Digital innovation can be a boon for small-business owners, but only if they know which advances will serve them best. Here, four experts reveal tools many SMEs can use in the coming year.
There is no doubt that digital transformation is essential to small-business success today, and that embracing technology is the way forward. However, there are so many different software packages, apps and high-tech solutions, which ones should a small-business owner, with more limited financial and human resources, focus on for the best results? Four experts share their insights into the best strategies for the small-business technology landscape in 2022.
Alex Frolov, CEO and co-founder, HypeAuditor
Entrepreneurs and small businesses are increasingly turning to influencer marketing, rather than advertising, due to its ability to reach new audiences and generate a return on investment 11 times higher than traditional methods. COVID-19 and the multiple state-wide lockdowns escalated the trend throughout 2020, as consumers were buying more from local brands. The pandemic has also shifted consumer habits, as people spend more time online and use social media platforms more than ever to make their purchasing choices.
In a NewsCorp survey, 43 per cent of Australians said they engage with brand content at least daily, with 84 per cent taking some form of action – buy, share, follow, or save. And 34 per cent purchase a product after engaging with a recent piece of brand content.
Small businesses are increasingly recognising the potential of influencer marketing, especially as they typically don’t have the big marketing budgets larger brands usually have. It’s never been more apparent than it is now – with the global pandemic and resulting restrictions and the economy in flux – that influencer marketing presents a unique opportunity for small businesses to connect with and attract their ideal consumers, for a fraction of the usual advertising price tag.
Mark Perry, Chief Customer Officer, Biza.io
The Consumer Data Right is the trojan horse for small businesses. In 2021, we really saw the CDR ecosystem come to life and many more major developments in 2022 will bring its benefits to everyday Australians and SMEs. Whilst we’re still in the early stages of the rollout, forward-thinking, smaller organisations should start to look at how they can use CDR to jump up the next couple of rungs and increase their competitive advantage.
One of the major benefits is the ability to make easier product comparisons. This could give more people an incentive to switch to smaller providers, encouraging competition in the marketplace.
Right now, the banking sector is leading the way with CDR. For example, small businesses can already benefit from simpler and faster loan-application processes and will eventually be able to manage all their finances in one spot, giving small-business owners more critical time to focus on the day-to-day.
For many, getting familiar with the CDR and how it’s relevant for them can seem a little daunting, much like cloud or eCommerce. Early adopters are going to stand out from the pack. In 2022, small-business owners who begin to plan around how the CDR can provide them with an upper hand will most certainly be better off in the long run.
Jasmine Workman, Senior Marketing Lead APAC, Shopify
Historically, it has been challenging for small businesses to access the global online marketplace, due to the complexity and cost of technology for international commerce and the global data insights required to be efficient in multiple markets. Now, however, exciting technology is fast-evolving and opening international markets for small businesses.
Gaining access to international consumers is now possible through affordable and off-the-shelf retail operating systems. It’s important that small-business owners not let the challenges of the past two years limit their thinking or goals for the year ahead. The evolution of technology means small retailers and online merchants can now easily be part of the eCommerce boom in multiple languages and currencies, with local domains and automatic SEO optimisation, and with local duties and import taxes already managed on their behalf.
Furthermore, small-business owners can now clear the previously overwhelming hurdle of simply not knowing what customers in another market want. By leveraging online eCommerce ecosystems and communities, a local merchant based in regional Australia can easily gain access to aggregated data and analysis of millions of merchants around the world. Without requiring a physical presence overseas, local entrepreneurs can use the same platform that addresses their local customers’ needs to learn about customers in hundreds of other countries.
The biggest priority for small businesses when it comes to technology is thinking big. Don’t hold back from taking a global lens to your business, and don’t assume that international expansion will come with a heavy price tag. By letting technology do the heavy lifting, even solopreneurs can reach customers all over the world.
Alex Macoun, chief of strategic operations, SiteMinder
Data has always been critical for success in small business. In the past, it might have been the daily till reconciliation or that shop-front employee who recognised every loyal customer; today, it’s increasingly in CRM systems and online-reporting solutions. In 2022 and beyond, small businesses will be dealing with huge changes in operating environment and customer preferences as the world bounces back from COVID-19 and data proliferates, often in multiple disconnected systems.
In this ocean of data, small-business leaders need to identify the metrics that matter. The drivers of revenue could be website traffic, sales calls per week, or the percentage of repeat customers. You’ll also want to track costs, operational effectiveness, and customer-experience metrics. From there, you can identify two things: the leading indicators in your data that provide insights into how your business is likely to perform in the coming days and weeks, and the interventions that could improve performance. The shorter the gap between a trend’s appearance and the actioning of an intervention – such as increasing marketing spend, adjusting pricing, or ordering more stock – the better. Nimbleness is an advantage for SMEs.
The other good news is that the tools and capabilities that only large businesses could access before are now increasingly available to smaller businesses, too. Software and online sales channels provide embedded reporting and insight tools, or the ability to export data to be combined with other datasets and analysed. These tools help businesses home in on what matters most, and can even provide some visibility of what’s happening with competitors and market trends. The most successful small businesses won’t necessarily be those with the most data, but those that can use it to detect the trends and opportunities to act on.
This article first appeared in issue 35 of the Inside Small Business quarterly magazine