Technology Tops Small Businesses' Shopping Lists - eMarketer

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Technology Tops Small Businesses' Shopping Lists

Computers among the most-desired technology for SBOs

January 16, 2015

Before the economy began showing sustained improvement, many small businesses were hanging on for dear life rather than seeking growth. “Cash flow” felt more like a “cash trickle,” leaving them in no position to make capital expenditures they could avoid, according to a new eMarketer report, “Small Businesses as B2B Customers: Ready to Spend, but Only if Given Good Reason.”

Capital Investments that US Small-Business Owners Plan to Make, by Category, Fall 2012-Spring 2015 (% of respondents)

Those days have passed. A healthy 2014 has put revenue gains in the bank, and owners foresee further increases. The focus for small-business owners (SBOs) is shifting from survival to growth. This creates opportunity for companies that sell goods to small businesses—especially the technologies that companies of almost any sort need if they are to prosper these days.

Technology is a common denominator in small companies’ shopping lists. But SBOs will not spend on it willy-nilly, especially if unconvinced that up-to-date technology is essential to their success.

When an October 2014 survey for Manta asked SBOs to compose a wish list of holiday gifts they coveted, a “new computer” was on top—ahead of new customers or money SBOs could use for business purposes. (Polling was conducted among members of Manta’s online community of small businesses.)

In case Santa didn’t provide, 36% of SBOs surveyed by PNC Financial Services Group between July and September 2014 planned to increase outlays on technology in the following six months. Looking at capital investments in general, American Express found 57% of SBOs were planning some in the following six months. Technology was the most-cited category.

Change in Planned Spending on Business Expenses According to US Small-Business Owners, Sep 2014 (% of respondents)

Some SBOs will reduce technology spending, but they are more the exception than the rule. In a September 2014 survey by ad agency Cargo (which helps big companies sell to small companies), SBOs expecting to spend more for computer equipment were nearly twice as numerous as those planning to spend less.

While computers may seem passé to consumers in the smartphone age, they remain important for small businesses. This was evident in May 2014 polling for Microsoft by Ipsos Public Affairs. When asked what technologies “would be prioritized for upgrades if resources were available,” SBOs put laptop/desktop computers atop the list, well ahead of mobile devices (35% vs. 11%).

Get more on this topic with the full eMarketer report, “Small Businesses as B2B Customers: Ready to Spend, but Only if Given Good Reason.”

This report answers these key questions:

  • How are SBOs feeling about their finances? And does this translate to a willingness to invest for growth?
  • As SBOs look to technology to upgrade operations, what's on their shopping lists?
  • How do they feel about the marketing that vendors aim at them?
  • How sophisticated are they in using technology for their own marketing?

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