SEO, Clutch Report

Small Business SEO and Paid Online Advertising in 2016: A Survey

February 24, 2016

by Sarah Anyan

Product Manager

In what ways does search engine optimization (SEO) and paid online advertising factor into a small business’ digital marketing strategy?

Increasingly seen as a requisite endeavor for businesses of all sizes, digital marketing promotes growth by getting products, services, and content in front of potential customers. Digital marketing encompasses multiple channels. In particular, SEO and paid advertising increase a business’ visibility and reputation online.

Clutch surveyed 352 owners and managers of small businesses in the US to determine how they use two core digital marketing channels: SEO and paid online advertising. The majority of survey respondents are businesses with 1-10 employees and less than $1 million in annual revenue, which matches the makeup of the 2013 US Census Bureau data on small businesses.


No SEO Engagement for Half of Small Businesses With A Website

Before engaging in SEO, small businesses must have a website. Overall, 54 percent of respondents indicated that their small business has a website.

Evaluating the SEO habits of small businesses that maintain a company website required comparing the 189 respondents who indicated that they have a website, with their responses to the question, “Does your company actively engage in SEO to support its online presence?

Of this small subset, only half engage in SEO.

Small businesses that have a website but do not do SEO - Clutch's Small Business Survey 2016

This low engagement in SEO means that many small businesses leave the task of being found online to chance.

“Having a website but not doing SEO is like getting into the passenger seat of a car that’s being driven by a robot. Chances are, it’s going to end well, but there’s also a chance that the trip won’t work out the way you planned.”
Duane Forrester, Vice President of Organic Search Operations, Bruce Clay, Inc.

SEO allows small businesses to take control of how search engines, potential customers, and existing customers perceive their products and services. Small businesses that neglect SEO forgo these benefits.

“Small businesses that have a web presence but do not do SEO are missing a big opportunity. To grow, they really need to take the first step of creating a website and then the second step of building an effective SEO strategy.”
Matthew Goulart, Founder, Ignite Digital

For example, a company that shows up high on a page in Google in response to a search query appears more authoritative.

“Organically showing up high on a page in Google demonstrates authority because it means your business is an answer to a question, not just an ad. People go to Google to get answers to questions, and they strive to be the best answers to these questions.”
Garrett Mehrguth, President and CEO, Directive Consulting

Small Businesses Plan To Dedicate More Resources To SEO In Future

Despite the low level of SEO engagement at the time of the survey, small business awareness of and commitment to SEO has a bright future. While only 30 percent of all respondents indicated that they currently implement SEO strategies, by 2017, 60 percent of small businesses plan to practice this digital marketing strategy.

SEO adoption trends - small businesses - Clutch's Small Business Survey 2016

Small businesses in the initial stages of planning an SEO strategy should heed three pieces of advice.

1.) Educate yourself about the basic SEO strategies and concepts.

“General knowledge of SEO will help you judge SEO contractors better and ensure more effective SEO tactics.”
Igor Shvydkoy, Marketing and Business Development Consultant, Promodo

2.) Work with a reliable, trustworthy SEO agency.

“Small businesses should ask SEO candidates thoughtful questions. For example, ‘Can you guarantee positive results?’ No SEO person can answer that question truthfully because they don’t know what Google is thinking. So, if an SEO persons claims they can guarantee results, you instantly know they are lying, and you should get rid of them. The trust factor is really important with an SEO agency. Don’t be afraid to ask hard questions.”
Matthew Goulart

3.) Budget enough resources to sustain a long-term SEO strategy.

“For people looking to do SEO, you pay for what you get. … There are no shortcuts with SEO and the return on investment [ROI] often is not instantaneous.”
Garrett Mehrguth

Focus Is On Local Search, Onsite Optimization, Not Content Creation

The SEO tactics small businesses employ most frequently are onsite optimization and local search optimization (57%).

Small business SEO tactics - Clutch's Small Business Survey 2016

Industry leaders agreed that onsite optimization is a crucial SEO strategy.

“Website usability is incredibly important for SEO. If people come to your website, and they have a hard time finding something, it’s a problem, and the search engine will notice.”
Duane Forrester

Overall, effective SEO requires a balanced, comprehensive approach.

