New research conducted by Brighton-based PR consultancy Vada Media indicates that referrals and networking are the most effective marketing tactics used by small businesses in the services industries.

Over 100 businesses took part in the study, and results point toward the existence of a strong networking community in Brighton. Professional bodies and business associations were mentioned as key players in driving networking opportunities.

The key findings of the research were as follows:

• 69% of business is likely to come from recommendations and referrals by existing clients and contacts.
• 94% of respondents cited recommendations from existing clients as one of the most important source of new work, with informal networking being mentioned by at least 88% of businesses.
• Websites were the third most important method for finding new clients, being mentioned by 82% of businesses surveyed.

These were followed by professional bodies (47%), Facilitated networking (via groups such as BNI, 41%) and trade associations (35%)

The more traditional ‘cold¹ contact methods were far less popular, with email approaches being cited by only 31%, postal approaches by only 28% and telephone cold-calling by only 17% of businesses as an effective business development tool. Traditional advertising is successful for only 11%, with direct mail and online advertising effective for only 6% of businesses each.

When asked for the least effective business development method, 36% of respondents said advertising (citing high cost and lack of targeting), 22% said cold calling on the telephone (time consuming and low success rate), 20% said direct marketing (high production costs and lack of targeting) and 9% said email (due to the likelihood of being considered as spam). Other methods listed as unsuccessful were professional organisations (too expensive for SMEs, 7%) and online advertising (6%, not targeted enough).