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Indian SMBs to double Internet spending

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CIOL Bureau
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KOLKATA, INDIA: India small and medium are increasing their spending on Internet products and services.

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The overall spending on Internet and website-related products and services by India SMBs totaled US$1.45 billion in 2009, and this spending would continue to rise in 2010. In fact, Internet spending shows the highest year-over-year growth among India SMBs, when compared to the various ICT products and technologies, said a recent study by said a study by AMI partners.

Dev Chakravarty, assistant manager - Research, at AMI-Partners, India, “A majority of Indian SMBs have indeed reached saturation in terms of adopting basic connectivity infrastructure.”

 “Yet a considerable gap remains in terms of using technologies such as broadband, websites, Intranet, e-commerce, etc,” he added.

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It is surprising to find that more than half of PC-owning SMBs in India still do not subscribe to any kind of broadband service. Within the different Internet-access technologies, the most preferred lines by SMBs continue to be DSL and cable modem, the study noted.

The Internet is also viewed as "a key strategic focus item” for a majority of India SMBs.

“AMI’s recent study indicates that India SMBs are not yet satisfied with their present connectivity infrastructure,” said Chakravarty.

He further said that improving Internet or networking bandwidth/connection speed is the topmost priority of India SMBs in the next year. More than 70 per cent of businesses echoed these sentiments. This indicates that ISPs still have some way to go before they are able to provide the ideal broadband services to India SMBs.”

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In the past, digital social media, social networking, blogs, etc.; was being used for the most part by India consumers; yet we are seeing that more and more India SMBs have also started riding the digital bandwagon in a bid to be on par with their global counterparts.

The AMI survey shows that currently as high as nine-in-ten Internet-using SMBs in India use some kind of digital social media for business or professional purposes.

Professional social networking sites (e.g. LinkedIn) and general social networking sites (Facebook, Twitter) are the two most frequently used digital social media by Indian businesses.

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Internet-owning SMBs use these social media tools mainly for activities such as sales/marketing, keeping in touch with customers, advertising/business promotions and recruiting new employees.

One in four India SMBs have websites. For the most part these websites are hosted on third-party vendors’ or service providers’ servers. Many India SMBs have shown an interest in deploying their own websites within the next 12 months.

“Even if a fraction of these deployment plans are translated into actual practice, this entails a significant boost of website penetration within India SMBs,” noted Chakravarty.

For a significant proportion of India SMBs, the key purposes of websites are to provide information about their organization, provide products and service information/demonstrations and to quickly respond to questions from customers and prospects.

The website can act as a very useful marketing tool for India SMBs since it enables them to transgress the national boundary and showcase their capabilities to a wider potential customer base throughout the globe–at a negligible cost compared to traditional marketing methods with a large sales force.