“An integrated, multi-channel approach to SEO emphasizes the importance of building your brand’s presence online, rather than just striving for higher rankings for particular keywords.”
Igor Shvydkoy

“Small businesses typically will look for the easiest approach to SEO, which is on-page optimization. But, in reality, the majority of a business’ effort should be allocated to off-page SEO tactics, like guest posting and creating content to get links. Off-page SEO is where a business builds authority.”
Matthew Goulart

Three ways of diversifying SEO strategies stand out.

1.) Content Creation

Agency leaders emphasized the importance of creating quality content that earns links, a tactic only 25 percent of businesses use.

“I wish creating quality content had a higher percentage, but it’s very difficult, so I understand. … But, in reality, content feeds all other digital marketing channels.”
Garrett Mehrguth

Content enables a business to answer a potential customer’s questions, either through the content itself or through links to other relevant sources. This ability to provide helpful information fosters trust and signals that the business can anticipate a customer’s needs.

“Content is a means of educating customers so that they feel something for the company. Then, later on, if the potential customer needs something, they will go to the company that built their trust in the first place by providing useful resources.”
Garrett Mehrguth

2.) Guest Blogging on Reputable, Topic-specific Websites

Guest blogging on relevant websites with a high domain authority is another useful SEO strategy; yet only 24 percent of small businesses guest blog to improve SEO.

“Small businesses typically address on-page SEO first because it is easier, but it should be the other way around. 20 percent of SEO efforts should be allocated to on-page optimization and 80 percent should be allocated to off-page tactics, like guest posting and creating content to earn links. This is how a business increases its authority.”
Matthew Goulart

3.) Positive Attributions

Non-linked attributions also enhance SEO by fostering a positive association with the company.

“If we have a conversation, and I say something positive about a local restaurant, I’m not really endorsing it, just mentioning it as an option. I wouldn’t mind you going there. I don’t really care if you go. I’m not really trying to sell you on going. If I wanted to sell you on going, I would say, ‘I’m taking you to lunch at the Pub.’ Then I would take you there and make you have that experience. That’s the equivalent of a direct link from the blog. But, a lot of times, this doesn’t happen. A ‘check this out’ is more common, and this will start to have value as times move forward online.”
Duane Forrester

Best SEO Metrics To Track Depend On Business Goals

Gauging the effectiveness of SEO strategies requires tracking certain metrics. What metrics are most important to small businesses?

Metrics small businesses use to track effectiveness of SEO strategy - Clutch's Small Business Survey 2016

64 percent of small businesses measure the success of their SEO strategies by tracking website traffic from search engines. Other frequently used SEO metrics include tracking search engine keyword rankings (45%) and conversions and leads (45%).

“Overall, the SEO metrics tracked depend on the company’s goals. The top metrics listed are basic ones, which is great. But, I wish all the companies tracked conversions and leads.”
Garrett Mehrguth

Despite the popularity of tracking keyword rankings, industry leaders pointed out that this metric has lost its relevancy.

“Rankings have less of an impact and are difficult to track. I think they are good for seeing progress, but they are not indicative of success.”
Garrett Mehrguth

Industry leaders highlighted the importance of tracking metrics that relay information about the ROI of SEO, such as conversions and leads. However, it is important to remember that multiple factors influence the effectiveness of SEO lead generation, such as web design and user experience.

“Conversions are influenced by onsite factors, such as website look and feel and page load speed.”
Igor Shvydkoy

“The search engines don’t want to send people to a poor experience. That would impact the search engine’s reputation negatively. … Small businesses can prevent this from occurring by creating excellent experiences for website users.”
Duane Forrester

Majority of Small Businesses Stay In-house For SEO

64 percent of small businesses rely on in-house knowledge and resources for SEO.

Internal versus external SEO resources for small businesses - Clutch's Small Business Survey 2016

The main benefit of hiring an SEO agency is the level of experience its consultants bring to the task.

“SEO agencies work with many different types of companies across many different industries. Through these experiences, they generate knowledge that can help a business.”
Matthew Goulart

Working with an SEO agency can lower the learning curve for small businesses, as long as they make an effort to guarantee the transfer of knowledge.

