3 Trends That Reveal the Present and Future of Small Business

In 2023, 33.3 million U.S. companies — a whopping 99.9% of companies nationwide — were categorized as small businesses. If it wasn’t already abundantly clear, this stat only helps to solidify the importance of small businesses to the U.S. economy — especially as entrepreneurs continue to launch new endeavors in record-breaking numbers.

Whether you’re a small business owner, or work for, use, or shop from one, it’s vital to understand the current landscape for such companies. Taking a look at third and first party data, we found these trends that speak to the present and future states (and success) of small businesses.

Small Businesses Are Testing New Channels, With a Particular Focus on Digital

Many small businesses operate with lean marketing teams. While they may be few, their efforts are mighty; they’re constantly looking for ways to evolve marketing and advertising strategies. According to a recent study by Constant Contact, the large majority of small businesses (82%) agree that using more than one marketing channel drives stronger performance. Additionally, 41% said that they’ll increase their number of marketing channels in the next year.

Digital channels, in particular, have taken off. Per the Data Catalyst Institute, 70% of small businesses say they’ve upped their usage of digital advertising from 2022 through 2024.

Our data from the MNTN Performance TV platform supports these findings. To start, 90% of MNTN advertisers are new to TV, indicating that small businesses are indeed investing in fresh channels.

On top of this, when comparing data from Q1 2023 to Q1 of 2024, the number of small business advertisers on the MNTN platform grew by 233%, and the number of Connected TV (CTV) campaigns increased by 155% year-over-year (YoY).

Looking at 2023 alone, the number of small business advertisers who used MNTN to drive performance on CTV trended upward throughout the year. This investment in CTV paid off as MNTN’s small business customers’ ads were viewed by increasingly more customers — impressions grew steadily in 2023, with big spikes around major holidays (more on this below).

Seasonal Moments Are Especially Vital to Small Business Health

Q4 and the Winter Holidays — The Gifts That Keep Giving

You’re probably pretty familiar with how important Q4 and the winter holidays are for advertisers — we can’t imagine why, it’s not like we talk about them all the time or anything. (Oh wait…) What you might not know though, is just how important the season is to small businesses. According to Constant Contact:

• 75% of retail and ecommerce small businesses rely heavily on holiday sales to meet their annual revenue goals
• 58% of retail small businesses say that holiday customers are “extremely important” to their overall success
• 50% of small businesses get at least one-quarter of their annual revenue from holiday shoppers; for those in the retail and ecommerce spaces, that number jumps to 73%

Q4 and the winter holidays created top performance for MNTN small business advertisers, as well, with the weeks of 11/26, 12/3, and 12/3 yielding the most notable revenue spikes. Seven of the top 10 days of 2023 for generating revenue fell within the three weeks leading up to Christmas, indicating that shoppers turned to small businesses for last-minute holiday shopping.

Like their larger counterparts, small business advertisers benefitted from November’s Cyber Five (the five major shopping days from Thanksgiving to Cyber Monday). MNTN’s small business customers experienced a significant uptick in revenue across these five days, and saw a particularly powerful return on advertising spend (ROAS) on Black Friday. Despite a lot of competition around monumental shopping moments like Black Friday, small businesses can still reap the rewards of running special promotions during these times.

The Cyber Five might have delivered impressive performance, however, December was the overall standout month of 2023 for small business MNTN users. The final month of the year produced the strongest overall ROAS, revenue, and average visit rate, and was the second-best in terms of average order value (AOV) and average conversion rate.

Summer Is a Season for Acquiring Customers

Q4 and the winter holidays are pivotal for many brands, but the rest of the year shouldn’t be overlooked. For MNTN small business customers, summertime drove notable performance — July delivered the lowest overall cost per acquisition (CPA) and cost per visit (CPV) of any month in 2023.

This suggests that small businesses can capitalize on the summer months — not to mention any specific holidays or activities that consumers might be shopping for, like 4th of July, back-to-school, summer travel, outdoor activities, etc. — to acquire customers ahead of the peak Q4 shopping season.

Small Businesses Sustain Powerful Performance Throughout 2024, Setting Them Up for a Strong Q4

With the end of 2024 in sight, how small businesses close out the year depends on several factors, including a major election and continued questions of economic stability. Despite these, consumers have made it clear that they will do what they can to support their favorite small businesses, especially on a local level.

Online marketplace Faire found that shoppers are willing to spend an extra $150 per month — for a total of $2,000 in 2024 — to ensure local small businesses stay open. Consumers even will use their political vote to further drive this point home — 85% of Faire’s respondents said that a candidate’s support of small businesses will influence who they vote for in November.

Our data suggests that consumers are staying true to their word of supporting their most-loved small businesses. In 2024 thus far, MNTN’s small business advertisers have sustained strong performance — following a particularly fruitful end of 2023, Q1 2024 produced an upward trend in small business conversions.

And, after a slight dip in April, conversion rates increased for small businesses over the course of Q2 and Q3 2024.

With a strong first three quarters in the books, small businesses have set themselves up to close out 2024 with a bang.

Small Businesses + Connected TV = Year Round Performance

Seeing as nearly all companies in the U.S. can be considered small businesses, they’re essential to the country’s commerce. While their size can be limiting, small businesses have proven that they are resilient and will continue to evolve their marketing strategies in order to grow their business — especially when it comes to digital.

One digital channel that small businesses are successfully experimenting with: Connected TV. CTV’s rise has enabled small businesses — who may have never seen television advertising as an option previously — to advertise on screens far and wide. Not only is CTV allowing these companies to raise brand awareness, it’s helping to generate meaningful full-funnel performance, throughout the year, but most importantly during the vital Q4 and winter holidays.