NZ businesses failing to realise the benefits of an effective website

Friday, 03 December 2010 00:00

Domainz have published the results of their survey of 668 small and medium New Zealand businesses which was conducted in May and June 2010. They were looking for insights into how innovative small businesses are online (amongst other things).

In their report, they reported that 79% of SMBs surveyed agreed “the Internet is vital to the operation of my business”, and 44% said an increasing amount of their business’ revenues were derived online.

This is interesting because it means that 21% of small and medium businesses believe otherwise (although to what degree is unclear).  From speaking to small business in particular, a lot of businesses have websites because they know they should - without knowing how it could drive growth or improve business performance.

The Domainz report comments that "The growth of the Internet as a business tool has been embraced by small and medium sized businesses".  However, an article by TVNZ, which covered the latest MYOB Business Monitor, reports only 34% of businesses in NZ own a website, which is staggering.

It would seem that NZ businesses have yet to fully grasp the opportunities that a website can offer.

They have also been slow to adopt more sophisticated online tools and trends, with only 14% of businesses using social media. And it's not the small towns to blame - New Zealand's main centres are showing online adoption rates only slightly higher than the rest of the country.

From our experience, many SMB owners and managers struggle to move past the mindset that a website is purely for marketing purposes – and even then, it's a pretty narrow view of what that marketing might look like.  Few of these businesses include productivity improvement or increased customer satisfaction as goals for their website.  They continue to post out printed forms, or answer client questions that could be done more efficiently, and often more effectively, via a website.

In fact there are many reasons to have a website, and MYOB General Manager Julian Smith told TVNZ that evidence shows a good online presence is a strong driver of business growth. Smith says Kiwi businesses who are just starting to think about a website need to put it on their priority list and we couldn't agree more.  Even sole traders have much to gain with an effective online presence.

Domainz says that the global eCommerce market is expected to be worth $623 billion USD in 2010 and grow to $743 billion USD in 2011, and that NZ businesses are “positioning themselves well to grab their share”.

Other evidence and our experience would suggest that NZ businesses have a way to go yet.

This is an important issue and one the government should perhaps pay attention to.  The internet presents an opportunity to overcome some of New Zealands biggest economic challenges. The first being our location, the second being the levels of productivity in our businesses.