Small Businesses Expect to Increase Technology Spending in 2008

Small businesses will increase technology spending in 2008 with a focus on PCs and communications services according to the results of a customer survey conducted by RingCentral. The survey, completed by small business owners and entrepreneurs across the U.S., reveals that email and phone (land-line, IP phone, softphone or mobile phone) are the most important technologies for conducting business, followed closely by a website (email: 81 percent; mobile phone: 77 percent; business phone: 69 percent; and, website: 61%).

The majority of survey respondents (60%) plan to increase technology spending in 2008, with only 6 percent planning to decrease spending and 31 percent planning to maintain current spending levels. Investment in personal computers tops the list (57%) followed by investment in telephony tools. More than a third of small businesses plan to invest in phone systems, smart-phones and Voice-over-Internet Protocol (VoIP) technologies. Currently, 40 percent of survey participants use VoIP technology with an additional 38 percent planning to adopt VoIP technology in 2008.

According to the survey, a significant number of small businesses used Web 2.0 technologies, such as click-to-call, blogs, social networking sites, instant messaging and text messaging, to communicate more effectively with customers in 2007. The use of these technologies is expected to increase in 2008.

Thirty-four percent of respondents currently use click-to-call technology on their websites and in their email signatures to facilitate communication with customers and an additional 41 percent plan to adopt this technology in 2008. The use of social networking sites such as LinkedIn, MySpace and Facebook is expected to increase from 38 percent in 2007 to 59 percent in 2008. Additionally, more than a quarter of small businesses surveyed will begin using instant messaging and text messaging to communicate with customers in 2008.

An additional 11 percent identified communication devices such as PDAs, mobile phones and smart-phones as the best new technology they adopted in 2007. However, many small businesses expressed skepticism about VoIP, with 14 percent identifying it as the most disappointing new business technology they tried over the past year.

“We realize that some small businesses that tried VoIP were disappointed -- a number of early industry players overpromised and under-delivered on this technology. Our approach is to let customers try-before-they buy and determine if their PC and broadband connection are VoIP ready,” said Vlad Shmunis, CEO of RingCentral. “We don't require customers to jump into VoIP with both feet -- we work just as well with landlines and mobile phones. What is clear from this survey is that as small businesses adopt new technologies, the basic desire to connect with customers and project a professional image will continue to drive their priorities.”

Staying connected over the holidays

Small businesses will be busy this holiday season, with 80 percent planning to work during the break. In fact, 31 percent estimate that they will spend more than half of their time working during the holidays. The majority, 56 percent, would even interrupt their holiday dinner to take a phone call from an important customer.

According to the survey, the phone (land-line, VoIP, softphone or mobile phone) and email are the main tools small business owners will use to stay connected with customers, partners and prospects during the holidays (email: 46 percent; mobile phone: 39 percent; land-line: 7 percent; and, VoIP: 4%).

RingCentral conducted this survey from November 27 to December 13, 2007. More than 100 RingCentral small business customers answered an online survey.

Posted to the site on 18th December 2007

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