THE IMPACT OF DIGITAL MARKETING ON SMALL BUSINESSES IN

ILIGAN CITY

A RESEARCH PAPER

Presented to
The Faculty of
Iligan Computer Institute
Iligan City

In Partial Fulfillment
of the Requirements for the Subject
PRACTICAL RESEARCH 2

Submitted by:
Abesia, France
Arcasa, John Carlo Rein
Daso, Angel
Genon, Antonette
Herrera, Johvan
Quimod, Bridgette
Rizon, Hizel
Raman, Elizalde
Ronquillo, Chenlyn
Siarot, Romign
Saligan, Francine Laurice

December 2024
 CHAPTER 1

THE PROBLEM AND ITS SCOPE

Background of the Study

Digital Marketing also called “online marketing” is the promotion of brands to

connect with potential customers using the internet and other forms of digital
communication. This includes not only email, social media, and web-based advertising,
but also text and multimedia messages as a marketing channel. Most of the problem of
local businesses is not using digital marketing, without using digital marketing, the
company would find it difficult to connect with potential clients outside of its immediate
physical location. This limited visibility can hinder growth and expansion opportunities.

This implies that digital marketing has a significant impact on business strategies
and customer engagement in Iligan City, leading to notable economic progress. With the
adoption of various digital marketing techniques, local businesses have expanded their
reach beyond traditional boundaries, leveraging online platforms and social media to
connect with a broader audience. As a result, there has been a noticeable increase in
brand visibility, customer acquisition, and loyalty, indicating a higher level of
competitiveness and sustainability for businesses in the area. Moreover, the integration
of digital marketing methods like social media ads, and email campaigns has allowed
businesses to adapt to changing consumer preferences, driving innovation and economic
growth within the local community

According to Nareem (2023), it states that digital marketing empowers

businesses to reach the right people with the right message. Through advanced analytics
and insights, companies can understand their audience's preferences, behavior, and
demographics. This means that marketing messages can be tailored to resonate
personally, resulting in higher conversion rates and improved customer satisfaction.
Digital marketing provides an abundance of data, allowing businesses to make informed
decisions, optimize strategies in real time, and predict trends accurately.
 The purpose of this research focuses on the impact of digital marketing on local
businesses in Iligan City to assess how online marketing strategies influence the growth
of digital marketing. This research will also analyze the effectiveness of digital
marketing strategies in promoting local businesses and determining how they can
improve customer engagement.

The duration of this study entitled “The Impact of Digital Marketing on Local
Business in Iligan City” will be conducted in the First Semester of School Year 2024-
2025.

Statement of the Problem

The core problem faced by impact of digital on local business in iligan city in
year 2023-2024 frequently the challenge of effectively leveraging online
channels to compete with larger, more resourceful competitors while navigating
issues such as limited budgets, a lack of expertise, and difficulty standing out
amidst online noise and competition

Research Questions
1. As a local firm with limited funds, how are you going to prioritize digital
marketing activities to maximize your impact?
2. What is the impact of e-commerce on your revenue and growth here in Iligan
City?
3. How effective is utilizing digital strategies (social media advertising, search
engine optimization) to reach customers?
4. What is the average cost savings achieved by your business that have transitioned
to paperless operations through digital document management systems?
5. What is the impact of digital customer relationship management (CRM) systems
on customer satisfaction and loyalty to your business?
Scope and Delimitations of the Study
The scope of this study will be focused on what is the impact of digital
marketing on local businesses in Iligan City to assess how online
marketing strategies influence the growth of digital marketing. This
study will consist of how digital marketing will affect local businesses in
Iligan City 2024-2025.

Significance of the Study

This section highlights the individuals and groups who will most likely benefit from the
findings of the study.

Students.

This study will help students, particularly those in business, marketing, or

entrepreneurship programs, gain a deeper understanding of the role digital marketing
plays in the success of small businesses. The insights can guide them in making
informed academic and career choices, as well as in developing relevant skills that align
with current industry demands.

Teachers.

