Embracing digital marketing is the way forward for MSMEs

Many business owners in this sector Mare unfamiliar with the intricacies of online advertising, SEO, content marketing, and social media strategies. This lack of knowledge often leads to scepticism and reluctance to invest in digital marketing initiatives

In my last two articles I have dwelt on the two of the major challenges that confront MSMEs on their path to realising their full potential and optimise their contribution to the national economy. Easier, faster, and adequate availability of credit is one of them and so is a compelling need to reassess their strengths and reassert their salience.

In this article, I intend to discuss yet another dimension that they must embrace to overwhelm the landscape that they presently straddle.

There is no way that MSMEs (above all the micro enterprises) can progress without wholeheartedly taking to digital marketing. As has been rightly said, digital marketing can entirely remodel the way Micro, Small & Medium Enterprises (MSMEs) engage and connect with their customers. In essence, it allows MSMEs to adequately put their brand in front of their target audience at the right place and time – cost-effectively and measurably.

Multiple challenges:

Digital marketing is a transformative force, reshaping how businesses engage with their audiences, jettisoning the previous mindset and fixation on conventional marketing. Yet, despite its undeniable benefits, several challenges and mental blocks hinder the widespread adoption of digital marketing among Indian MSMEs.

Limited awareness and understanding:

One of the primary challenges is the limited awareness and understanding of digital marketing strategies among MSMEs. Many business owners in this sector are unfamiliar with the intricacies of online advertising, SEO, content marketing, and social media strategies. This lack of knowledge often leads to scepticism and reluctance to invest in digital marketing initiatives.

Resource constraints:

MSMEs often operate on tight budgets and have limited resources compared to larger enterprises. They may perceive digital marketing as an expensive endeavour requiring substantial financial investments in technology, talent, and tools. This misconception can deter them from exploring the cost-effective avenues that digital marketing offers.

Fear of change and tech adoption:

Resistance to change and the fear of adopting new technologies can also impede the adoption of digital marketing. Some MSME owners may feel overwhelmed by the rapid pace of technological advancements or fear disruptions to their existing business models.

Perceived complexity and time investment: Digital marketing strategies, such as search engine marketing, content creation, and social media management, require time, effort, and expertise. MSMEs may find it daunting to navigate these complexities while managing day-to-day operations, leading to procrastination or half-hearted attempts at digital marketing.

Trust and Credibility Concerns: Building trust and credibility online is crucial for the success of digital marketing campaigns. However, MSMEs may question the effectiveness of digital channels in reaching and retaining loyal customers compared to traditional methods they are familiar with.

A digital future:

Despite these challenges, the imperative for Indian MSMEs to embrace digital marketing cannot be overstated.

Here are some compelling statistics highlighting the growth and impact of digital marketing globally and in India:

According to Statista, global digital advertising spending is projected to reach $517.5 billion, indicating the growing dominance of digital channels in the advertising landscape.

In India, the digital advertising market is expected to grow at a compounded annual growth rate (CAGR) of 32% between 2021 and 2026, as reported by DigiMANTHAN.

A study by Deloitte India and the Indian Chamber of Commerce (ICC) revealed that MSMEs leveraging digital technologies experienced a 51% increase in revenue and a 49% increase in profit margins.

Government initiatives:

For the past several years, the government has been emphasising on the need MSMEs to take to digital way of functioning in every aspect of their operation. The ’Digital MSME Scheme’ aimed at making MSMEs digitally empowered and motivate them to adopt ICT tools and applications in their production and business processes to improve their competitiveness in national and international markets.

A more omnibus ‘Procurement and Marketing Support (PMS) Scheme also include encouraging digital marketing. In a way, t is essentially an empowerment scheme for MSMEs. The results have been mixed. A rethink is required ensuring that digital marketing becomes their first choice.

A comprehensive strategy where MSMEs must become the prime movers and the state offering a strong supporting framework demands a priority as never before. The many proactive steps that demand urgency include,

Education and training: MSME owners and employees should undergo training programs and workshops to enhance their understanding of digital marketing concepts, tools, and strategies. Government initiatives, industry associations, and digital marketing agencies can play a vital role in providing education and guidance.

Cost-effective solutions: Emphasize the cost-effectiveness of digital marketing compared to traditional advertising channels. Showcase success stories and case studies of MSMEs that have achieved significant growth through targeted digital marketing campaigns on a limited budget.

Collaborative partnerships: Forge partnerships with digital marketing agencies or consultants who specialize in working with MSMEs. These partnerships can provide access to expertise, resources, and tailored strategies that align with the unique needs and constraints of MSMEs.

Pilot projects and proof of concept: Start with small-scale pilot projects or proof-of-concept initiatives to demonstrate the effectiveness of digital marketing. Monitor key performance indicators (KPIs) such as website traffic, lead generation, and conversion rates to showcase tangible results.

Community engagement and peer learning: Encourage peer-to-peer learning and knowledge sharing within MSME communities. Organize forums, webinars, and networking events where successful digital marketers from the MSME sector can share their insights, strategies, and best practices.

By addressing these challenges and leveraging the vast opportunities offered by digital marketing, Indian MSMEs can not only enhance their visibility, reach, and customer engagement but also drive sustainable growth and competitiveness in the digital age.

Embracing digital marketing wholeheartedly is not just a choice but a compelling necessity for MSMEs aspiring to thrive in today's dynamic business environment.

(The writer is a former MSME secretary, Government of India)