Having to do more with less, many small shops go digital.

Small businesses face stiff challenges in 2009.

According to a poll of US marketers by Bredin Business Information, the primary challenges in marketing to small businesses are funding new projects, growing the business with limited resources and increasing awareness.

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In addition, marketers say the outlook for small-business marketing has changed in 2009. They are increasing their online activities, becoming more focused and conducting segmentation research to better target their customers.

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It is no surprise that the local online marketing space is where many small and medium-sized businesses (SMBs) are moving their efforts—and their dollars.

Borrell Associates estimated SMBs spent $7.4 billion on local online marketing in 2008.

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That figure accounted for 11% of all SMB marketing spending, and more than one-half of total US local digital spending, including Website development.