Small Businesses Are Taking Tentative&#32

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Small Businesses Are Taking Tentative Steps Toward Online Networking

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BY choice or necessity, successful small-business owners are earnest networkers, gladly shaking hands, handing out cards and attending local meetings to find and keep customers, solve problems, seek feedback or support and bolster their bottom lines.

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Fast, free and efficient — those attributes appealed to Brighter Planet, a socially responsible start-up based in Vermont, which built social networking into its DNA.

“There’s almost a grass-roots quality to it,” said Patti Prairie, its chief executive. “As a start-up, we can’t afford to be buying ads anywhere. We have to use our outreach.”

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A recent study for Sage North America found that 65 percent of small businesses that used social networking sites said that they felt more comfortable doing so this year than they did last year, and 51 percent said that they had acquired and retained customers because of it.

More than 260,000 North American businesses currently use social networking to promote their businesses, Mr. King said.

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Last week, Shustir.com introduced its virtual marketplace, which was started by two former Lehman Brothers colleagues, Shu Kim and Khanh Pham. “It matters where you spend,” Ms. Kim said, echoing the site’s catchphrase. The goal, they said, is to keep Main Street U.S.A. alive.

“We want you to spend with small businesses,” Ms. Pham said. “By doing so, 80 percent of the money goes directly back to the community.”

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The site is arranged so owners can create virtual storefronts with photos, video, blogs and store information, and communicate with customers.

“Shustir gives consumers a one-stop destination,” Ms. Kim said, where they can buy from trusted businesses, post about their favorite shops and make recommendations.

Businesses can exchange advice, ideas and information, and network on a site that provides them search optimization.

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PartnerUp has more than 100,000 active members, and more than 300,000 unique business owners and entrepreneurs come to the site every month, according to Steve Nielsen, its president.

“We’re at an inflection point now,” Mr. Nielsen said, “where social media sites that are specific to a purpose for a market are going mainstream, and they’re not just for early adopters any more.”

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In late 2007, David Reinke joined PartnerUp for a specific purpose. He had quit corporate America to start a fashion rating Web site, StyleHop.com, but needed a partner well versed in technology. He posted a profile on PartnerUp, and a job description for a chief technology officer and said, “Let’s see what happens.”

About a month later, Froilan Mendoza, who had 12 years experience building technology start-ups, contacted him and after a series of discussions, Mr. Mendoza quit his job to become chief technology officer of StyleHop.com.

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Turning to PartnerUp, Mr. Reinke said, was consistent with how he uses online sites. “I was looking for something specific. I go to the source where the experts are,” Mr. Reinke said. PartnerUp also allowed for a quiet search and limited exposure, he added, so thousands of people would not know about his start-up.

To be sure, the majority of smaller concerns have not caught the online wave. In its monthly index, Discover noted that 62 percent of businesses still do not have Web sites

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What’s more, when asked which networking opportunities they used most, 46 percent of small-business owners identified traditional methods like conferences, trade shows, local in-person groups or chambers of commerce. Of the remaining respondents, 16 percent cited “other” networking opportunities, 8 percent cited online sites, 7 percent said e-mail messages and 22 percent said they were not sure.

Mr. King of Sage North America estimates that small businesses have a 12-month window to figure out online social networking. “I hate to say it, but if they don’t, they’ll get left in the dust,” he said. “It’s here to stay.”