For the first time, the number of small and medium-sized businesses using digital/online media has surpassed the number using traditional media, according to the Kelsey Group.

The penetration of digital/online media increased to 77% in August 2009 from 73% in August 2008, while the penetration of traditional media fell to 69% from 74%. Penetration is defined as the percentage of SMBs using a given type of media, regardless of spending level.

The increase in penetration of online media occurred despite a 23% decline in overall SMB advertising spending, from $2,734 (reported in August 2008) to $2,092 (reported in August 2009). Digital/online spending, as a percentage of total expenditure, increased to nearly 37% in August 2009, from 22% in August 2008.

On average, SMBs increased spending on websites and profile pages nearly 27%, to $769 in 2009 from $608 in 2008.

Moreover, the proportion of SMBs that use the Internet to track or measure their sources of new-business leads has also increased, the study found. Among businesses that track lead sources, the percentage that does so using the Internet (clicks or emails) has increased from 22.0% in 2008 to 30.0% in 2009.

"The milestone of digital/online surpassing traditional media among SMBs is an indicator of the broad shift to online platforms," said Steve Marshal, director of research at the Kelsey Group.

(The use of social media by SMBs will be examined at BIA/Kelsey's upcoming conference, Interactive Local Media 2009 (ILM:09), Dec. 9-11 in Los Angeles.)

 About the data: Findings are from the Local Commerce Monitor, Wave XII, August 2009, an annual tracking survey of SMBs and media, conducted by BIA/Kelsey. Online participants in the nationwide survey included business owners and advertising and marketing decision-makers, representing industries such as home and trade services, professional services, and financial services. The study was cosponsored by ConStat.