With a large amount of India’s economic growth being fuelled by the SME sector, it is important that these businesses grow faster, be more productive and more competitive. And they can do this with technology. A 2013 global survey by the Boston Consulting Group (BCG), commissioned by Microsoft, draws a clear correlation between the aggressive adoption of new technology by SMEs and strong business performance. In an conversation with Rajiv Sodhi, Vice President, GoDaddy, India and Australia, Faiz Askari, Editor of SMEStreet found key market insights and trends that are influencing India’s SME sector.
What are the key differentiation between Indian SMEs and SMEs from the developed countries?
One key differentiator that sets Indian SMEs apart from their counterparts in the developed nations around the world is technology adoption. While India is home to over 51 million SMEs today, only 20 percent of India SMEs (about 10 million) are considered technology-ready – just 500,000 have a website and a meagre two million have access to the Internet.
The report points out how small businesses that adopt new technology early on, outpace other SMEs in revenue and job growth, and even tend to grow well above the rate of GDP growth in their country.
To help Indian small business owners, education on the benefits of bringing their business online can help with bridging the gap.
How is GoDaddy targeting this segment in India? What is the prime focus for the company?
When it comes to India, the potential for GoDaddy clearly lies among the country’s countless SMEs. We believe that SMEs will lead the charge for the Internet in India. It is our mission to radically shift the global economy toward small businesses by empowering people to easily start, confidently grow and successfully run their own ventures. With more than 13 million customers worldwide and 60 million domain names under management, GoDaddy gives small business owners the tools to name their idea, build a beautiful online presence, attract customers and manage their business.
Our aim in India is to educate small businesses on what the Internet can do for them. Our strategy is three-pronged and we are focused on:
- Educating small businesses on how easy and affordable it is to get online and the benefits of getting a website.
- Continuing to improve our products and services by keeping them easy-to-use and affordable
- Providing expert customer care through our 24/7, local customer care centre serving small business owners in India, from India
What are the key challenges that you are facing in order to tap or do business with this segment?
The market here in India, despite the immense potential, is riddled by lack of access, awareness, and adoption. Lack of ‘awareness’ is a major issue. Most Indian businesses, especially the SMEs, are saddled from the ‘Not-for-me’ syndrome, and that the Internet is only meant for big brands or firms. That becomes a challenge for companies like us.
Then comes the fact that people think that buying a domain name, setting up a website, moving to social media and all are very complex.
The third challenge is the concerns which are related to ‘pricing’. As you know, that India is usually referred to as a price sensitive market, the truth is that it’s not price sensitive, but value sensitive. So people have money to spare, but they will not spend if they are not clear about the value it will give.
To add to this, India is a ‘Do-it-for-me (DIFM)’ country unlike western countries, which are more in the Do-it-Yourself (DIY) mode. This has huge implications on what we are trying to do.
What are GoDaddy’s line of action for next one year for SME segment?
In addition to bringing quality products, tailor-made as per the needs of Indian SMEs, GoDaddy is dedicated towards driving massive awareness about the ease and benefit of coming online. Our belief is that as long as we keep reaching out to people in a manner they understand and in a language they understand, the challenge of generating awareness can be tackled. We recently did campaigns with famous personalities like Mithun Chakraborty to help spread our message. Going forward, we will do marketing campaigns in local languages because we know that people who’re coming online are not from metros and are not always English speaking people. We recently launched our first regional marketing campaign in Tamil, and we are in the process of launching more such campaigns in future.
We are addressing the challenge of affordability by offering products that are both reasonably-priced and useful for small businesses. So today, for as little as Rs 99 a month (with an annual purchase), a small business owner can get a domain name, website, and professional email as part of GoDaddy’s Get Online Today package. For as little as Rs 999 a month (with an annual purchase), SMBs can set-up a fully functional ecommerce website with little or no technical knowhow using GoDaddy’s Online Store.
Also, since India is a DIFM market, one needs support. For that, we ensure that we provide 24/7 free customer care for our customers. In order to assist our customers in their language, we now have local language customer care in over 6 Indian languages and are in the process of adding more.
So we are trying to make sure that people know it’s easy, fast and simple. We are trying to build local bundles that bring our solutions together so the number of steps for customers is cut down.
How are cloud solutions getting consumed in this market?
As mentioned earlier, SMBs in India vary widely in their adoption and use of technology, especially when it involves latest technology tools such as cloud computing. Smaller businesses also have smaller teams, making it essential that these teams be more productive through the day. Mobility will play a key role in their success, which makes cloud technologies a significant draw-allowing SMBs to access their business data anywhere, anytime and across devices to be able to make meaningful decisions, even on the go.
With an increase in access and awareness, we are witnessing more and more small businesses adopting cloud solutions that help them better compete with larger businesses.According to a study by Nasscom and Frost & Sullivan, SMBs are expected to spend about $18.5 billion (Rs 1.11 lakh crore) on information technology by FY18, driven by growing adoption of cloud and mobility solutions as compared to about $8.7 billion (Rs 47,200 crore) on IT in FY13.
For small business owners, having the ability to create their digital presence and manage their business online in a cloud environment, means that they can run their business and connect with their customers more easily and when on the go.