UK SMBs turn to new tech for advertising opportunities
Small businesses may have smaller budgets, but they are “very interested” in how they can utilise new technologies when it comes to advertising.
According to a new study from Amazon Ads surveying 300 UK small and medium-sized businesses (SMBs), in the next 12 months 28% said they planned to spend on streaming TV advertising.
Ludovic de Valon, director of global SMB marketing at Amazon Ads, told The Media Leader: “I do not think we should underestimate the power of self-service streaming TV and connected TV for SMBs, because it is really for the first time giving access to TV-like advertising.
“For decades, we have talked about the power of sound, sight and motion to build a brand, to convey an emotional response from the consumer — but it has always been difficult to access for SMBs with high costs and process.”
Amazon’s Sponsored TV, a self-service platform of streaming TV advertising available to sellers on its marketplace, along with other products, are “breaking down all those barriers” for SMBs to enter the streaming age.
New tech, new markets
De Valon added: “A lot of SMBs seem very interested in new technologies, in particular AI, which is somewhat new and that is a big focus for us to develop products using AI to meet the need of SMB.”
He believes AI will now “concretely help” SMBs, especially with creating campaigns and democratising access.
The study found that 45% thinks AI “will improve the performance of their advertising campaigns” and 18% are “currently training their teams” on how to use this technology for advertising purposes.
De Valon revealed that Amazon Ads’ Image Generator tool has created 20% more campaigns for SMBs, with 5% more sales “in the very early stages”.
Another “surprising” focus unveiled in the research was SMBs using advertising for expansion into other markets.
More than half of UK SMBs (54%) said they had used advertising to “expand internationally” — something that de Valon had “not necessarily seen before”.
He explained: “When you think about it, it has never been easier to expand internationally. Back in the day, it was probably unthinkable for SMB to build a relationship and network in every market where they operated. Now, with the same self-service platform, they can choose in a few clicks to expand.”
Work to do
De Valon said there was “still work to do” to get more SMBs into advertising, noting that there was “a lot of consistency across countries” as the business objectives of SMBs “tend to be universally true”, such as driving sales of a product or acquiring new customers.
SMBS that advertise on Amazon Ads generate 26% of their sales through ads, de Valon revealed, with 17% of new customers also coming through advertising.
In the UK, 71% of those sampled said they currently spend on advertising, compared with 29% that do not spend on advertising at all.
Among those that do spend on advertising, the biggest challenges were knowing where to focus budgets to achieve goals (30%), uncertainty around measuring campaign performance (26%) and creating compelling content (26%).
For those that do not advertise, they cited advertising as too expensive (42%) or they had not seen a previous return on investment.
However, 44% of UK SMBs said they increased adspend during the past year, while 35% kept their budget the same as the year before.
The most popular channels for UK SMBs to spend on advertising were social media (65%), online search (58%) and online display (40%).
These findings were part of a wider Amazon Ads study that involved 4,138 marketers at SMBs in 14 markets. It was conducted by market research company Opinium between 29 February and 20 March.