Educators can use the findings to enhance their teaching materials and methods. The
study provides up-to-date information on digital marketing trends and practices, which
can support curriculum development and classroom discussions. It may also encourage
teachers to integrate real-world applications and case studies, enriching students’
learning experiences.

Administrators.

School administrators and education program planners can use the study to evaluate and
improve course offerings related to business and marketing. By understanding the
importance of digital marketing in today’s business environment, they can ensure that
academic programs remain relevant, practical, and aligned with industry needs, helping
students become more competitive in the job market.
 CHAPTER 2

REVIEW OF RELATED LITERATURE AND STUDIES

This chapter provides the overview of the existing literature and studies related to
The Impact of Digital Marketing on Local Business in Iligan City in Year 2023-2024 It
seeks to investigate and evaluate a range of ideas, conclusions, and viewpoints from
earlier studies that are relevant to this topic. The review is divided into two sections:
related literature and related studies,both of which will help lay the foundation for the
current study.

Related Literature

Digital marketing has significantly reshaped the business landscape over recent
years, especially for small and local businesses. According to Smith (2021), compared to
traditional marketing strategies, digital marketing has distinct advantages, especially in
terms of reach and cost effectiveness. According to Smith's research, local firms can
more successfully reach their target consumers by utilizing digital marketing techniques
like email marketing and social media marketing. Smith's work is particularly relevant to
this study since it emphasizes how crucial it is to implement digital marketing tactics in
order to stay competitive in a market that is changing quickly. This aligns with the
present research, which aims to measure the impact of digital marketing on local firms in
terms of consumer reach, revenue growth, and brand loyalty.

The development of information technology is rapidly evolving G gunaman,

Maman Sulaeman (2020). Various small to large business activities utilize this
development to run their business. The number of competitors is a consideration for
entrepreneurs to enter into very tight competition. The right marketing and media
strategy is used to be able to reach the intended market so that sales volume is always
increasing and profit. Digital Marketing is one of the marketing media that is currently in
demand by the public to support various activities carried out. They are little by little
starting to abandon the convesional/traditional marketing model of switching to modern
digital marketing. With digital marketing communication and transactions can be done at
any time/real time and can be global or global. With this large number of chat-based
social media users and increasingly increasing days it opens up opportunities for SMEs
to develop their markets.

Ainin and colleagues (2015) explore the adoption of e-commerce and digital
marketing among small enterprises, including local businesses. The study finds that the
adoption of digital marketing tools like social media and online marketplaces helps local
businesses expand their market reach beyond their immediate geographical area.
However, they also note challenges such as a lack of digital skills and concerns about
data privacy, which can hinder the effective use of digital tools.

Related Studies

According to regina denda octavrya (2022) In the current era of technology, it

provides many impacts and innovations that can provide more effective solutions in
various fields. With digital marketing as an alternative solution, digital marketing can
now overcome problems such as lack of funds and limited promotions faced by medium
to low-income businesses. The alternative solution is obtained with the current social
media such as Twitter, Instagram, Website, and Facebook to create brand awareness,
loyalty, sales, and engagement.

S.W. Huang & P. Saridakis (2019) found that digital marketing positively impacts
sales growth and brand awareness for local businesses. The study suggests that digital
marketing helps level the playing field, allowing small businesses to compete with larger
firms by reaching broader audiences at a relatively low cost.

Several studies have examined the effects of digital marketing on local businesses,
specifically concentrating on its sway over client conduct and sales outcomes. For
example, a study conducted by Lee and Kim in (2022) investigated the relationship
between social media marketing and consumer involvement in small urban firms. Their
study took a quantitative approach, using survey information from 500 nearby
companies in a variety of sectors. Since Lee and Kim's study shows the real advantages
of digital marketing on local businesses' customer involvement, it is extremely relevant
to the current research. This study aims to investigate which digital marketing tactics
work best for small businesses by analyzing the impact of social media marketing on
consumer behavior.

