Customer demand is by far the most important factor driving business growth, according to a new survey of small-business owners. To help boost that demand, they say, they’re focusing on two key strategies: deepening relationships and creating value.
In the semi-annual survey by American Express OPEN, half of all business owners say increased customer demand is the main engine of business growth. That response handily outdistances other factors such as tax cuts (23 percent), access to capital (14 percent) and the ability to hire more employees (6 percent).
To stimulate that demand, the Small Business Monitor survey reported, nearly three-quarters (73 percent) of businesses are working to build better relationships with existing customers through regular follow-ups, and a third (34 percent) are actively using social media to keep connected with customers.
Nearly a quarter (24 percent) are highlighting how their products or services can save customers either time or money, and another 24 percent are bundling products or services to add greater value. Other tactics business owners told pollsters they are using include loyalty programs (20 percent), rewards/incentives programs (18 percent) and free trials of their products and services (14 percent).
Service and value resonate with consumers, who told American Express researchers that price, proximity and personalized service are the three biggest drivers in their choices of where to shop.
The growth in the use of by business owners is rooted in the desire to drive demand, the survey reported. When asked about the primary benefit of using social media for their businesses, nearly four in 10 entrepreneurs (39 percent) said it increases the exposure of their business.
Social media are a lower-cost marketing channel that enables business owners to talk directly to consumers, who say they’re more than willing to listen when it comes to special promotions and deals.
“For business owners, social media ultimately should be a two-way street,” said Susan Sobbott, president of American Express OPEN. “It’s about business owners connecting with customers and customers connecting with businesses. More than 10 percent of consumers we surveyed reported posting a review of a small business through social media channels such as Facebook, Twitter or Linkedin, and of these posts, two-thirds say the reviews have been positive.”