1. The findings are published in a new guide, Smart Marketing for Small Businesses, following the launch of Royal Mail’s new online tool – MailshotMaker Opens in new window – created for SMEs that want to grow their business while retaining full control of their marketing
2. Nearly three quarters (72 per cent) of SMEs invest up to 20 per cent of their turnover on marketing. They understand the potential of multi-channel marketing and use an average of 3.5 media channels to promote their business
3. But SMEs are held back from using new marketing channels due to concerns about measuring return on investment, cost, capacity to handle customer responses and a lack of expertise
4. In addition, 68 per cent said it can be difficult to get customers to take action as a result of marketing
5. Among businesses using direct mail, 75 per cent said it delivers a good return on investment and 75 per cent also said consumers were more likely to keep hold of mail than an email 
6. MailshotMaker is an online tool which guides users through the design process, helping them to create professional, engaging mailshots which deliver results

Royal Mail MarketReach today releases new research revealing that the majority (81 per cent) of UK SMEs believe marketing is ‘critical’ or ‘essential’ to their business growth, with 37 per cent believing it is the primary driver of their business. The research demonstrates that SMEs are ambitious and focused on growth, with nearly nine out of ten (89 per cent) looking to grow their business this year.

The research findings are published in a new guide from Royal Mail MarketReach, Smart Marketing for Small Businesses which can be downloaded here: http://www.royalmail.com/business/services/marketing/self-service-tools/mailshotmaker Opens in new window, and looks at the business ambitions and marketing challenges of UK SMEs in 2016.

Marketing for growth

The research found that nearly three quarters (72 per cent) of SMEs invest up to 20 per cent of their turnover on marketing, a significant investment. This is not surprising given that two thirds (66 per cent) of SMEs said they are looking to acquire new customers and 46 per cent want to build stronger relationships with their existing customer base. This is higher than the number of SMEs currently looking to expand internationally (24 per cent) or sell through more channels, such as marketplaces (31 per cent).

SMEs embrace a multi-channel approach

SMEs also reported that they understand multi-channel marketing and apply it regularly, with an average of 3.5 media channels used in their marketing. Many are choosing to ‘do it for themselves’, with 69 per cent preferring to develop and manage all marketing in-house.

The most popular channels for SME marketing are email (82 per cent), social media (62 per cent), online advertising (50 per cent) and direct mail (46 per cent). Only 16 per cent of SMEs currently use search marketing and seven per cent use telemarketing.

Barriers to marketing

While SMEs recognise the benefits of marketing, the research also highlights barriers: 68 per cent of SMEs said it can be difficult to get customers to take action as a result of marketing activity.

Furthermore, SMEs are held back from using new channels by a range of concerns. The most commonly cited barrier to using a new marketing channel was a concern about measuring the commercial return on their investment. The second greatest barrier was the cost associated with using the new marketing channel. Capacity to handle customer responses as a result of marketing activity was third, with SMEs saying that a lack of knowledge about who to contact to set up marketing in a new channel was the fourth greatest barrier.

Direct mail offers good ROI, say SMEs

Among users of direct mail, confidence in its commercial value is strong: 75 per cent of SMEs using direct mail said it delivers a good return on their investment. Furthermore, 75 per cent of SMEs using direct mail said that consumers were more likely to keep a piece of marketing mail than an email. This could be good news for the 71 per cent of all SMEs which said they wanted to create marketing that customers can keep hold of for future reference.

The SME report is published following the launch of Royal Mail’s new online tool MailshotMaker, Opens in new windowmailshotmaker.com, which enables companies to create professional, cost-effective mailshots in minutes, with prices from just 49p per item. Royal Mail created MailshotMaker specifically for SMEs that want to grow their business and remain in control of their marketing. The online tool will guide users through the design process, helping them to create professional, engaging mailshots which deliver results for their business, whether they are reconnecting with existing customers or finding new ones.

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Source: Royal Mail Group