In 2012 its amazing to still learn that many businesses are yet to embrace online as part of their marketing and sales strategy. A recent survey by Hunter Valley Research Foundation revealed that many Hunter businesses are not embracing the digital economy with rates of taking orders via the internet remaining very low and 42.7% of businesses having no website.
Contrast those statistics with a new survey report released today by American Express showing those who have embraced e-commerce are 33 per cent more likely to have reported a profit increase in the 2011-12 financial year.
Here is the full media release. I have highlighted significant points.
GOING ONLINE MEANS GOING STRONG FOR SMALL BUSINESS
Company website and Facebook page top marketing channels
One in three small businesses have made their products available for purchase online and those that have are reaping the benefits, according to a nationwide survey.
Commissioned by American Express among more than 1000 Australian small business owners, the survey shows that those who have embraced e-commerce are 33 per cent more likely to have reported a profit increase in the 2011-12 financial year.
Those small businesses who have introduced e-sales say it accounts for almost half (45 per cent) of their revenue and the majority (55 per cent) predict an increase in this type of trade in the next 12 months.
“Small business owners who have incorporated e-commerce into their business are seeing it as a worthwhile investment and appear confident of its long-term benefits. This comes at a time when having an online presence is becoming more and more important for small businesses. In fact, Australian business owners cite company websites and Facebook pages as the most effective marketing channels,” said Amelia Zaina, Head of Marketing and Customer Engagement, Small Business Services at American Express.
Social media drives revenue growth
The American Express survey also found that social media has helped almost one quarter (23 per cent) of small business owners to grow their business – and those that attribute business growth to social media are more likely to have reported an increased profit in 2011-12 (57 per cent) than those who don’t (35 per cent).
Small business operators who use social media believe it has helped them grow their business in several ways, including:
- Sourcing new customers (54 per cent);
- Raising brand awareness (51 per cent); and
- Generating new sales (40 per cent).
“These findings support the notion that small businesses who have gone online and are using social media, are seeing comparatively stronger revenue growth” Zaina said.
“While different channels work better for different industries, both e-commerce and social media can be innovative and affordable. Businesses can benefit in many ways to offset the impact of tough economic times on their business.”
Non-embracers reluctant to introduce e-sales
Despite the success of e-commerce, those who have not established an e-sales strategy are reluctant to do so, with only 12 per cent planning to sell their products and services online in the next 12 months. An even smaller number of small business owners (9 per cent) consider e-commerce necessary for future-proofing their business.
This reluctance can partly be explained by the significant proportion of respondents (40 per cent) who don’t find e-commerce relevant to their business – a view most prevalent among those in construction, finance, insurance and health and community services.
“Some small business owners also say they are not sure how to approach adopting e-commerce with their main concerns surrounding difficulties in setting up the payment platform and customer privacy issues. Seeking out information and advice on how to do this could potentially benefit their business and allay any concerns they may have,” said Zaina.
“Fortunately for small business owners, the internet offers limitless opportunities so even those who feel e-commerce isn’t right for them can make use of the online opportunities offered by social media to promote their products and grow their business.