America's Small Businesses Find Increased Success Reaching Local Customers Online

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DALLAS - More small businesses are relying on the Internet as a valuable customer service and communications tool, according to Verizon's Third Annual Small Business Internet Survey. Of the small businesses surveyed, 37 percent report having a Web site, up 6 percent from 1999.

According to the survey, small businesses are using the Internet as a proactive customer relations and marketing tool. More than half of small businesses with a Web site exchange e-mail with customers daily. In addition, 48 percent exchange e-mail with customers several times a day - a 60 percent increase over the past year, and one in five small businesses with a Web site distributes an e-mail newsletter.

"The Internet is just as critical a business lifeline for small businesses as it is for big businesses," said Patrick Marshall, group vice president - marketing, Verizon Information Services. "As small business owners realize the value in basic Internet features, they will begin to explore more in-depth applications."

Of the small businesses surveyed who report having a Web site, 66 percent say the Internet is important or extremely important to their business, rating its importance a 7 or higher on a scale of one to 10.

"Our small business clients tell us that having a Web site is growing in importance because many of their competitors and customers are online," said Donald Wilson, president and CEO of the Association of Small Business Development Centers (ASBDC), an organization dedicated to strengthening small businesses through business management education.

Online Customer Service, Communication Increasingly Important

Small businesses are increasingly establishing Web sites for advertising and communications purposes. In 2001, 36 percent of small businesses with a Web site established the site to advertise their business and provide company information compared to 9 percent who established it to sell or market products or services online. This is a continuing trend from 2000 in which 26 percent of small businesses with a Web site developed it for advertising and communications purposes rather than 13 percent who developed it for transactional functionality.

More service-oriented businesses are getting online today than any other industry segment. Companies in the financial, real estate and insurance industries have experienced a 160 percent growth rate in the number of businesses with a Web site since 1999.

Also, small businesses with a Web site rate e-mail communication the most important online feature for their business in the next 12 months. E-mail was rated an 8.0 in importance on a scale of 1 to 10.

Profits Spur Commitment to Future Internet Investments

Small businesses with Web sites are benefiting from their Web efforts. Fifty-seven percent of small businesses say their Web site has provided at least a 100 percent return on investment. In fact, the majority of small businesses with a Web site expect the amount of business generated from their site to increase. In addition, sales generated from the site, as a percent of the total sales, show a 23 percent growth in the past year.

Many small businesses are so pleased with their Web success that they are committing to further investments. More than half of small businesses with a Web site are planning site enhancements in the next 12 months. Most of these improvements consist of new marketing efforts, including 62 percent who plan changes to site design, 59 percent who plan to add more products or services to the site and 52 percent who plan to promote or increase advertising for their site.

In addition, 52 percent of those with a Web site would like to add an online lead generation service, 24 percent are interested in a scheduling application and 20 percent would like to increase their exposure to the Hispanic community with a Spanish version of their site.

"Small businesses who invest in their Internet presence - with a relevant and useful Web site, frequent communication with customers via e-mail, and new online features that make customers' lives easier - find their efforts yield profitable results," said Marshall. "Small business owners have realized that when it comes to the Internet one size doesn't fit all. We want to help small businesses find their specific recipe for Internet success."

Verizon, the Internet's #1 online directory, provides Web development and Internet advertising services for small- to medium-sized businesses, serving nearly 100,000 businesses to date.

The Small Business Internet Survey

The Small Business Internet Survey was conducted by The Gallup Organization, Inc. for Verizon Information Services. The random telephone survey of 500 companies in the United States that have 50 or fewer employees reveals interesting findings (+/- 3.5 percent statistical significance) about the relevance of the Internet and e-commerce to the country's small businesses. Interviews were conducted in July 2001.

Verizon Information Services and

Verizon Information Services is the world's leading print and online directory publisher and a content provider for communications products and services. The largest directory publisher in the world, Verizon has annual revenues of more than $4.1 billion and publishes nearly 1,600 Verizon directory titles with a total circulation of approximately 142 million copies worldwide.

Verizon Information Services produces and markets, the Internet's preeminent online directory and shopping resource. receives as many as 12 million visits and completes as many as 39 million searches per month. also powers directory services on MSN, InfoSpace, AltaVista, Excite, Ask Jeeves, Lycos, HotBot, BigFoot, Angelfire and Tripod.

Based in the Dallas area, Verizon Information Services is a unit of Verizon Communications Inc. (NYSE:VZ), one of the world's leading providers of communications services. For more information on Verizon Information Services, visit


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