Theoritical Framework

This study is anchored by The Diffusion of Innovations Theory developed by E.M. Rogers (1962).
According to this theory, new technology and other advancements spread throughout societies and
cultures, from introduction to widespread adoption. The diffusion of innovations theory seeks to explain
how and why new ideas and practices are adopted, including why the adoption of new ideas can be spread
out over long periods.

The way in which innovations are communicated to different parts of society and the subjective opinions
associated with the innovations are important factors in how quickly diffusion or spreading occurs. This
theory is frequently referred to when companies are developing a marketing strategy for new products and
developing market share.

INTE

AWA
REN
ESS ADA
EVAL
UATI

T
R
Conceptual Framework

This concept framework suggests that the use of digital marketing tools such as posting products on
Facebook, responding to customer inquiries via Messenger or SMS, and using local online marketplaces
can help local businesses in iligan city increase their customer reach, improve sales, and build stronger
customer loyalty.

•Facebook Page •Business

Performance
•Posting on Local Online
Marketplaces (e.g., •Customer Reach
Shopee, Lazada,
instagram, FB •Market reach
Marketplace)
•Content Marketing.

Definition of Terms

Digital marketing is the use of digital channels, including websites, social media,
email, search engines, and mobile apps, to promote products or services and engage
customers. It comprises a variety of approaches and strategies for reaching and
influencing certain audiences online..
 CHAPTER 3

RESEARCH METHODOLOGY

This study will determine The impact of Digital Marketing on Local Businesses in

Iligan City. Moreover, this chapter discusses the research methodologies of the

study which includes the research design, local of the study.

Research Design

This study used quantitative research using Semi-structured One to one

questionnaires utilized for data collection. The research formulated a questionnaire

structured surveys to local businesses, collecting quantitative data on digital

marketing strategies, business performance metrics, and perceived impact.

Data Collection Techniques

Survey were conducted on-site at various local business locations to understand the

impact of digital marketing on customer engagement and business performance. We

focused on Surveying customer interactions with businesses, particularly their

engagement with digital marketing platforms like social media and online sales channels.

This allowed us to capture real-time data on how digital marketing strategies directly

influenced business activities, providing valuable insights into the effectiveness of these

techniques in the local context of Iligan City.

Research Instrument

The Impact of Digital Marketing on Local Businesses in Iligan City for 2023-2024,

a quantitative research approach will be employed using various instruments. Online

surveys will be distributed to business owners and customers, focusing on the types of

digital marketing strategies utilized, perceived effectiveness, and changes in sales

performance. Structured interviews will provide deeper insights into individual

experiences, while focus groups will facilitate discussions on common challenges and

successes. Additionally, secondary data analysis of financial records and social media

metrics will offer objective measures of business performance. Website analytics will

track customer engagement and conversion rates, and customer feedback forms will

gauge awareness and influence of digital marketing on purchasing decisions. This multi-

faceted approach will enable a comprehensive understanding of how digital marketing

affects local businesses in the region.

INFORMANTS

In this study, purposive sampling will be used. A method of sampling where the

researchers will choose who will include the study based on their ability to provide

necessary data. The participants of this study will be the owner of the selected local

businesses in Iligan City. Iligan City has numerous local businesses, thus the researchers

have decided to select only 50 local businesses. The researchers aim that these

participants would be enough to provide sufficient and essential information to answer

the question raised in this study.

Data Analysis

Using the data collected, a data analysis plan includes a few series of steps leading to a

research finding or outcome. Summary of Numerical Data. It is done by using

frequencies and percentages to count based on respondents' specific responses in the

survey questionnaires given.

Summary of Numerical Data. It is done by using frequencies and percentages to count

based on respondents' specific responses in the survey questionnaires given.

Data Visualization. This method could help the researchers analyze the given data by

using tables in the study to improve data analysis and identification of patterns. All the

responses of the selected participants will be analyzed with the help of data visualization.

The researchers aim to present clean, consistent, and comprehensive data.

