The SME online revolution

Mark Harper_Suncorp.jpgThe buying patterns of consumers have changed since the advent of the Internet, with traditional retailers getting left behind as people flock to online shopping.

Mark Harper, the Executive Manager of Business Lending Products at Suncorp, discusses how small businesses can take part in the online revolution and drive their revenue growth.

 

The last big technological revolution in business was the humble computer. The computer revolutionised business by automating many repetitive and time consuming functions, lowering business running costs, improving productivity and providing modern managers with critical information at their fingertips and in real time.
 
The current revolution underway for SMEs is much more profound - the internet.  The internet has been part of our modern society for at least 15 years. And according to the Australian Bureau of Statistics, more than 89% of households with children now have a computer at home with broadband access.

While many people use the internet daily for work and education, most also use it for personal pursuits including email, banking, gaming, social networking and increasingly, online shopping.

Consumers are flocking to online shopping for many reasons, including:

  • Easy access - shopping can be done almost anywhere including the living room or office.
  • Convenience - parking, traffic and shopping queues are avoided.
  • Better deals - cheaper prices are often available online and products and services can be researched and compared more easily.
  • Variety - a greater choice is often available online compared to in-store.

As more and more consumers and businesses go online to research products and services, make purchases and share feedback and reviews of their shopping experiences, what are the implications for SMEs?

Cutting-edge SMEs see the internet and the growth in online shopping as an opportunity to drive revenue growth and provide efficiency gains. Some of the ways you can achieve these objectives are outlined below.

Revenue growth

  • Expand your distribution reach by selling products and services online to consumers and businesses you could not reach with shopfronts.
  • Provide options for buyers to interact with you more easily, including the ease with which they can make complementary purchases from you (i.e. cross sales).
  • Develop a better understanding of buying patterns and segments within your customer base in order to provide tailored offers.

Efficiency gains

  • Lower operating costs by reducing your reliance on expensive shopfronts.
  • Utilise online marketing campaigns that provide a quantitative assessment of ROI - no more guessing games as to which advertisement brought in which customer at what margin - affording a lower marketing unit cost.
  • Seamless integration of shopping cart, merchant account, bank account, accounting package, and inventory control. ERP is no longer the domain of the multi-nationals! Online businesses don't need hordes of administrative staff, instead, you can focus your HR investment into sales and customer service.

Now that you've explored the opportunities of the internet revolution for SMEs, join me next time for my top tips on how to get your SME online.

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