The worlds most powerful internet company, Googles focus on small and medium businesses (SMBs) has not been new. Be it opening call centres to help SMBs or offering reasonable advertising ratesthe Mountain View, California-based company has encouraged businesses like Aryan Florists in Punjab and Joysen Tatto Studio in Hyderabad to advertise online.
Just a fortnight back, the grand announcement of Google to bring 5,00,000 SMBs online in the next three years raised questions as to why the internet behemoth is so bullish on this segment and making heavy investments too. Google introduced Google Apps for Businesspowerful messaging and collaboration toolsin India two years back and already has 2,00,000 SMBs as its customers for these cloud services. Industry analysts believe that SMBs is the perfect market for Google to tap customers for Google Apps. While Google encourages SMBs to be online, who knows tomorrow they could advertise online and use their apps as well.
Rajan Anandan, managing director, Google India and vice-presidentsales and operations says, Since the launch of our Get Indian Business Online campaign, 25,000 SMBs have already built and published a website. Everyday, we are adding 1,000 SMBs online. It is important for us to have SMBs online so that we can expand the ecosystem.
But there is definitely a difference in the kind of SMBs coming online in the last 20 days. These businesses are even smaller than what customers we had previously and are also from smaller towns. But we are seeing interest across all industries from manufacturing to financial services; it is not just retail and travel which is driving this phenomenal response, he elaborates.
Among the category of businessesservices (banking, financial services and insurance, travel, technology), manufacturing (IT hardware), exporters of apparel and gems and jewellry are the most active in online advertising with over 65% using search engine marketing.
The India SMB challenge
With 100 million internet users in the country, India is the 3rd largest internet market in the world. The country has an estimated 8 million SMBs, which can immediately gain from the power of the internet but only about 5% of these entities have a website or some sort of Web presence.
Rajan says, The reason for SMBs not having decent websites is lack of awareness and lack of understanding. Today companies have been able to increase their revenues by 30-40% year-on-year by being online. We are building websites free of cost for SMBs which would otherwise cost them R25,000.
In the bigger picture, the Indian advertising market is $5.5 billion, which is 1/6th of China. Also, the online space comprises hardly 10% of the total advertising market in India. Within this, most SMBs do not have the budget to even give print advertisements.
But the good news is that online and mobile advertising is easy and economical. Our view is that India will have many first-time advertisers on mobile and internet, says Rajan. As per Google, 6,00,000 SMBs advertise on television and 16,00,000 on radio. Of the combined 22,00,000 SMBs, more than half of them only advertise on internet.
An analyst who tracks Google says, Unfortunately, we do not see other brands like Yahoo! or Microsoft very aggressive on the SMB front as they do not offer any specific solution for this segment. Googles initiative has been strategic as the company needs to promote Google Apps and treasures its business from Google Adwordswhich is again driven by SMBs.
Partner plan of Google
Being an MNC, it is difficult for Google to reach the smallest businesses in smaller towns and thus it has initiated the reseller model. These resellers promote Googles initiatives in small towns and companies. KG Sreejith, directorsales and marketing of ISPG Technologies, a Kochi-based partner agency of Google India says, We have been working with several local businesses in Kerala who have been successfully using Google AdWords platforms to promote their businesses. There is a huge untapped opportunity which exists on the internet for businesses in Kerala. With the launch of the export tools we are also able to help several local businesses in Kochi who are looking to tap international markets for their business growth.
Google India launched the Google Global Market Findera free online tool for advertisers to find new markets overseas. The new tool is designed to help Indian businesses expand their business and reach out to potential customers in the international markets. This tool will be available as part of Google Ads for Global Advertisers, a new website and hub for businesses to identify, reach, and engage with customers worldwide.
Another partner agency of Google India is Pensa Media, offering services in Punjab and Rajasthan. Its founder Neeraj Khanna says, Reaching out to customers beyond boundaries, better measurability, precise targeting has got more and more SMBs joining the digital media bandwagon. With more than 53% of internet penetration growth coming from cities with population less than one million in India, SMBs are certainly the most benefited. He explains that his company has been working with local businesses in Punjab and has now extended the reach to service entrepreneurs in Rajasthan too.
As Google continues to build the ecosystem, it will be intriguing to see how the internet behemoth benefits out of this.