Making Digital Work for SMEs

Every day, 294 bn emails are exchanged, 2 mn blog posts are written, 172 mn people log into Facebook, 250 mn photos are uploaded, 864,000 hours of videos are uploaded to YouTube and the information generated on the internet could fill 168 mn DVDs, says a report. Remember, this much data is generated when only 40% of the world's population is online. The growth of digital ecosystem has been mind boggling. Today, if you don't have a digital presence, you are not considered present at all. This is true for individuals, as it is for businesses. That access to internet is being considered as a basic human right and that digital divide is being highlighted as a major impediment to human progress, is indicative enough of how important the digital ecosystem is and the powers it holds in transforming lives.

MICRO, SMALL AND MEDIUM ENTERPRISES

While large domestic and multinational companies in India have built a strong presence on the digital landscape and are using the online marketplace to their advantage, the story of micro, small and medium enterprises (MSMEs) is different. There are around 26 mn MSMEs in the country. They contributed 40% to the total exports of India and about 45% of the total manufacturing output. Close to 69 mn people are employed by these units. The sector has grown at double digits. However, it ails from poor technology usage. The Prime Minister's task force on MSME sector cites low technology used by these companies as a key reason for poor competitiveness of the sector, something which even threatens their survival in an era of global marketplace. Furthermore, the report highlights marketing as one area where they face significant roadblocks on account of lack of finance as well as lack of awareness.

Globalization is the reality of the day. Businesses have to embrace it and tweak their models of operation and marketing to be a winner. The big businesses have established models of customer finds. They have the resources and budgets to execute marketing campaigns and create the optimum impact via the digital medium. Large corporations also undertake million dollar campaigns purely for building their brand. This may or may not have direct bearing on customer wins. In a nutshell, they have the wherewithal to plan and execute marketing strategies that gets them noticed, that gets them customers that helps them stay ahead of the competition. However, for the MSMEs, the battle is tough.

THE DIGITAL WORLD-THE GAME CHANGER

In such a scenario, the game changer for MSMEs can truly be the digital world. They have to not only embrace it, but make it work for them. I will address the latter part a little later, but for starters, they have to build presence in the online world. Buying a domain, creating a website, listing on a search engine-these are some of the first steps towards establishing a presence. The next thing is about being noticed.

So you have set up a shop, you are selling excellent quality products, but if customers don't notice your shop, you'll not get business. In the beginning, I mentioned the statistics I read about internet data. While they might be global, the figures for India will be significant as well. Within this sea, how do you make sure that customers can spot you? Using search engine optimization, social marketing apps, mobile optimized site, being on YouTube among other things will help you get noticed. In fact, YouTube is the second largest search engine in the world. Finally, we have the transactional aspect that is being part of the online marketplace-having a payment gateway on your site and ensuring availability of product on e-commerce sites.

One of the key things for MSMEs is making digital work for them. So when you market yourself, you have to market at the right place to the right audience. We have approximately 5,500 sub categories and this list keeps getting revised. Being in the right category for your product/services is what makes it work. The same holds true for social media presence. MSMEs must avoid falling into the copy-cat trap. Just because a particular strategy worked for someone, doesn't mean that replicating that with your business will generate similar results.

 

CONCLUSION

India has the world's third largest internet user base. Increase in mobile telephony and proliferation of smartphone devices means that the number of customers you can reach out is phenomenal. The future of the internet is on the mobile. For MSMEs it is imperative to get on the digital band wagon. It is the place which holds the potential of transforming their business and doing so in a cost effective manner. You can achieve the right digital impact.