ETHICAL CONSIDERATIONS

In this study, the researchers want to make sure that everyone who chooses to participate

does so willingly and feels comfortable throughout the process. Participation is

completely voluntary. We are committed to maintaining strict confidentiality and

ensuring that all personal information collected during the study will remain anonymous.
 CHAPTER 4

PRESENTATION, INTERPRETATION OF DATA ANALYSIS

This chapter discusses the result of the data obtained from the respondents including

the evaluation and the interpretation of the data.

Table 1.1 Level of Expertise

LEVEL FREQUENCY PERCENTAGE

BEGINNER 16 32%
INTERMEDIATE 23 46%
ADVANCED 10 20%

Interpretation:

Most respondents 23(46%) identified themselves as intermediate learners in digital

marketing. A significant portion 16(32%) are beginners, while a smaller group

(20%) consider themselves advanced. This distribution indicates a need for varied

learning resources to cater to different skill levels within the group.

Table 1.2 Preferred digital marketing channel

 PREFFERED FREQUENCY PERCENTAGE
Email Marketing 5 5%
Social Media Marketing 36 72%
Pay Per Click 5 10%
Search Engine 5 10%
Optimization
Content Marketing 5 10%

Interpretation:

Due to its popularity and perceived efficacy, social media marketing is the digital

marketing method most respondents choose. Only five replies (10% each) were

received for other digital marketing strategies like content marketing, pay-per-click

(PPC), email marketing, and search engine optimization (SEO). Commpared to

SMM, these channels are far less preferred. The information clearly indicates that

the studied group prefers social media platforms as their main marketing strategy.

This emphasizes how crucial social media tactics are for connecting with this target

market

Table 1.3 Interest in Learning Digital Marketing

INTEREST FREQUENCY PERCENTAGE

Yes 72 144%
No 4 8%
Not sure 3 6%
Interpretation:

Most of the respondents, in 144%, showed interest in learning digital marketing.

This means that a large number of people are eager and curious to gain more

knowledge and skills in this area. It reflects how important and appealing digital

marketing is to them. And in 8% of the respondents said they are not interested,

and the remaining 6% were unsure. This small group may not be interested or are

undecided, the majority are clearly motivated to learn more about digital

marketing and possibly pursue opportunities related to it in the future.

Table 1.4 Preferred Formats

PREFFERED FREQUENCY PERCENTAGE

Videos 25 50%
Infographics 8 16%
Case studies 3 6%
Blog post 24 48%

Interpretation:

Videos are the most preferred format that have a 50% are the common used by

business. Then followed by blog posts that have 48% used to promote product and

to be followed infographic and case study.

Table 1.5 Preferred Social Media Platform

 PREFFERED FREQUENCY PERCENTAGE
Facebook 19 38%
Instagram 19 38%
Twitter 13 26%
Tiktok 4 8%

Interpretation:

Most people like Facebook and Instagram the same, each was chosen by 38% of the

people. Twitter was picked by 26%, which is less but still used. TikTok is the least

liked, with only 8% of people choosing it.

Table 1.6 Monthly Income

INCOME FREQUENCY PERCENTAGE

Less than 5,000 10 20%
5,000-10,000 22 44%
15,000-20,000 4 8%
More than 20,000 12 24%

Interpretation:

The majority of respondents, 44%, earn between ₱5,000 and ₱10,000, with 24%

above ₱20,000, 20% below ₱5,000, and 8% within the ₱15,000 to ₱20,000 range.

Most earn below or around ₱10,000 monthly.

 CHAPTER 5

SUMMARY OF FINDINGS, CONCLUSION, AND RECOMMENDATION

Summary of Findings

This research study made use of the descriptive method of research and the

questionnaire served as the instrument for gathering data. A significant number of

business owners and individuals involved in local enterprises have already embraced

digital platforms, particularly social media, as key tools for promoting their products and

services. Based on the data gathered from the respondents, 46% identified themselves as

having an intermediate level of expertise in digital marketing. Meanwhile 32%

considered themselves beginners, and only 20% classified themselves as advanced users.

This indicates a mixed level of digital marketing knowledge among local business

owners, suggesting the needs for training programs tailored to various skill levels.

