American billionaire, Bill Gates famously says: “If your business is not on the Internet then your business will soon be out of business.” With these few simple words, the founder of Microsoft sums up the growing importance of digital marketing for every business. However, if we read between the lines, this message from Bill Gates is primarily for small businesses that are struggling to go online or have an insignificant presence on the Internet.
Therefore, let’s examine why a billionaire such as Bill Gates would give such a stark warning to small businesses.
Facts & Figures
Global e-commerce in 2018 stood at a whopping US$3 billion in 2018, according to a report by Oberlo.com. In 2019, global e-commerce is projected to have crossed the US$3.45 trillion mark. It is expected to hit the US$4.135 trillion thresholds this year and touch the US$4.878 trillion landmark by next year or 2021, the report adds.
While China and the US remain leaders in e-commerce, jointly accounting for US$1.3 trillion, other fast-emerging markets include India, the UK, Germany, and countries of the Middle East. Projections indicate India alone will contribute over US$14.403 billion to the global e-commerce industry in 2020, touching the US$17.690 mark by 2021.
Remember, e-commerce doesn’t merely include Business-to-Consumer (B2C) sales on online shopping portals such as Amazon. It also includes Business-to-Business (B2B) sales, financial transactions, and lots of other elements.
These figures and facts indicate the importance of digital marketing for businesses of every size including the growth of small businesses.
The Small Businesses Scenario
In India, Small and Medium Enterprises, collectively known as SMEs, account for 95% of the industrial sector. The number of industries in this country totals 42.50 million. While some of these units are registered, others are not because they have been exempted from license facilities offered by the government of India.
Over 106 million women and men are employed by SMEs in India, according to available statistics.
The Indian SMEs provide more than 6,000 products and services, which contribute about 6.11 per cent of the nation’s Gross Domestic Product (GDP) from manufacturing and about 23.6 per cent from the service sector.
The country’s manufacturing output, as well as its exports, is accounted for by SMEs. According to data for the fiscal year 2016-2017 gathered from independent yet reliable sources, their fixed assets total Rs.14.719 trillion.
Though these figures are impressive, SMEs cannot persist as SMEs indefinitely. Therefore, they must continue to grow in the coming years and become major players. In rural areas, small, traditional businesses are often successful and cater to only local demands for specific products and services.
There exists a tremendous growth potential for SME businesses in India given its geographical location and that 40% of its products are exported. In small business growth, digital marketing is key. Now You can easily set up an LLC in Wyoming. Digital marketing plays a role in small business growth for many other reasons as well.
Why Digital Marketing is Important for Small Business Growth?
What are these top reasons why digital marketing is important for small business growth? There’re several. Therefore, let’s understand each one in detail.
Growth in Organized E-commerce Sector
India’s booming e-commerce sector will require about a million digital marketing jobs by the year 2022. The e-commerce sector will support over 20 million small and medium enterprises to build their businesses also, says PricewaterhouseCoopers, a global consultancy, in its recent report for India.
These figures are a clear indicator that digital marketing will be the main driver for these SMEs in the coming years. Unless they adopt digital marketing and create awareness about their company, brand, products, and services, these SMEs will miss the e-commerce boom the world is currently witnessing.
A lot of these SMEs now use third-party online retail platforms such as Amazon to sell their products. However, with millions of products listed on e-commerce portals, it often becomes difficult for a buyer to make a specific search. Hence, the brand or small business might never feature on search results on a large e-commerce portal and miss the opportunity to bag customers.
While selling adequate quantities of products or promoting a service on popular e-commerce portals may be fetching a fairly large number of clients to help the growth of small businesses, they have to eventually graduate into digital marketing on their own to create brand awareness.
Mobile Internet and Smartphone Proliferation in India
There’re projections that India will have over 442.5 million smartphone users by the year 2022- or in less than two years from now. There’re several drivers for this exponential growth. In 2019, the number of smartphone users in India was nearly half this figure.
What are the reasons for this growth of smartphone users in the country? A drop in smartphone prices is the main factor for this growing increase. If we look at any e-commerce website, a reasonably good quality Android-based smartphone is available for just below Rs.3,000. As a result, smartphones are now within reach of persons from the lower income group as well.
Added to this is the availability of economically priced data packs from mobile Internet and telecom services providers. For example, it costs just Rs.399 or lesser for anyone in India to avail of a Fourth Generation (4G) data pack combined with free calls and a specific number of SMS text messages for a period of 84 to 91 days, depending upon the service provider.
As a result, people in rural India now are also connected to the Internet. And they can access a variety of services through their smartphones.
Various reports suggest that about 70 percent of all e-commerce sales in India occur through mobile marketing, which are primarily smartphones. And this number is also said to be on the surge as mobile service providers improve their connectivity in rural areas to provide high-speed mobile Internet.
This is one of the top reasons why digital marketing is an important factor for small business growth. It can enable rural businesses that would depend upon local markets to now expand and grow into larger domestic and later, global markets as well.
Growing Popularity of Mobile Apps
The number of apps available for smartphone users in India is on the rise. We have apps from various organizations of the Central government. Then there’re apps from banks, Non-Banking Financial Companies (NBFCs), online retailers, transport providers, and almost every other service that exists in the country.
People use apps for a variety of reasons. This could be anything from applying for a service from the Central or state government online. Or to send cash for their relatives and friends. They’re useful for making investments as well as online purchases of goods of all types.
Most apps that are useful to people daily- such as news apps- usually sustain themselves through advertising. There’re countless businesses of all sizes in India that are using these apps to advertise their business through smartphone-based apps. And this is a market that’s an important factor for small business growth.
