SMEs embrace the internet to expand business

Using Google AdWords, small and medium enterprises are leveraging the web effectively to generate online sales and grow faster

When Veena Singla returned to Chandigarh after a long stay in Australia, she realised there was a dearth of good bakeries in the city. The result was Zesty Bites, which she started in 2004. Since her customers were increasingly researching online before buying cakes, she launched her website a year ago, started using Google AdWords, and witnessed a 20-25 per cent increase in business. Her bakery is now a well-recognised brand in the city.

Similarly, Punjab-based Precision Machines & Automation (PMA), a manufacturer and exporter of carton folding machines, carton gluing machines and a variety of other machines, started using Google AdWords in September 2012, to expand business and build awareness.

Google AdWords allows enterprises to showcase advertisements to users who type in keywords related to the products or services they offer. Since the keywords enable inquiries to be made more specific, the conversion ratio and profitability improved, and PMA expanded its reach beyond Punjab.

Zesty Bites and PMA are among the five to six per cent of small and medium enterprises (SMEs) that are leveraging the Web effectively to expand their business and generate online sales. According to new research conducted by Zinnov on behalf of Google, India has over 48 million SMEs, of which eight to 10 million can grow quickly by advertising online.

India has over 250 million-plus internet users and is set to overtake the US in 2015 by reaching 350 million internet users, indicating the potential.

Says Singla, proprietor, Zesty Bites, "Earlier, my products were sold through word of mouth, and my business was restricted to the tri-city - Chandigarh, Mohali and Panchkula. I launched my website a year ago and adopted Google AdWords six months back. Now our daily order size has increased significantly and we are getting orders from far-off places like Amritsar, Jalandhar and Bathinda in Punjab, and Panipat, Karnal and Ambala in Haryana. We have witnessed a 25 per cent increase in business with the adoption of the internet."

Vaibhav Sharma, PMA's CEO, said, "We started using Google AdWords in September 2012 and it helped us improve online sales, generate new leads and increase visibility. It has helped us expand our reach beyond Punjab, and our conversion ratio and profitability are now high."

However, unlike Singla and Sharma, the majority of SMEs in India have ignored the potential of the internet to facilitate faster growth and expand their horizons. Owing to a lack of awareness of the benefits of the internet; lack of know-how, skilled labour and other resources; and doubts about the return on investment, their adoption rate is slow.

Google recently launched a new product, 'Google My Business', which makes it easier for businesses to create an online presence even when they do not have a website, but manage it from their smartphones. It has been designed to work across both desktop and mobile devices, to help SMEs create and update business information on Google Search, Maps and Google+ from one place, free of cost, in both Hindi and English. It also enables customers to connect more easily with local businesses when they search online.

Suryanarayana Kodukulla, head of SMB sales, Google India, said, "As part of our Digitising India mission, we are introducing this new mobile-based product to help Indian SMBs create and manage their internet presence and connect with potential customers online. In addition, to tackle the challenge of lack of awareness of the benefits of the internet, we are partnering with CII to help create awareness among SMBs to accelerate the adoption of the internet."