A recent study undertaken by Google India finds that over 40 percent of Small and Medium Enterprises in this country with websites, use the Internet for advertising; 43% percent of SMEs spend between Rs 1.2 to Rs 2.5 million on advertising; 81% SMEs have benefited and have seen increase in customer base from Internet advertising; 56% feel that Internet advertising is very cost effective.
The study which covered 785 SMEs (owners or marketing heads) across India including Mumbai, Delhi NCR, Ludhiana, Kolkata, Bangalore, Chennai, Coimbatore, Hyderabad, Ahmedabad, Surat, Cochin, Pune, Nashik and Nagpur, found that SMEs from services, manufacturing and export vertical are the most active in online advertising with over 65% using search engine marketing.

While accessing email is the #1 purpose for using the Internet, a majority of SMEs 71% also use the Internet to search for vendors and suppliers and about 40% of them use the Internet to create online listings and advertise online. Traditional media like newspaper ads and outdoor ads still lead the advertising spends for SMEs, but Internet is emerging as one of the fastest growing medium for advertising with 58% of SMEs with websites using the Internet to generate business leads.


Says Sridhar Seshadri, Head of Online Sales Google India “While the absolute number of SMEs with an online presence is very low compared to actual businesses in India ( 2 million out of some 35 million) , we’re pleasantly surprised to see increasing understanding amongst Indian SMEs to use the web for business growth. In the last two years we have seen a significant increase in the number of businesses that have started to advertise online. Google India is working on a number of programs to educate more SMEs on how they can get online and use the Internet as a primary sales channel”.

SMEs from Insurance, Technology B2B, IT Hardware, and Travel & Tourism spend around 30-45% on online marketing. Annual average online spends are high among SMEs from Media & Entertainment, Gems & Jewellery and Apparel. Additionally, Banner/Display Advertising and Email Marketing are the most popular form of Internet advertising and 30% SMEs use search engine advertising to market their product and services.

K.G Sajith, Managing Director, of Web development and marketing provider, ISPG Technologies, Kochi, ( www.ispg.co.in  ) shared his experiences in helping many start-ups see their businesses grow exponentially, riding on the back of carefully strategized Net advertising and marketing, particularly in the travel, tourism and hospitality sector, where Kerala has been a leader.
Feb 18 2011