aaaaaaaaaaaaa

1. T H E B A S E K I T S M A L L B U S I N E S S R E P O R T:
HOW UK SMALL BUSINESSES ARE GRAPPLING WITH NEW TECHNOLOGY
M AY 2 0 1 2

2. Content
1
Foreword
2
Small Businesses Failing To Impress Online
3
Facebook Now Top Source For New Business
4
Enterprises Crashing Out Rather Than Cashing In Online
5
Small Businesses Falling Behind On Mobile Custom
6
Methodology and Sources

3. Foreword
Here at BaseKit, we believe even the
smallest business needs to be online
which is why we try and make it as easy
as possible for every new start-up and
small enterprise to create an effective
online presence.
Somewhat surprisingly however there
are still 60% of UK small businesses
that have yet to get online despite the
Internet being an all pervasive presence
in our lives. And, the businesses that
do have an online presence sometimes
struggle to keep pace with, yet alone
embrace the possibilities that the web
can offer them.
Perhaps it’s not so remarkable when
you put yourself in the shoes of a small
business for a moment. It’s not easy out
there. The pace at which technology
is changing is just extraordinary and
consumer’s expectations of what they
want a website to do, or not do, has
changed with it – along with the devices
they use to access the internet.
We spoke to just over 500 small
business owners, from one-man bands
up to small partnerships, to find out
just how well they are faring with the
technological advances and whether
they are harnessing them to their
full advantage.
This report outlines the key findings
from speaking to a cross section of
businesses, which between them, form
the backbone of the UK economy. It
looks at how firms are embracing social
media to market themselves through
to the impact poor web hosting – and
subsequent website crashes - can have
on their bottom line.
One trend that emerges strongly is a fear
amongst small businesses that, if they
don’t harness the web more effectively,
they are in danger of becoming “digital
dinosaurs.”
We have used these insights and the
findings to help us establish The BaseKit
Learning Centre - an online academy
for small businesses to find out all they
need to know about running and growing
their business online. We’ve created
a series of online guides written by
professionals to help firms get the most
from the internet from SEO optimisation
through to social media and online
marketing.
We hope you enjoy reading the report.
Simon Best
Simon Best
Founder, Basekit
Digital Dinosaurs 1

4. Small Businesses
Failing To
Impress Online
They say you never get a second chance
to make a first impression and it’s a phrase
that rings true for hundreds of thousands
of small businesses nationwide, according
to our research.
Despite being the equivalent to a “shop
window”, just one in six small businesses
(16%) believes they have a website they
can be very proud about.
One in ten small business owners
(11%) say their websites use out of date
technology and a further 11% describe
their company’s online presence as either
“poor” or “embarrassing,” according to our
figures.
“Three quarter of the small
businesses we spoke
to admit having a welldesigned and functioning
site is important for their
reputation - as well as critical
to drumming-up new leads.
Yet they are really struggling
to know how to keep up with
the latest developments and
are scared of becoming socalled Digital Dinosaurs.”
Simon Best
A quarter of small businesses (25%) say
they are envious of their competitor’s The ways that small businesses currently
websites as they struggle to keep pace describe their website:
with technology change and maintain a
site that is customer-friendly.
Keeping up with changing technology
is a real issue for half of the small
businesses we polled as they admit to
grappling with ecommerce functionality,
mobile friendliness and search-engine
optimisation. Only a quarter of businesses
(25%) are able to process transactions
online currently and only 9% have a site
that is compatible with mobile phones or
tablets.
The changes that businesses would like to
make include better design and cheaper
hosting as well as better analytics and the
opportunity to change and refresh content
themselves.
64% It’s “adequate”
23% It’s up to date
11% It’s out of date
11% It’s poor and embarrassing
5% It’s perfect
Small businesses are in danger of seriously
lagging behind when it comes to their web
functionality:
Changes functionality
%
Able to update their own sites
67%
Online payments accepted
25%
It can host a blog
22%
It can host video
22%
Integration with social media
19%
SEO optimised
18%
Process online bookings
18%
Optimised for mobile devices
9%
No additional functionality
18%
“For many small enterprises,
their website is their window
to the world, yet so many
feel poorly served by
what they’ve created for
themselves online.”
Simon Best
The aspects business’s would change
about their website:
32% Better design
17% Ability to change content oneself
16% Cheaper hosting
14% Better analytics
7% Better technical support
2 Digital Dinosaurs