The study was conducted during the second semester of the academic year 2024-

2025. Based on the data gathered, when it comes to preferred digital marketing

channels, 72% of the respondents favored social media marketing, making it the most

widely used strategy. The remaining methods email marketing, pay per click, search

engine optimization, and content marketing were each preferred by only 10% or less of

the respondents. This social media plays a central role in how local businesses in Iligan

City connect with their audience.

In terms of interest in learning digital marketing, A significant majority expressed a

strong desire to acquire more knowledge and skills related to digital marketing strategies.

A remarkable 144% of the participants expressed interest, though this unusually high

figure may reflect a data error or duplication. And also the 8% of respondents said they

were not interested in learning more about digital marketing, and 6% were unsure. This

eagerness for further education underscores the perceived importance of digital

marketing in driving business growth. It also indicates that small business owners in

Iligan City are increasingly aware of the role that effective online marketing can play in

their overall business strategy.

When the respondent asked about the types of content they like to use or see in

digital marketing, most respondents preferred videos, with 50% choosing this format.
This means that half of the people surveyed find videos to be the most helpful or

interesting way to learn about products or services. While the 48% of the respondents

said they liked blog posts, which shows that written articles are also very popular which

use pictures and charts to explain ideas. The Infographics were chosen by 16% of the

respondents. Lastly, only 6% said they preferred case studies, which are detailed stories

or reports about real business examples. These results suggest that most people enjoy

simple, easy-to-understand, and visually appealing content. Videos and blog posts are

especially effective because they can quickly catch people’s attention and explain

information in a fun and engaging way.

Digital marketing has a significant influence on the growth and development of small

businesses in Iligan City. A large portion of business owners and individuals involved in

local enterprises are already engaged with digital platforms, particularly social media,

which emerged as the most preferred marketing channel. Facebook and Instagram were

equally the most used platforms, chosen by 38% of the respondents. Followed with

Twitter 26% respondents, and TikTok was the least preferred, chosen by only 8%. This

implies that Facebook and Instagram are the dominant platforms for marketing among

local businesses.
 Lastly, the income levels of respondents revealed that 44% earned between ₱5,000

and ₱10,000 per month. Another 24% earned more than ₱20,000, 20% earned less than

₱5,000, and only 8% had a monthly income between ₱15,000 and ₱20,000. These

figures reflect the economic diversity of the business owners surveyed.

CONCLUSION

This study examined the impact of digital marketing on local businesses in Iligan City,

finding a considerable positive impact on their growth and performance. Digital

marketing significantly expands reach, increases customer engagement, and boosts sales

through strategies like social media, SEO, and online advertising. However, local

businesses face challenges such as limited budgets, lack of expertise, and online

competition. The study, using a quantitative approach with questionnaires, observations,

and interviews, explored how businesses prioritize digital marketing activities, the

impact of e-commerce on revenue, the effectiveness of specific digital strategies, cost

savings from paperless operations, and the influence of digital Customer Relationship

Management systems on customer satisfaction. Despite limitations like inadequate

digital skills and resources, many local entrepreneurs recognize the value of a digital

presence, utilizing cost-effective and efficient methods such as social media and online

tools to promote their products. The results provide valuable insights for local

businesses, marketing professionals, and the community, highlighting best practices and

strategies for leveraging digital marketing to achieve sustainable growth and economic

development in Iligan City, demonstrating its effectiveness in helping small businesses

succeed in a rapidly changing digital landscape.

RECOMMENDATIONS

• Create initiatives to assist proprietors the digital marketing with marketing,

training, and funding.

• To lessen the influence on the environment, encourage eco-friendly practices

in retail establishments.

• Assist owners in developing community ties and loyalty programs.

• To boost the local economy, encourage retailers to carry locally produced

goods.

• Give the owners a chance to connect, exchange ideas, and work together.
To the future researchers

This study offers a foundation for future research in the fields of digital marketing and

small business development. It may inspire others to explore related topics, apply similar

methodologies, or address identified research gaps. Future researchers can build on the

findings to deepen the understanding of how digital tools impact small enterprises in

various contexts.

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