Marketing

What Is an SMB (Small-to-Medium Business)?

What Is a Small-to-Medium Business (SMB)?
Written by Tiffany Verbeck

What is an SMB (small-to-medium business)? SMBs are classified based on their annual revenue (under $50MM for small, under $1B for medium) or their size (under 100 employees for small, under 1000 employees for medium), depending on who’s doing the classifying. As you might guess, SMBs are on the smaller side when compared to other businesses — but they’re worth your marketing efforts.

The term small-to-medium business (SMB) is a classification of a company or organization that relies on the number of employees and annual revenue for its definition. Gartner defines SMBs as bringing in less than $50 million in annual revenue for small businesses, and less than $1 billion in annual revenue for medium, or midsized, businesses. Small businesses have between 1 and 100 employees while medium-sized businesses employ between 100 and 999 people. Although there are several definitions of SMBs out there, these numbers are typical.

SMB is also a marketing term. It developed like all acronyms in the marketing world — to simplify communications. However, keep in mind that most small businesses don’t refer to themselves as SMBs. Thus, using the term when you’re connecting with potential clients could be off-putting.

Tips for marketing to SMBs:

  • Don’t call them an SMB or use other marketing jargon when communicating with them.
  • Understand that they are likely low on resources and time, so try to solve that for them.
  • Prove that you can help SMBs with their long-term sustainability.
  • There’s less wiggle room in their budgets, so let them know their dollars will count for something.
  • Use language that makes it clear you respect them as a small or medium business and will work as hard for them as for larger companies.
  • Target SMBs directly on your website rather than relying on word-of-mouth.

Examples of small-to-medium businesses:

  1. Bike shops
  2. Bakeries
  3. Construction businesses
  4. Mechanic shops
  5. Freelancers and consultants
  6. Professional IT services
  7. Health care businesses
  8. Personal trainers
  9. Car dealerships
  10. Hotels and inns
What is a small-to-medium business (SMB) and how are they classified? Learn more about them, get tips for marketing to SMBs, and see examples. Click To Tweet

About the author

Tiffany Verbeck

Tiffany Verbeck is an experienced personal finance writer. Although she was born in the Midwest, she transplanted her life to move to Washington, D.C. in early 2011 and pursued a master's degree in writing. She enjoys putting her degree to use to tell brand stories of small businesses and entrepreneurs, and her work has appeared on The Financial Diet, Fast Capital 360, Matador Network, The Write Life, and more. Although she's always open to new opportunities, her writing mostly focuses on personal finance, budgeting, travel, and small businesses.

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