non-traditional IT partners, such as creative and marketing agencies, have stepped in to fill a gap by providing social media and digital marketing services for solutions such as Radian6 and HubSpot • Partners need to bring more mobile know-how to help SMBs develop and implement mobile strategies, and offer solutions to manage mobile devices and applications and provide better network performance, reliability and redundancy. Virtualization Marketing Automation Information ERP VoIP Search Consulting Integration Security Analyt ics Cloud HARDWARE and Managed ECRM Mobile Business Services Social Solutions Managed Mobility Cloud Services
SMB MARKET STUDIESClick the links below for informaKon about our SMB market studies:2010 SMB Mobile SoluKons Study, December 20102011 Impact of Social Business in Small and Medium Business Study, April 20112011 SMB CollaboraKon and CommunicaKon Study, September 20112011 Small and Medium Businesses Routes to Market Study, November 20112012 SMB Mobile SoluKons Study, February 2012SMB GROUP, INC.The SMB Group focuses exclusively on researching and analyzing the highly fragmented “SMB market”—which is composed of many smaller, more discrete markets. Within the SMB market, the SMB Group’s areas of focus include Emerging Technologies, Cloud CompuKng, Managed Services, Business and MarkeKng ApplicaKons, CollaboraKon and Social Media SoluKons, IT Infrastructure Management and Services, and Mobile SoluKons. Read our 2012 Top 10 SMB Technology Market PredicKons for our views on game changers in these and other areas of the SMB market.