A small business usually doesn’t have an adequate budget to indulge inexpensive advertising campaigns on traditional marketing platforms such as print and electronic media, among others. In such a scenario, digital marketing provides the right solution for small business growth.
For a fraction of the cost of traditional or conventional advertising, a small business can engage in digital marketing and spread its ads through various apps. Since people usually use apps on the move, they enable quick decision making. Hence, a small business can grow due to instant sales that these apps can grab directly or indirectly, through proper advertising.
High Social Media Usage in India
With over 240 million Monthly Active Users or MAUs, Indians rank among the highest users of the social media platform, Facebook. Twitter, Instagram and Pinterest also have a considerable number of users in India. Therefore, social media presents an excellent opportunity for small business growth.
They can create an excellent social media presence for a very small cost to the company and promote their services to bag more customers. Social media marketing is an essential component of digital marketing and hence can play an important factor for small business growth in this country.
If you notice your Facebook page, Twitter, or Instagram account, among others, you’ll notice there’re several ads from all sorts of organizations that appear frequently. Often, some of these ads are compelling enough for us to ‘Like’ and share on our own Facebook Timeline or with friends and on groups.
The entire process of digital marketing using social media is known to be very effective. That’s the reason you’ll see some of the largest organizations in the world having excellent social media pages with interesting and relevant content for people to ‘Like’ and ‘Share’.
Social Media Marketing is an integral part of digital marketing processes and allows small businesses to create an awareness of their brand and product or service offerings almost instantly. Additionally, it’s also possible to customize when and where social media pages display your ads. A good Social Media Manager can help the social media page of your small business get thousands of ‘Likes’ making it very popular and helping growth.
Vast Talent Pool of Digital Marketers
India has a very vast talent pool of digital marketers, thanks to countless training institutes that are springing up across the country. And digital marketing training academies are always on the lookout for recruitment partners or businesses that can hire a fresher. This enables you to get a well-trained digital marketer for a reasonable salary or as an intern to promote your small business for growth.
Understandably, not every digital marketing training institute provides high-quality education in a very complex field. However, with some research, a small business can easily find out some of the best digital marketing training academies in the country and sign-up as recruitment partners. This way, a small business can recruit one or more digital marketers for their immediate and long term needs.
Though a fresher might lack the experience, they’ll be able to initiate or start making the presence of your small business, brand, product or service online almost immediately. And with some experience, these fresher candidates can develop as digital marketing professionals that can help in small business growth.
There’re several types of digital marketers available in the country. Some are available on a fulltime basis. Or you can easily enlist the help of a digital marketing company to promote your small business for growth. Their services aren’t expensive. And the amount of new business you’ll generate due to digital marketing more than justifies the small expense.
Using Multiple Digital Marketing Channels
Yet another top reason why digital marketing is an important factor for small business growth is the facilities to use multiple channels. This means, instead of using only one channel to promote your small business for growth, you can use a blend or several others as well and get a better growth rate.
Let us take a glance at some of the various digital marketing channels for small business growth.
The first one is a blog. It’s very simple for any small business to open a free blog or buy a matching domain name and web hosting to launch a very professional blog. A lot of purchases occur because of blogs. In fact, the majority of consumers nowadays prefer to make decisions based upon blogs as compared to paid advertising. Because they consider blogs as informal media.
A sort of blog post that features on a business website or an independent one is usually taken more seriously than a conventional advertisement. That’s the reason why a lot of large corporations also have blogs for their brand and product or service range.
The second channel is affiliate marketing. Countless bloggers around the world engage in affiliate marketing and promote products and services of various companies. In exchange, they get a small commission that can range anything from two percent to 28 percent, depending upon the product and the company.
The third channel is YouTube or video marketing. A small business can grow immensely simply by opening a free YouTube channel and posting excellent videos. A small business can provide videos of real-life stories and experiences with their products that people can relate with. And promote them via social media and other platforms as well.
Anyone Can Learn Digital Marketing
There’s one more hidden benefit of digital marketing for small business growth. And that’s the easy availability of excellent digital marketing training courses in India. What’s the hidden benefit here? A small business owner can also do an excellent part-time digital marketing course and dispense with the need to recruit someone or outsource the process.
Furthermore, spouses of small business owners or their teenage children can also learn digital marketing and help grow the organization. This can help save costs on recruitment or outsourcing digital marketing services while ensuring that your small business grows.
Or, a small business can send staff to take a digital marketing course during their spare hours and especially weekends. It is well known that organizations that provide newer skills to their employees have lower attrition rates.
Create Major Impact Over Competitors
If we look at some of the major success stories of small businesses in the world, it is clear that digital marketing played a key role. Some examples are Amazon and Airbnb, among others. These companies started small and in fact, with very minimal infrastructure or investments.
However, digital marketing is helping these companies retain that leading edge over their rivals in the business. Here I’m not implying that your small business growth would propel you to heights of Amazon or Airbnb and their likes immediately. However, over a period of time and with proper digital marketing, it can play a very important factor in small business growth.
Enter Newer Markets
Another excellent reason why digital marketing is an important factor for small business growth is the ability to rapidly enter newer markets. Your small business can leverage the power of social media ads, Google AdSense, blogs and affiliate marketing among other resources, to create brand awareness in these new markets at a minimal cost.
And once you get an excellent response from these digital marketing techniques, it becomes easier to enter the newer market and watch your small business grow exponentially. This can take some time but with proper digital marketing, it’s achievable.
In Conclusion
As we have seen, these are the top reasons why digital marketing is an important factor for small business growth. It goes without saying that the future is digital. Hence, it’s vital for every small business to implement digital marketing as part of their overall growth strategy for the future. Else, they may have to go out of business, as Bill Gates famously says.