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HubShout's 2017 Marketing Trends Survey Examines Hottest SEO and Outsourcing Developments, Year's Biggest Stats

touch screen ,touch- tablet in handsFor the third consecutive year, HubShout conducted a survey of small to mid-size digital marketing agencies in order to help SEO professionals and digital marketers forecast 2017 online marketing trends.

There’s no shortage of data about large corporations’ digital marketing investments, but few small to mid-size agencies land the million and billion-dollar clients. We designed this study to collect data that is more useful to agencies whose clients have more limited budgets.

In this report, we will present online marketing data for 2017 and compare it to data from our 2016 survey. For quick reference, we have summarized the top 2017 marketing trends in the first section. Charts that show year-to-year comparisons follow.

Top 2017 Online Marketing Trends Stats:

  • 50% of small business clients spent between $501 and $2,500 per month for digital marketing in 2016 • 36% spent more than $2,500 • 10% spent more than $10,000.
  • 30% of online marketing spend went to SEO • 23% went to website development • 26% went to PPC.
  • 63% of agencies expect their clients’ marketing budgets to increase in 2017 • 14% expect a significant increase • 34% expect no change.
  • 37% of agencies believe that small businesses don’t spend more on digital marketing because they don’t understand it • 26% said because they can’t afford to spend more • 15% said because they got ripped off by a digital marketing provider and and don’t trust the industry.
  • 68% of agencies outsourced SEO to a white label SEO provider • 48% outsourced PPC services • 28% outsourced content marketing services.
  • 32% of agencies report that SEO is the service that generates the most revenue for them • 32% said that website development generates the most revenue •12% said PPC.
  • 36% of agencies predict that SEO will be the most in demand service in 2017 •16% said Website Development • 15% said Content Marketing • 15% said Social Media • 11% said PPC.
  • 98% of agencies report that they advise their clients that a mobile-friendly website is essential for an effective SEO campaign.
  • 50% of agencies report that 100% of their clients have a mobile-friendly websites.
  • 41% of agencies report that 100% of their clients have clear call to action on their mobile sites.
  • The biggest challenge for agencies in 2017: Lead Generation
  • 52% of agencies expect that referral/word of mouth will be their #1 source for leads in 2017 • #2: SEO at 14% • #3: Email Marketing at 13% • #4: Cold Calling at 11%

1. Agency Revenue / Agency Size

To help agencies benchmark where they stand compared to other small / mid-size agencies that took our survey, we begin with agency size and revenue.

48% of survey respondents reported revenue of $250,000 or less. 23% fell in the $250,001 – $500,000 range.

59% of agencies had five employees or less; 16% of that segment were one person shops.

2. Spend Trend

Compare the 2014 and 2015 online marketing stats to the 2016 spend data and you will see a consistent pattern — small-medium size businesses are increasing their digital marketing spend. In 2014, 35% of businesses invested $500 or less per month. In 2015 that dropped to 20%. Now, only 14% are at that level.

3. SEO at the Top

In 2016, as in past years, small businesses invested most heavily in SEO, Website Development and PPC. For the first time, our survey respondents reported that SEO beat out website development in terms of budget allocation.

4. Most Say Clients’ Budgets are Going Up

63% predict that their clients’ marketing budgets will increase in 2017. 34% expect no change. Only about 4% expect budgets to decrease.

5. What’s In Demand this Year?

The agencies that we surveyed predict that SEO will be the most in demand service in 2017.

6. Outsourcing Trends

SEO continues to be the service that most agencies outsource to a white label SEO firm. In 2015, 67% said they outsourced SEO and in 2016, 68% outsourced SEO. PPC has moved up to position two and content marketing to position three.

In years past, about 50% of agencies reported that they outsourced website development. In 2016, only 24% outsourced website development.

7. Why the Drop in Website Development Outsourcing?

Perhaps more agencies have set up an in-house web design and development team because the trends show that businesses are confidently investing in website development. And compared to SEO, websites are much easier to sell and to deliver! Though SEO is expected to be the most in demand service in 2017, for smaller agencies, it makes sense to outsource because there are so many components to manage and one of those components is Google and all of its rules, ranking factors and algo updates.

For the past two years, about 80% of businesses spent more than $1,501 on their websites and about 37% spent more than $4,001. Note the jump in the percentage of businesses investing more than $10,000 on their websites.

8. Can’t Spend More? Or Won’t Spend More?

Not all businesses invest in digital marketing. And those that do may not be spending as much as they could or should. We asked the agencies to offer their opinions why some businesses don’t spend more on digital marketing.

*Most who selected “other” cited a combination of factors, essentially, Either they cant afford it, don’t understand, have been ripped off or a combination of all of them.

One agency owner commented, and we think most SEOs would agree: “They THINK they can’t afford it (mainly because they really don’t understand)…until a slick agency comes along with a big sales pitch who convinces them but often does not deliver the value my agency can give.”

9. The Most Revenue

This year, we asked agencies which digital marketing service generates the most revenue for them. SEO and Website Development tied at exactly 31.6% each. PPC was next in line at 12.3%, followed by Content Marketing at 10.5%. Social Media and Email Marketing were low on the revenue generation scale.

*Other services mentioned: Mobile banner ads, Reputation Management, Brand Development and Direct Mail

10. Challenges

Getting leads is still the biggest challenge for digital marketing agencies. That has been consistent for the last three years. What’s new this time around: Concern about competitors.

11. #1 Source for Leads

For three years running, agencies have cited Lead Generation as their greatest challenge. This year, we asked our survey respondents to tell us what they expect will be their #1 source of leads in 2017.

At 52%, Referral/Word of Mouth is by far the the most anticipated source of leads.

Referrals come from setting clear expectations, making promises that you can keep, delivering on those promises and asking happy clients to recommend you to others and to write online customer reviews.

12. Catching On to Mobile

Because Mobile is so important, especially for local search, and Google is experimenting with Mobil-First indexing, we asked a series of questions related to mobile search.

We asked “What percentage of your clients have mobile-friendly websites with phone number, location and business hours prominently displayed for mobile users?” and “What percentage have a clear call-to-action on their MOBILE sites?”

To the question “Are YOUR CLIENTS aware that Google is experimenting with mobile-first indexing and will primarily look at the mobile version of a website for its ranking signals?” slightly more than half said yes.

98% of agencies are advising their clients that a mobile-friendly website is essential for an effective SEO campaign. Those who said “no” are from agencies that do not provide SEO.

This post originally appeared on HubShout’s blog; reprinted with permission.

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