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Small and Medium-Sized Business Barometer Reveals Majority of Businesses Are Generating Sales Online
Key findings reveal businesses rely heavily on their Websites and Internet marketing efforts for positive sales leads.
from Interland

Interland, Inc. (Nasdaq:INLD), a leading provider of websites and online services for small and medium-sized businesses (SMB), today announced the results of its Summer 2005 Small and Medium-sized Business Barometer, a nationwide survey of 780 leaders of small and medium-sized businesses.

The findings reveal that the majority (57 percent) of business leaders with websites said they generate monthly revenue through online purchases or offline purchases that were influenced by their website. The survey also showed that of those businesses which are actively using eCommerce features (such as online payment transactions, online business forms or email requests) to sell through their website, 82 percent are receiving monthly revenue from their website.

Of the 72 percent of respondents with a business website, more than half are using or interested in using email marketing (60 percent) and search engine optimization (54 percent). Additionally, 78 percent report their business is healthier - has a competitive advantage or stronger economic footing - because they have a website, and 76 percent say their website generates leads for their business.

Online Benefits to Small Businesses

The findings also reveal that the majority of business leaders surveyed (61 percent) are already using web-based applications to manage business functions such as banking, company email, accounting, payroll and search-engine optimization. Nearly all surveyed (96 percent) said their business has Internet access. Broadband access through high-speed T-1 connections (29 percent), DSL (29 percent) and cable modems (22 percent) outpaced dial-up connectivity (14 percent) and access through other means (3 percent).

"These results demonstrate that business leaders understand the importance of the Internet, websites and online marketing tools and are acting on that knowledge," said Jeffrey M. Stibel, CEO of Interland. "Since first introducing the Interland Small and Medium-sized Business Barometer in 2003, we have seen significant growth of businesses using online tools and offerings to attract, service and satisfy customers."

The Barometer also reveals that websites are becoming more central to their underlying businesses. 53 percent of small businesses with websites say their sites are primarily to provide company credibility, and 29 percent say their site provides a critical building block for developing the products and services they sell. When asked how website success is evaluated, 54 percent say through customer and prospect comments; 48 percent say site activity, traffic and number of visitors; 36 percent cite sales leads; 24 percent say online sales; and 21 percent say efficiencies of internal processes such as faster payment processing or fewer phone calls.

Businesses appear to be spending more time updating their websites than in previous years. In fact, 52 percent of small businesses say they update their sites once a month or more, up from only 37 percent in the fall of 2003. Business service providers, retailers and non-profit organizations updated their sites far more frequently than manufacturers and personal service businesses. Overall trends show that once a business has had a website for more than one year, the frequency with which it updates its site increases over time.

When asked to define the role of marketing in their company, 49 percent of all small-business leaders said it was used to generate sales, 38 percent said to build credibility or brand awareness, 33 percent selected to generate leads and 29 percent said they don't market their company. When examining how those with a website and those without a website responded to this question, 52 percent of those without a website said they "don't market their company" while only 19 percent of those with a website selected this answer.

Views on Vacation and Business Travel

The group was also polled on their vacation plans for 2005. A quarter of respondents said they were planning to take a month or more of vacation this year; however, 17 percent said they planned to take no time off or less than a week. Only 30 percent of small-business leaders surveyed said they "totally disconnect" when on vacation. The majority (49 percent) admit to "checking in from time to time," 15 percent "check in daily" and 6 percent say they are in "constant contact with the office."

While away on vacation, the communications tool of choice for small-business leaders to bring with them is the wireless phone - 89 percent. Laptops came in second, with 42 percent bringing a portable PC on vacation, 12 percent tote a PDA, 3 percent carry Blackberries and 3 percent admit to packing overnight shipping supplies along with their suntan lotion and sunglasses.

Small-business leaders were also queried about how they are most likely to go about making business travel plans. Sixty-seven percent say they opt for the Net over the human touch. Small businesses prefer to book business travel needs online directly from service providers (35 percent) or from a full-service travel site (32 percent) rather than working with a travel agent (18 percent) or calling the travel providers directly (15 percent).

Small Business Surfing and Computing

Surprisingly, despite today's ongoing battle with computer viruses, worms and spam, 42 percent of small businesses say they have experienced no computer-performance issues over the past year. Slightly more (44 percent) say their computers have slowed down, and 30 percent report instances of freezing or crashing that require the computer to be shut down or restarted.

One possible reason why these numbers are lower than one might expect could be that a whopping 97 percent of those businesses surveyed say they have virus software installed on office computers, and 70 percent say they update that software weekly. Nearly as impressive, 80 percent use software that searches for, destroys and prevents spyware and adware from being downloaded from the Internet onto business computers - something that 62 percent say has happened to them in that last 12 months. Additionally, 70 percent say they back up their computer files at least weekly - 34 percent back up business files daily.

About The Summer 2005 Interland Small and Medium-sized Business Barometer

A total of 780 leaders of small and medium-sized businesses participated in a nationwide online survey of organizations with 500 or fewer employees. Company size ranged from less than $250,000 in annual revenue to more than $5 million, and 81 percent had been in business for five years or more. Seventy-two percent of respondents said they had a business website. Industry breakouts were as follows: 33 percent business services; 20 percent personal services; 19 percent retail; 17 percent non-profit; and 11 percent manufacturing. The margin of error for the survey is plus or minus 4 percent.

About Interland

Interland, Inc. (Nasdaq:INLD) is a provider of websites and online services focused on helping small and medium-sized businesses by providing knowledge, services and tools to build, manage and promote businesses online.