A new survey found that the majority of small and medium-sized businesses (SMBs) in the Asia-Pacific (APAC) are hesitant to embrace digital tools.
A new report from Accenture, found that respondents cited a range of issues including inadequate support, high costs and complexity as leading barriers to adoption.
Based on a survey of 1,500 executives across SMBs in China, Indonesia and Japan, the report — “Driving New Growth for APAC SMBs: Realizing the Platform Opportunity” — found that many SMBs do not see the value in platforms and online tools.
The report found that even though consumers are active users of online platforms, two-thirds (68%) of the SMBs surveyed do not plan to increase digital spending for sales, marketing, customer service or e-commerce tools; among them, one in six (17%) is actually planning to decrease their digital spending in these areas.
This is despite the fact that there are more than 500 million active mobile payment users in China and digital transactions in Indonesia nearly quadrupled between 2014 and 2017, according to the report.
“SMBs are the world’s most powerful growth engine and make up 98% of all businesses in China, Indonesia and Japan,” said James Kim, managing director of Accenture’s Software & Platforms industry practice in Asia-Pacific.
“For platform companies, this presents a potential market opportunity in Asia-Pacific. Creating successful outcomes for SMBs will require helping them overcome perceived barriers to adopting digital platforms.”
Nearly half (45%) of all respondents also identified privacy and security concerns as a top barrier to adopting digital platforms. Other concerns included lack of customer support for marketing tools (cited by 44% of respondents), uncertainty with the relevancy of data analytics (38%), and high service charges for payment tools (37%), among others.
When the non-digital SMBs were asked why they hadn’t yet adopted digital platforms, nearly three-quarters (72%) cited uncertainty about whether digital platforms would help their business, two-thirds (65%) cited the expense and difficultly of implementing and maintaining the platforms, and more than half (55%) cited their lack of skills and experience needed to manage digital platforms.
The survey found that digital tools were most commonly used in the marketing function — cited by 88% of respondents in Indonesia, 77% of respondents in China and 62% of respondents in Japan — significantly more than for sales, payments and customer-service functions.
“Since customers of SMBs are increasingly embracing digital channels to engage and transact, SMBs would be wise to embrace digital as well,” Mr Kim said.