How small businesses can create big impact using the world’s largest social media platform.
Growing up around my mother and stepfather’s small businesses, I learned that successful entrepreneurs usually managed to get three things right: they managed their finances well, they figured out a marketing strategy that worked for them and they were able to hire the right people to help them grow. While these principles still hold true, today’s business landscape has been completely transformed by technology and the kind of connections it enables.
Simply put, there has never been a better time to have a good idea. In our connected economy, the distance between a good idea and the people it serves has never been shorter. This is fundamental to the ecosystem Facebook is building – one that reduces barriers for entrepreneurs who have great ideas and want to share them with the world.
In the late 1990s, I was part of two different e-commerce start-ups. One aimed at getting people to order groceries through the internet and the other meant to help businesses maintain their inventories. Marketing the service was one of our biggest challenges because people hadn’t yet adopted online purchasing.
Today, the opposite is true. Consumers adopt new technologies long before businesses do and this influences how they discover, research and finally make purchasing decisions. We see this every day at Facebook, where over 1.5 billion people across the world come to connect with people, products and services they care about. Globally, 90 million businesses use Pages every month; over 25 million businesses have an Instagram profile and over 200 million people visit an Instagram business profile every day.
“In our connected economy, the distance between a good idea and the people it serves has never been shorter.”
Before Facebook, if you were a small business you had two choices: spend your whole budget to run an ad on TV, in a newspaper or on a billboard, or you could rely on word of mouth. Facebook transformed this ecosystem. To understand the extent of this change, in 2017 we commissioned PricewaterhouseCoopers Consulting (Australia) Pty Ltd to explore the economic and social benefits from the use of Facebook from the perspective of SMEs in Australia. The report shows that social networking platforms have transformed the way SMEs go to market. Our free tools and paid advertising capabilities give businesses an instant mobile presence.
Facebook also increases the likelihood of a business reaching the right consumer with their products, thereby optimising marketing spend and return on investment. For example, a small business could run two separate adverts simultaneously and monitor the performance of each, ultimately phasing out the least successful. For start-ups and young businesses this is often a more appealing offering than traditional marketing methods, which require more up-front investment. Facebook ads are proven to drive business results. In fact, more than 8.2 million Australians have purchased from or visited an SME after seeing relevant content on Facebook.
PwC’s research also shows that the growth of SMEs attributable to their use of Facebook has generated significant employment and economic growth within Australia. A third of SMEs using Facebook in Australia increased their headcount in the six months to December 2017, and 38 per cent said they would increase their number of employees in the following six months. Facebook has played a role in this, connecting businesses to local, national and international markets, allowing businesses to expand their reach and enjoy the associated benefits like increased sales. In fact, 57 per cent of SMEs on Facebook hired more employees due to the growth in demand for their products and services since they first joined Facebook. And of these businesses, over 70 per cent said they have used Facebook to find suitable employees by posting job listings on their Page.
In 2017, this growth led to approximately 120,000 employees hired by SMEs, who generated $16.8 billion in additional economic value (GVA) nationwide. This has a huge impact on the Australian economy since SMEs employ more than two-thirds of all workers.
When I look at it from the lens of the two big challenges small businesses face – marketing and hiring – both are made easier by the connections that technology enables. But it can
There are two ways to approach this. The first is to understand the large-scale shifts driving commerce today, and the second is to harness the free and paid marketing tools to boost your business.
At Facebook, we see successful new businesses and brands built around these four pillars:
1.Community: People now have the power to organise and build community around the things that matter most to them. Brands need to identify, take inspiration from and participate in the communities that people inhabit.
2.Curation: People have infinite choice and total control over what they watch, read, interact with and buy. To stand out and meet the expectations of a curated world, brands must meet people where they are in the mediums that they prefer.
3.Conversation: People connect directly, immediately and expressively. Businesses that cater to this need for conversation build trust and loyalty.
4.Commerce: People have never been better informed about the products and services they choose, and so empowered around exactly how they want to buy them. That’s why it’s critical to meet people wherever they are and reimagine how we connect and empower people to buy and sell the things that matter to them.
To support SMEs and save them time and resources, we’ve built a suite of free tools that make running a business on Facebook easier. I’m highlighting five business tools that are easy to use and can help entrepreneurs focus on growth.
This suite of free and easy tools means that, as a small business, you are freed up to really focus on building strong relationships with your customers and growing your business. Using Facebook also removes many of the geographical barriers facing traditional stores.
If you are based in the regional areas of Australia, using Facebook can help you access the larger markets of the state capital cities and allow you to seek international demand for your products or services. The PwC report shows that consumers from all around the world are connecting with Australian businesses through Facebook. The latest data shows approximately 210 million people from around the world are connected on Facebook to a business of any size in Australia.
Through our tools and technologies, we want to enable Australian entrepreneurs to build the kind of businesses that thrive in a connected world.
Melinda Petrunoff, director small and medium business (Australia and New Zealand), Facebook
This story first appeared in issue 26 of the Inside Small Business quarterly magazine.