Markets continuously change, and businesses have always had to adapt to these changes to remain successful. In this regard, the emergence of the digital economy and necessity for companies to move online is no different from any other changes to market structures and dynamics facing SMEs over the years, presenting new customer demands, new channels of information and communications, new payment systems, new products and new opportunities.
Opportunities – According to the latest ONS figures, ‘micro-enterprises’ (businesses with less than 10 employees) were banking online sales of £21.2 billion in 2015. Yet still only (46.4%) of small businesses actually have website. It’s clear that UK SMEs without a digital presence are missing out. A recent study from the Department for Business Innovation and Skills showed that more than half of the public find it difficult to support local small firms because these businesses aren’t online. In fact, figures also show that more than 2 million sole traders and small companies are missing out on business because they have no online presence at all. Around 60% of consumers under 35 now follow brands via social media, yet only 30.4% of SMEs use the likes of Twitter, Facebook et al to connect with these potential customers and take advantage of the platform. These are huge opportunities to improve business efficacy and create growth with a relatively small outlay being completely missed by smaller businesses.
Risks – With new opportunities come new risks too. It’s clear that having no web presence is bad for business, but without the technical know-how to build, optimise and maintain a professional website, companies who set up a poor site and don’t invest in the necessary tech, content, or allow their social media channels to lie fallow run the risk of doing their company reputation more harm than good. For better or worse, a website is now usually the first contact that a potential customer will have with a company’s ‘brand’. If a website doesn’t meet the potential client’s expectation of what the business does and how well they do it, the prospective customer won’t pick up the phone and they’ll probably also cross that particular supplier off their list of potential future resources. Therefore, having a bad website actually puts a business at risk of being in a worse situation than having no online presence at all.
All things considered, it’s clear any SME looking to set up online needs to possess more than a basic knowledge of the Internet in order to succeed. A company of any size looking to take advantage of these opportunities and negate these risks must have the necessary skills to properly set up a website and know how to market their company online. Luckily, for SMEs lacking such resources, this is no longer an obstacle with the likes of SoleTrader.com who will build you a website equipped with all the layouts, imagery and written content you might need and include the necessary SEO (Search Engine Optimisation) and customer support as required.
The risks and opportunities emerging from the digital marketplace are, in many ways no different from any other market shifts of the past. Consumer behaviours change, different generations provide and expect different ways of doing things, developments in technology pose both new solutions and new problems. It’s important to remember that what is different about the phenomenon of business moving online is both the magnitude and speed of these changes and the scope for new technology to make it easier than ever for smaller enterprises to compete with larger firms.
By David Marrone
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