“Practice is the best source of knowledge. You can hire an SEO provider that will not only provide you SEO services but also educate you. Find an SEO agency with a transparent workflow so that you can see what they do and how they do it. Then, you can learn from them.”
Igor Shvydkoy

However, the process of selecting the right SEO agency remains unclear for many businesses. SEO experts advise businesses to focus on four factors: focus areas of expertise, past performance, company attributes, and value, according to a Clutch study about how to select an SEO company. Also, using an SEO Company Evaluation Tool can help businesses find an SEO service provider that meets their needs.

Breaking the data down by company size – 10 employees or less compared to 11 to 500 employees – reveals that mid-sized businesses are more likely to hire an external agency to help with SEO. 20 percent of businesses with 11 to 500 employees work with an SEO agency, compared to only 7 percent for businesses with 10 employees or less.

SEO resources used based on business size - Clutch's Small Business Survey 2016

Cost is the main factor that influences whether a small business works with an SEO agency or solely relies on in-house resources.

“To be effective at SEO, you need to invest in your strategy, and as a small business, every dollar makes a big difference.”
Matthew Goulart

For the small businesses that choose to rely on in-house SEO resources, Matthew Goulart advises creating a strong foundation before engaging in off-site activities.

SEO Foundation Checklist

  • Effective website
  • Proper calls to action
  • Features that contribute to a high probability of converting visitors to customers
  • Responsive online user experience, meaning page load times under three seconds

Small Businesses Show Low Participation in Paid Online Advertising

Other methods also exist to put a small business’ website at the top of the search engine page.

Engaging in paid online advertising – which takes many forms, including pay-per-click (PPC), display, email, and social media advertising – is one means of diversifying website traffic channels.

Only 26 percent of small businesses use paid online advertising as a digital marketing strategy. However, online advertising is on small businesses’ radar. By 2017, 54 percent of small businesses plan to implement an online advertising strategy.

Small business engagement in online advertising - Clutch's Small Business Survey 2016Adoption trends in online advertising for small businesses - Clutch's Small Business Survey 2016

David Szetela, vice president of search marketing operations at Bruce Clay, Inc., expressed surprise at the low level of engagement in online advertising.

“During the past two years, online advertising has become the main way for consumers to find the goods and services that they need. I hope small businesses wake up to the fact that if they want to reach their customers, traditional marketing activities are insufficient.”
David Szetela

Online advertising benefits small businesses by enabling growth.

“If you’re trying to grow, it’s important that people can find you. Advertising is another way to be found.”
Garret Mehrguth

On the other hand, the low participation in paid online advertising makes sense when considering the costs associated with this digital marketing channel.

“With PPC advertising, the cost-per-click for certain keywords usually falls between $5 and $10 but often is more. This cost-per-click factor is one reason why small businesses find organic SEO appealing. They can get the same conversion rate but do not have to pay for the initial click.”
Garrett Mehrguth

What rules guide the frequency of advertising online in the small business market? Of the small businesses that engage in online advertising, nearly half, 49 percent, advertise consistently.

Frequency of online advertising by small businesses - Clutch's Small Business Survey 2016

Advertising consistently improves a business’ chance of making a lasting impression on a potential customer.

“It’s very important to be consistent. People don’t just buy what they see in ads. They have to see it multiple times before they’re ready to make a purchase.”
Garrett Mehrguth

However, as with SEO, the type and frequency of online advertising depends on a business’ goals, budget, and advertising channel of choice.

“The frequency of online advertising depends on the kind of business. Almost all businesses have some degree of seasonality that affects whether they engage in online advertising.”
David Szetela

About the Survey

The study consisted of 352 owners or managers of small and medium businesses in the US.

The majority of businesses, 73 percent have 1-10 employees and less than $1 million in annual revenue. According to the 2013 Census Bureau Statistics of US Businesses, nearly 80 percent of small businesses are composed of fewer than 10 employees, which matches our survey sample. The remaining businesses, 26 percent, have between 11 and 500 employees.

The survey was conducted throughout January 2016.

Company size - Clutch's Small Business Survey 2016

Company revenue - Clutch's Small Business Survey 2016

Published February 24, 2016

To request additional information or provide feedback on this survey, contact [email protected]

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