• Only 14% of Irish SMEs have online initiatives planned for the festive season;
• Staggering 1 in 4 SMEs still without a website or any online presence at all;
• Despite slight improvement for SMEs on IEDR’s “Digital Health Index”, further investment in digital presence is vital.
The full IE Digital Health Index Report is available here.
Irish shoppers are expected to spend €100 million (or €4 million an hour) on Black Friday, but only 35% of Irish SMEs with a website can process payments online and only 42% can take sales orders online, according to new research undertaken by the IE Domain Registry (IEDR).
Just 14% of Irish SMEs plan to conduct any online initiatives, like special offers and promotions, for Black Friday and the festive season. In addition to Black Friday, recent research indicates that 1 in 3 Irish consumers intend to buy online on Cyber Monday.
IEDR’s “IE Digital Health Index”, compiled in three waves of research in May 2014, December 2014 and September 2015, measures the health of Irish SMEs’ digital presence by analysing the number of digital assets (like websites, apps and social media accounts) owned by them, and their perceived quality. Its findings highlight an alarming number of SMEs lagging behind in the digital space.
Shockingly, as many as 1 in 4 Irish SMEs still do not have a website, or any online presence whatsoever, to list products or conduct e-commerce transactions with their customers.
Surprisingly, 3 in 4 of these respondents said they did not intend to build a website, with a majority saying that there is “no need” within their industry.
Almost half of SMEs surveyed (46%) don’t advertise their services at all. Of those that do, 1 in 4 use traditional advertising media, while 1 in 6 use digital advertising. The latter figure is expected to grow, with 1 in 4 saying that they are spending more on digital advertising now than in the past.
Despite these factors, Irish SMEs are positive about their businesses. 6 out of 10 expect their revenues to increase over the next 12 months. Social media use amongst SMEs has improved over the period December 2014 to September 2015. The number of companies with a Facebook page has grown by 16%, from 44% to 51%; Twitter has grown by almost 47%, from 15% to 22%; while the use of LinkedIn has grown by 100%, from 8% to 16%. For SMEs with websites, optimisation for mobile browsers has increased by 37% year-to-date.
David Curtin, Chief Executive of IEDR, said that while Irish SMEs have marginally improved on the IE Digital Health Index, from 42.0 to 43.4 since December 2014, a great deal of work remains to be done.
“The IE Digital Health Index highlights some alarming figures, in particular the statistics relating to e-commerce capability. Less than half, or 42%, of Irish SMEs can take sales orders online, and an even smaller number, just over a third, or 35%, can process payments online.
“In 2014, Irish consumers spent almost €6 billion in e-commerce transactions. At the moment, only a tiny amount of this is spent in Ireland, with most consumers purchasing products from stores in the UK and Europe where digital marketplaces are more commonplace and accessible.
“By 2020, the value of Ireland’s digital economy is expected to more than double to 10% of GDP, or €21 billion. Our own SMEs risk being left out of this commercial revolution if investment in their online capabilities remains low.
“Indeed, a staggering 1 in 4 Irish SMEs have no online presence at all, and 3 in 4 of those SMEs have no intention to establish one. Every business, regardless of industry, can benefit from a website, or at the very least a business focussed social media account. A website can act as a calling card, a mission statement, a shop front and a digital marketplace, so there are huge opportunities to broaden customer bases and open new revenue streams.
“28% of the IE Digital Health Index respondents said that the lack of technical ability and financial supports are holding them back from transitioning online and engaging in e-commerce. To this end, IEDR runs the OPTIMISE Fund. Over the past five years we have awarded close to three quarters of a million euro worth of shoulder-to-shoulder website development and training services to 75 Irish SMEs and micro-enterprises looking to improve their digital presence and engage in e-commerce.
“Solving this digital crisis in the long term requires a combined effort from the Government, industry organisations and Local Enterprise Offices (LEOs) and business leaders. There is a dire need for SMEs to receive support for web design and e-commerce education initiatives, mentoring services, enterprise funds and improvement of Ireland’s broadband infrastructure,” said Mr Curtin.
The below infographic details some of the key findings of the report:
The full IE Digital Health Index Report is available here.
