In this current climate as we are all going through recession, you would think many business are going online to cut cots, and take advantage of online sales, but that’s not the case.
A recent report shows that while 80% of SMEs have a website only 3% use it to interact with their customers. Furthermore, only 18% of SMEs see online as crucial to their marketing strategy.
When journalist Helen Loveless of the Daily Mail recently covered the Voice of SME report, she quoted Stephen Alambritis, chief spokesman for the Federation of Small Businesses "in a tough economic climate, experts believe it is increasingly important that small firms look to the Internet to help sustain and expand their business."
Alambritis isn't the only one sending this message out, another recent article in Business Wire reported businesses that do not embrace the online revolution are up to 30% more likely to fail.
What SMEs are missing is the fact that the value of online retail shopping has risen from £46.6bn in 2007 to £53.2bn in 2008 (Source: Business Wire), and that, at a time when the number of high street retailers shutting shop is ever increasing - which means that the money is online. Plus, the cost of running a business online is far more cost-effective than on the high street but this too has escaped the majority.
The recession is also having a major impact on consumers, who are going online to find bargains, chat and browse the web. The result is that a large proportion of SMEs are losing out in terms of revenue simply because they aren't embracing the opportunities online holds for them.
Our report showed that while 60% of businesses are not selling their wares online, more than two thirds (69%) shop online at least once a month. This is interesting - because it shows that when it comes down to it, it's all about attitude and perception.
As people and individuals, we are open-minded about what we can do online - so activities like shopping, chatting, blogging, video are all easy enough to do. Yet when you turn tables and we come to using the same mediums for business - we start to see risk and become wary.
It's not just money that online has to offer small businesses. It's about building an identity that lasts, making connections that help businesses to expand not just locally but globally. It's about being able to offer good customer service at little or no cost and most importantly, it's about establishing a relationship with your customer like never before.
Consumers are becoming more clued up and powerful when it comes to buying. It's no longer just about the product, trust is a key element that can sway the buying decision and online offers SMEs a channel to build trust and make relevant lasting relationships.
But whichever way the debate goes, with current forecasts predicting that by 2011 32m UK consumers will be shopping online (Source: Forrester,UK eCommerce Forecast 2006-2011, March 2007) there's no question over which way the money and the consumers are headed - online.
Question is, are you going to jump online and make your presence known or wait for someone else to do it before you.