Mid-market businesses are vital to America’s economy, often the key to employment and job growth and responsible for more than $10 Trillion on annual revenue. Mid-Market business, defined as $10 million to $1billion in revenue comprise barely 3% of all firms in number but provide 1 out of 3 American jobs.
A few weeks ago, I attended the Wall Street Journal executive conference where experts gathered at the US Chamber of Commerce Headquarters in Washington, D.C., to discuss “Accelerating America’s Middle Market.”
“We continue to see that if you want to drive growth in the U.S. economy, you find it in the middle,” says Tom Stewart, executive director of the National Center for the Middle Market, a partnership between The Ohio State University Fisher College of Business and GE Capital. “This is where organic growth happens.”
The Outlook for Mid-Market Companies
“Slower, but not bad growth.” Sixty-percent of middle market companies project positive revenue growth on 2Q 2015 compared to 70% on 2Q 2014.
According to a survey of midmarket executives, the top 5 challenges to company growth are:
- Uncertain Economic Outlook
- Weak Market Demand
- Cost of Raw Materials
- Cost of Keeping up with Technologic Advances
- Health-Care Costs
Just how much will the uncertain global outlook impact the American Mid-Market?
Global Market Volatility
According to Anil K. Makhija, Dean of the Fisher College of Business at Ohio State University, 60% of mid-market companies have absolutely no foreign sales. Only 10% of sales from the remaining 40% come from abroad. Overall, according to Makhija, only about 4% of the sales of a typical middle-market firm come from abroad. And where are they coming from? “They’re not coming from China,” said Makhija. “So the slowdown in China, the direct impact is limited because the places that the middle-market firms do business with are Mexico and Canada.”
Big Data for Mid-sized Business
No doubt, big data is big business, but how can mid-market companies with fewer resources use data to gain a competitive edge?
Top 5 Big Data Tools (by percentage of midmarket executives surveyed rating the tool as extremely valuable)
- Real-time processing of data and analytics: 60%
- Predictive analytics: 58%
- Data visualization to convert processed data into actionable insights: 56%
- Use of cloud computing to provide anytime, anywhere data and applications access at lower cost: 53%
- Data aggregation that spans multiple databases, including big data platforms such as Hadoop: 50%
- Data dashboards (desktop self-service data integration): 49%
Top Challenges in Using Big Data to Achieve Business Goals (by percentage of midmarket executives surveyed)
- Wide variety of new data types and structures: 40%
- Sheer volume of data slows processing: 34%
- Budget limitations to improve our data analysis capabilities: 32%
- Determining what data to use for different business decision: 29%
- Getting business units to share information across organizational silos: 27%
Social Media as Business Enabler
How should mid market companies approach social media was a big topic touched on the conference. “Social should be a business enabler. It’s outgrown the days of it being fad or an adjunct or just a listening post,” says Christopher Graves, Global chairman of Ogilvy Public Relations.
A common misnomer among business executives is that social media is more influential on the Business to Consumer (B2C) segment than on the Business to Business (B2B). However, “It’s actually even more efficient in many cases in B2B,” said Graves. “If the content is relevant and useful to your prospects and to your clients, it is far more targeted.”
Given the growing importance of social media (upwards of 35% of all media spending), both B2C and B2B organizations continue to struggle with measuring the impact of social media on customer loyalty and profitability.
What do you see as the biggest challenges to mid-market growth? What big data/analytics tools do you find most helpful? How do you measure social media ROI? Share your ideas on Twitter using #MoveTopRight.