Technology in SMBs
Overall, 98% of SMBs reported owning a computer of some description. This compares with 88% last year.
Ownership of desktops (94%), notebooks (49%) and tablets (41%) is more prevalent in medium size businesses, especially notebooks and tablets. This also applies to penetration of other types of technology such as smartphones, Local Area Networks (LAN), satellite navigation and advanced telephony systems. Like last year we see that these devices are used in a clear majority of medium sized firms but only the increasingly popular smartphones are found in most small businesses. Nevertheless, many firms continue to use a variety of technological tools.
Ninety three percent of SMBs are connected to the internet, which is nine points higher than last survey. Among medium size businesses internet connectivity is at 99%, compared with 93% in small businesses.
The importance of the internet for business to business (B2B) transactions continues to be highlighted with the most prominent reasons for use being email, banking, looking for information about products and services, seeking suppliers of products and services and paying for products and services. Use of the internet for marketing purposes is still not at a majority level but is growing.
Sixty one percent of SMBs have a website, which is up from 56% in 2015. Medium businesses have embraced websites more than small firms – 91% compared to 60%. A further 4% of online SMBs intend to develop a website within the next year and they are all small businesses.
Sixty percent of SMBs with websites believe this has improved the effectiveness of their business, primarily by increasing their exposure, followed by providing customers with information.
Social media and SMBs
Close to half the SMBs (48%) are now using social media and this has grown from 31% in 2015. Facebook is by far their preferred social media platform (88%), well ahead of others like Twitter (25%), LinkedIn (23%) or Instagram (13%).
SMB buying and selling online
Seventy five percent of SMBs make purchases online – this incidence is 15 points higher than in 2015. For these SMBs, an average of 45% of their total procurement was transacted online, up one percentage point from last year. The incidence of online purchasing is 74% among small businesses and 93% in medium size businesses.
Online sales as a share of total sales activities continue to rise steadily, from 32% to 43% over the last four years. More than a third (34%) of SMBs who use e-commerce made the majority of their sales online, which was up three percentage points in the past year.
Once again we found the majority of SMBs’ mostly sell to customers in their local area (67%). Around one quarter (25%) made sales to customers overseas, which is slightly down from the 2015 finding (27%).
Hacking remains the biggest concern that SMBs have about e-commerce, with over two thirds (69%) rating it as a concern.
SMBs’ use of online advertising and other applications
Thirty four percent of online SMBs advertise on social networks, which has increased from 31% in 2015 and is now the most common form of digital advertising, slightly higher than online advertising (32%, down three points).
Around a third use cloud computing or unpaid search engine optimisation (SEO). Uptake of both applications has increased slightly (three and four points respectively). Other applications were each mentioned by about one in five SMBs or fewer. Mobile applications (13%) and mobile advertising (7%) have not really grown in the last year.
A majority of SMBs believe it’s important to be on page one of a Google search, with 20% saying it’s very important and 39% saying this is somewhat important.
Digital business strategies
Less than one in five online SMBs (19%) reported having a digital business strategy which is consistent with recent findings.