In 2023, digital technology will fuel the recovery of small and medium enterprises (SMEs), with several promising trends expected to benefit the involved parties.
One such trend is widespread digital transformation, especially given how many mediums there are for digital activation. For instance, mobile phones are generally common and easily accessible in the digital age, making it easier for consumers to reap the benefits of modernization. Per data from the World Economic Forum (WEF), the global mobile device user base is predicted to grow from 6.38 billion in 2021 to 7.52 billion in 2026.
These statistics indicate that digital transformation will continue accelerating in the coming years, mainly due to tools like mobile phones. Because of this, SMEs who activate online will be able to connect with more people, effectively driving their recovery.
Aside from this, consumer trends are ever-changing, and digitalization has played a significant role in recent years. Although physical shopping is gradually re-establishing its importance as a consumer trend, many see online shopping as having a considerable part in the future of the retail industry. According to an industry report, the global e-commerce business will rise from its current value of $3.3 trillion to $5.4 trillion in 2026, an increase of more than 60% in four years.
Thus, SMEs should activate via e-commerce platforms while maintaining a physical presence. This will enable an omnichannel approach, but more importantly, it connects SMEs with a larger audience– potentially creating a global reach.
In close relation, an emerging consumer trend is consumers desiring a personalized experience. A survey conducted by an advisory firm specializing in e-commerce revealed that approximately 75% of consumers, across a sample size of participants from 10 countries, prefer buying from websites in their native language. Moreover, 60% of respondents rarely or never buy from English-only websites.
Moving forward, SMEs have a unique opportunity to create a personalized consumer shopping experience where the end goal is creating a sustainable seller-buyer relationship. A personal customer experience will 1.) encourage domestic consumers to return to the SME’s business, and 2.) help build a business’ identity with the long-term in mind.
In the context of consumers and digitalization, the growing importance of online advertising will also become a relevant area of consideration for SMEs, especially entering 2023. Specifically, online advertising is becoming increasingly difficult for smaller businesses due to rising ad costs and competition. Moreover, it is becoming unsustainable for SMEs to engage in online advertising as ad space is dominated by competition with vast resources.
Instead, SMEs should develop optimized content that will perform well on social media platforms. For social media algorithms, video material is a crucial medium that performs well, so SMEs should learn digital skills for content creation’s sake. Given that business is only expected to integrate further with the digital world in the coming years, the digital upskilling of SMEs will help set a long-term foundation for smaller enterprises.
Overall, SMEs will have many trends to consider due to the rapid digital transformation of business and how it is conducted. While it may initially be challenging for SMEs to adjust, these digital trends carry many encouraging growth opportunities that stakeholders can leverage.
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