The SMB space is the biggest puzzle that the online world has been trying to solve and, with just a few exceptions, it has failed miserably to this point. We could sit and wonder why this is the case, with all kinds of neat theories and thoughts on models and processes and all other things that wreak of the Internet space. I can save all of you a lot of time and effort with the answer to the problem: people.
Yup, it’s that simple. At this point in time, the Internet industry has run up against its automated limitations when it comes to the SMB space. While the great minds of Silicon Valley run around with their “holier than thou” attitudes about building a better mousetrap through technology, they are missing the point and missing it badly. The point is that, at this moment in history, it is still critical to use people as the main conduit to sell anything to the small business owner.
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People who claim to be much smarter than me will scoff at this idea, but, as they do, they will continue to waste money ehile failing to reach the SMB en masse. I say, “Scoff away!” Where are the huge SMB successes that have no large flesh and blood sales effort? Groupon and ReachLocal are two big success stories in the SMB space. They both have large direct sales forces that talk to human beings about their business. That’s why they are successful.
What doesn’t work? The “if we build it they will come” approach to the SMB. For instance, a site that was designed to reach the Washington DC local market, TBD, has just scaled back operations. Why? A recent article from paidcontent.org shows just what happens when you ignore the human element in the SMB or hyperlocal market:
“The main problem, apart from execution, was that local online advertising has remained untapped for a reason: small businesses are still not used to buying ads on anything but Yellow Pages. They need ad sales executives to provide the necessary hand-holding to pry those dollars away. An operation like TBD, which had initially hoped that its blog network would help provide the necessary outreach and venue to local advertisers, couldn’t provide enough support.”
Talking to SMBs is critical in gaining their trust. Why do you think the Yellow Pages have been able to hold on to many of these people even when the book’s effectiveness has been questioned for years? It’s the sales team.
Now, the ugly side of that is that a good salesperson can sway a business owner to make a bad decision as well. Interestingly enough though, many SMBs may not get involved in any real marketing efforts if they weren’t led to water by a sales pitch.
Earlier this week, an interview with Google’s Chief Business Officer Nikesh Arora was intriguing to watch because while the interviewer tried to get him to talk about the need for more human interaction in selling he was hesitant to play along. While there was an admission that human interaction was important in any selling situation (this particular part of the discussion was around display ads), there is a sense that Google still wants to make the self-serve way the right way. I think they are dead wrong. Check out the exchange in this video at about the 9:22 mark. Caution: there is an ad in here from our source for the video, Clip Syndicate.
Arora’s hesitancy to commit to the need of sales people to sell any ads is curious to me and it shows that Google’s mindset is focused on the scale they think they can attain through more automation. I am not a billion-dollar research company or a PhD—rather I am someone who deals with SMBs a lot—and I can tell you from my experience that most SMBs will not buy unless they are being helped by a person and not an online prompt.
The key to success in the SMB space for the foreseeable future will be human interaction. Will it always be this way? I say yes, but there may be a lessening degree on the human side when the current generations who have grown up in the Internet age get older and replace the current group (which I am a part of) that had to learn this who thing from scratch and adapt accordingly.
Old habits do die hard. While the younger generation will be more tech savvy and maybe more willing to go the self-serve route, I don’t think it will ever replace human contact. After all, humans have been communicating directly with each other to get things done for thousands of years. If old habits do indeed die hard, then there is no habit that is much older, is there?
What are your thoughts on Google’s push to automate as much as it possibly can? Does the quest for scale trump the quest for good business practice and giving people what they really want?
