Understanding the small business marketing landscape is crucial if you want to be competitive and stand out.
What are your competitors doing? How are they investing their marketing budgets? What new trends and tactics are they planning to try in 2026?
LocaliQ has the answer to all these questions and more in our second-annual Small Business Marketing Trends Report for 2026, including tons of data and insights from over 300 small businesses!
If you want to see the full report, jump on over to LocaliQ or download it here. And keep reading for 10 key takeaways from the report you need to know to inform your 2026 planning.
10 biggest takeaways from LocaliQ’s 2026 Small Business Marketing Trends Report
We rounded up 10 fast facts from the report to help you understand the small business marketing landscape and make the most of your 2026 planning.
1. Most SMBs still aren’t investing in paid search
According to the report, only 45% of SMBs are investing in search advertising—up from 40% last year, which means the majority of small businesses are still not running ads on top search engines like Google and Bing.
But, more SMBs are investing in SEO than last year—53% compared to 39% in 2024, which means small businesses are primed to capture high-intent, local searchers.
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2. But SMBs running paid search are satisfied with results
When it comes to how satisfied small businesses are with their marketing investments, search advertising was one of the top tactics they were pleased with—behind video marketing and advertising and reputation management.
Search advertising is effective at driving leads and can be pretty easy to measure and tie back to ROI, so it’s not a surprise to see it so high on the list.
3. Low-cost strategies have grown in importance
Last year, low-cost marketing strategies like listings, reputation management, and content marketing were fairly low on the list of channels small businesses were investing in. But, in 2025, more SMBs are investing here.
As more small businesses reel in spending while keeping an eye on the economy (more on this later), it makes sense that low-cost or basically free strategies would become more important. Small businesses are looking for ways to stretch their budgets, and listings, reputation management, and content marketing—along with SEO—can help them get in front of local searchers looking to make a purchase.
One low-cost strategy small businesses still aren’t investing in, though, is website chat. This could be an opportunity for small businesses to provide a contact method that most consumers actually prefer.
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4. Facebook continues to be the most popular social platform SMBs are using for marketing
Social media marketing and advertising are, unsurprisingly, still big hits for businesses, with 66% investing in social media marketing and 56% investing in social ads.
Facebook was the most popular social platform for SMBs to use for marketing for the second year in a row.
Of those businesses investing in social media marketing or social ads, a whopping 91% (up from 80% last year) were doing so on Facebook, followed by Instagram and LinkedIn.
Social media marketing and advertising continues to be a winning strategy for small businesses—it’s a great place to engage and grow an audience while ads make it easy to expand and find similar prospects.
5. Smaller businesses have small budgets (unsurprisingly)
I mean, this is kind of obvious. But understanding the typical marketing budget for your SMB competitors is really handy. LocaliQ found that less than 10% of SMBs had no budget and 52% (up from 38% in 2024) had monthly budgets under $2,500.
And because the report was able to break down marketing budgets by business size, we were able to see a clear correlation between business size and budget. Which, again, isn’t necessarily a surprise, but it should be validating to small businesses who are doing so much with not a lot.
This just shows the importance of adopting those low-cost strategies we mentioned earlier and taking advantage of creative marketing ideas to get in front of potential customers.
We have some you may like here:
6. They’re also less likely to have dedicated marketing support
The smaller the business, the less likely they are to have staff dedicated to marketing. Which does make mastering marketing strategies a challenge—those often take some kind of time commitment.
What’s also interesting is that this year’s report found that fewer SMBs were working with a marketing partner (only 34% in 2025 compared to 60% in 2024!)—meaning these businesses are taking on the majority of the marketing work themselves, even if they have no or few employees dedicated to marketing.
This may explain why low-cost strategies like listings and reputation management were so well-represented; they’re often quicker to get off the ground (even if they may require more back-end work later) and don’t require a lot of time or budget to start driving results.
7. Most SMBs are using AI
Most small businesses are fully on board the AI train. 56% of SMBs are using AI for some part of their marketing! Most are using it to save time and generate ideas for activities like content creation, design, social media management, and more.
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8. The economy continues to be a concern
66% of SMBs noted that economic uncertainty will be their biggest challenge in 2026, up from 48% in 2025.
This isn’t shocking as the economy has remained unstable over the last few years and the introduction of tariffs in 2025 has had many SMBs hesitant to make changes to their budgets or spending behaviors.
Not only was the economy the biggest challenge SMBs noted, but it was also the main reason they were planning to decrease their budgets in 2026.
9. But small businesses aren’t planning to cut budgets in 2026
While the economy is the main factor behind SMBs decreasing budgets in 2026, only 8% are planning to do so. 54% of SMBs are planning to keep their budgets the same and 39% plan to increase in 2026.
This is promising, despite economic concerns—with SMBs planning to either maintain or increase budgets, they have a better chance at driving results and investing in the right marketing strategies to grow their businesses.
10. Customer referrals remains the greatest source for new leads (but getting new leads is still challenging)
Getting new customers continues to be a top challenge for small businesses, with 59% saying it will be one of their top challenges for 2026, up from 45% in 2025. This is something we hear time and time again—generating leads and getting new customers is hard, especially with limited budget and resources.
But when it comes to getting new customers, referrals continues to lead the pack, followed by organic and direct website traffic, and digital marketing and online advertising.
This speaks to the importance of investing in the right strategy to continue bringing in loyal customers and reaching new audiences where they’re spending time online.
Create the right marketing strategy for big results in 2026
Small businesses have big plans for 2026, and this round-up covers just a few of them. To see all the data and insights we gathered from over 300 SMBs, download the full report. And reach out to talk if you need help crafting the right marketing strategy to stand out from the competition.
Here’s a recap of the top takeaways from The Small Business Marketing Trends Report for 2026:
- Most SMBs still aren’t investing in paid search
- But SMBs running paid search are satisfied with results
- Low-cost strategies grew in importance
- Facebook continues to be the most popular social platform SMBs are using for marketing
- Smaller businesses have small budgets (unsurprisingly)
- They’re also less likely to have dedicated marketing support
- Most SMBs are using AI
- The economy continues to be a concern
- Small businesses aren’t planning to cut budgets in 2026
- Customer referrals remains the greatest source for new leads