5. Facebook Now Top
Source Of New Customers
For Small Businesses
Over one third of UK small businesses
say that they now use Facebook to drum
up new customers – more than local
directories such as Yellow Pages and
Thomson and substantially more than
print or online advertising.
We found that 36% of small businesses
in Britain use the social network to market
themselves, where just a quarter say they
rely on local directories (27%) as a source
of new customers.
Twitter has also become popular with
small businesses and their owners – over
one-in-six (17%) use the site to scout
for new customers and to market their
services and the micro-blogging site is fast
catching up with those who say they use
print (21%) or online (20%) advertising for
their marketing.
Our research also found that, while vast
numbers of the UK’s 1.1 million small
businesses are online and are using sites
such as Facebook successfully, there
are still 660,000 that have yet to get
themselves online at all. This is despite
the fact that three quarters (74%) of those
that do have a site say it has become
critical to drumming-up new leads and to
their reputation as a company.
The research shows that while a lot of
small businesses are forward-thinking
when it comes to the web, there are a lot
of others that have yet to get on board.
“Small businesses are
shifting their marketing
to lower-cost media like
Facebook and Twitter and
away from legacy media like
the directories. They tell us
that one-to-one marketing is
their most efficient and most
successful way of generating
new business – the fact
that Facebook has become
the number one source of
new business within just a
few years of its creation is
remarkable.”
Simon Best
Channels that businesses use to market
their business
36% Facebook
27% Local business directories
21% Print advertising
20% Online advertising
17% Twitter
14% Trade publications
“The simple truth is that,
for a small business with
customers who may be
under 40, if you’re not on
the web then you are moreor-less invisible. We believe
that every small business
in the UK should be able to
take advantage of the power
of the internet as a tool to
grow – and should be able to
create a professional website
cost-effectively.”
Simon Best
Digital Dinosaurs 3

6. Small Businesses
Crashing Out Rather
Than Cashing In Online
A quarter of UK small enterprises – or
nearly 290,000 individual businesses has seen their websites crash or become
inaccessible to customers due to poor
web hosting, our research shows.
Impact of website crashes on small
businesses:
One in ten small businesses impacted by
web crashes believes the unscheduled
down-time has significantly impacted their
trading.
Three quarters (74%) of small businesses
say being online is important to drumming
up new leads and to their company
reputation. Yet website crashes are
hampering business success, as is trying
to keep pace with changes in technology
and customer behaviour says the BaseKit
Small Business Report.
“Small businesses invest a
lot of time and resource in
creating their websites so
it’s understandable they get
frustrated when poor web
hosting means that their
sites crash resulting in lost
customers and revenues.”
Simon Best
4 Digital Dinosaurs
10% Crash had an impact
7% Crash didn’t impact much
6% Crash didn’t impact at all
65% Never experienced a crash
11% Can’t remember
“Start-ups and enterprise
companies aren’t always
helping themselves to make
the most of what the web has
to offer. We were surprised
by how little functionality
some websites have –
meaning companies aren’t
cashing in on the growing
ecommerce trend.”
Simon Best
Importance of a website to business
reputation:
38% Extremely important
36% Slightly important
17% Neither important or unimportant
6% Not very important
3% Not important at all

7. Small Businesses Falling
Behind As They Miss Out
On Mobile Custom
UK small businesses are missing out on
vital sales and a source of new customers
as just one-in-ten (9%) say their websites
can be used with mobile phones and
tablets in mind.
However, our research found that 45%
of internet users use a mobile device to
access the web and that 6% of internet
users have shopped online from their
mobile phone and that they are spending
up to £1.3 billion on “on the move”
purchases.
The risk is that small businesses will miss
out in the belief that creating a mobilefriendly site is too costly or too complicated.
And with reports predicting that purchases
made using smartphones could make up
12% of the value of all ecommerce, it’s an
area that smaller companies can’t afford
to miss out on.
The “Digital Dinosaurs” research found
that falling behind the pace of technology
change was something that preoccupies
small business – with half saying they are
“concerned” or “very concerned” that they
are being overtaken by changes including
the advance of mobile internet usage.
“Access to the internet is the
fastest-growing technology
trend. The number of
British consumers with
smartphones has almost
doubled in the past couple
of years and is now nearing
50%.
Simon Best
“Being online is good,
but having a site that isn’t
built with this generation of
mobile internet users in mind
means small businesses
are missing out on a major
source of new customers
and sales.”
Simon Best
Levels of concern about keeping pace
with technology change:
11% Very concerned
40% Slightly concerned
38% Neither concerned or unconcerned
10% Very unconcerned
2% Don’t know
Digital Dinosaurs 5

8. Methodology
and sources
About the research
BaseKit.com commissioned Opinium Research LLP to
conduct a research poll amongst 510 small businesses
in April 2012.
All the business owners polled ran enterprises that employed
between 1 and 49 staff.
According to latest figures (2011) from the Department
for Business, Innovation and Skills, there are 1,141,950
private enterprises with between 1-49 employees in the UK,
responsible for 7 million people and turning over
£864 million a year.
The fieldwork took place between the 20-27 April 2012 and
was conducted online. According to BaseKit Insight Data, 60%
of SMEs are yet to get online.
For more information, contact the BaseKit press office on
020 7566 9747 or email basekit@hopeandglorypr.com.
About BaseKit
BaseKit.com was founded in 2009 and our success has made
us one of Europe’s most exciting tech start-ups. We now
sign up 40,000 new paying customers every single month.
BaseKit’s technology makes it easy for small businesses to
create an effective online presence and is localised in 10
languages globally.
BaseKit offers a range of sites – all designed to be compatible
with mobile access, as well as traditional PCs – with a full
ecommerce site costing just £100 a year and a service that
enables a business to get started with a site for free. Visit
www.basekit.com to find out more.
The BaseKit Learning Centre is an online academy for small
businesses to find out all they need to know about running
and growing their business online. We’ve created a series
of online guides written by professionals to help firms get the
most from the internet from SEO optimisation through to social
media and online marketing. Visit www.basekit.com/learningcentre to find out more.
6 Digital Dinosaurs