Every year at this time, I get out my crystal ball and try to predict the future — the future of small business, that is. While no one can accurately foresee what will happen in 2014, there are some clear trends in the small business market. Here is my take on the top 10 small business trends for 2014.
While there are signs the traditional lending market is getting better for small businesses, access to credit will remain tight. That’s particularly true for start-ups. Therefore, we’ll see a significant increase in the use of crowdfuning. According to the Crowdfunding Industry Report from MassSolution, crowdfunding campaigns raised about $2.7 billion last year and are expected to double in 2014. Just as small businesses realize they can’t be all things to all people, crowdfunding is following suit. Niche sites are springing up, targeting vertical markets.
2. Mobile commerce:
It will be increasingly difficult for small businesses to compete effectively if they ignore mobile technology. The statistics from this past holiday season illustrate the growing importance of m-commerce. CNBC reported the top 20 retailers experienced an increase of 55.4 percent in the number of online sales via mobile devices this holiday season. Forty-five percent of smartphone users and 69 percent of tablet users made online holiday purchases, according to information released by Deloitte LLP. Small business customers will expect mobile access during the coming year.
3. Outsourced virtual workforce:
By the year 2015, 1.3 billion people will work virtually. Small business owners who are worried about the economy and the effects of healthcare will expand their use of virtual employees. The model will favor “pay as you go, for what you need” with a broader reach of available talent.
4. Cloud-based business solutions:
Initially concerned about security and not completely understanding what cloud computing is, small businesses are now ready take advantage of cloud-based solutions. SMB Group research shows that the use of cloud by small- and mid-sized businesses will grow from 33 percent to 44 percent over the coming year. Because cloud-based solutions are priced on usage, small businesses can access more technology resources without breaking the bank — helping them compete more effectively and enhance their bottom line.
5. Social media.
The average digital media usage among U.S. consumers is estimated at nearly 15 hours per week, according to researcher PQ Media. So even those small businesses that have been social media hold-outs will be jumping on the bandwagon in 2014 to engage their customers. Rather than a stand-alone strategy, social media will become an integrated part of their marketing strategies. As we’ve seen major brands incorporate social media into traditional marketing campaigns, small businesses will follow suit.
6. Local collaboration alliances.
Local communities will begin to collaborate more to reach a broader base of potential business. Whether it’s two local businesses cross-promoting or an entire business district, the affect of collaborative outreach is significant because it’s targeted and relevant. A survey from Constant Contact found that communities want to support local businesses. When asked if they think being locally owned and operated is a major reason why customers support their business today, 51 percent of respondents said yes. That number is up from the 42 percent five years ago.
7. Customer service.
We’ll see small firms place an even stronger emphasis on providing highly personalized service in 2014. Additionally, the public nature of customer complaints on review sites and via social media — which has doubled from 19 to 35 percent since 2011 — will make small businesses more cognizant of the need to ensure satisfied customers.
Small and medium-sized businesses simply can’t afford to disregard security going forward. The 2013 Cost of Cyber Crime Study estimated the economic impact of cybercrime escalated by 78 percent this year, and the time necessary to resolve problems after an incident occurs has increased by 130 percent in the past four years.
9. Disaster preparedness.
Too many small businesses had to close their doors for good after recent disasters. As a result, small businesses are waking up to the necessity of contingency planning. While you can’t predict when a disaster will hit, you can minimize its effect with proper advance planning. Free online resources now make it simpler for small businesses to create a disaster plan.
10. Fewer brick & mortar locations.
An estimated 16 million Americans currently work from home — a figure that’s expected to increase by 63 percent over the next five years, according to statistics from Global Workplace Analytics. Technology lessens the need for small business teams to work from one location. Social collaboration platforms allow employees to work from anywhere at anytime, seamlessly. Remote work and collaboration allow small businesses to offer flexible work schedules, which appeals to the 81 percent of millennials who expect to have a flexible work schedule.
This is what I see in my crystal ball. What do you see in store for your small business? If you have any comments about these predictions, please share them with me in comments.
Here’s to a prosperous and exciting New Year!
Susan Wilson Solovic is an award-winning entrepreneur and journalist, author of three best-selling books, multi-media personality and contributor to ABC News and other outlets, public speaker and attorney. AT&T has sponsored this blog post.