Almost a quarter (22%) of Irish SMEs are completely offline, despite half acknowledging that an online presence is important for generating business awareness.
This is according to a new research report published today by the IE Domain Registry (IEDR), the company responsible for managing and maintaining Ireland’s official domain name, .ie.
The majority of offline SMEs (68%) believe there is simply ‘no need’ to have a website. When probed further, respondents said that this is because most of their business is word-of-mouth (78%); others said that they already have lots of business (23%) or are happy with the scale of their business (17%). Reassuringly, only 17% said they see no value in having a website.
However, this justification is not enough for Irish consumers. IEDR research shows that 83% of consumers think SMEs should have at least a basic website that lists contact details, while 68% believe a business is ‘outdated’ if it doesn’t have an online presence. Seventy one percent are more likely to buy from a business that has a website.
Among the SMEs that are online, few can engage in e-commerce (selling online): 30% can take sales orders or process payments, while just 29% can accept bookings or reservations online. Only 37% of SMEs promote their businesses online, spending an average of €161 per year on search engine and social media marketing.
Ireland’s share of the European e-commerce market is valued at €9 billion and is set to grow to €14 billion by 2021. However, most of this spend is going abroad to foreign retailers who provide comprehensive e-commerce shopping experiences, including direct-to-door delivery. Despite this, the odds are stacked in Irish businesses’ favour: 77% of consumers say that buying Irish is important to them.
While many SMEs believe there is no need to have an online presence, others simply struggle to get online. A third say a lack of time is keeping them offline, while 29% say a lack of expertise and 26%, cost.
Interestingly, more say concern over cybersecurity (17%) is a barrier to going online than a lack of reliable internet connection (13%). In the last wave of research, a poor internet connection was responsible for keeping 17% of businesses offline.
Encouragingly, 20% of SMEs say they are currently in the process of building a website, up sharply on the 8% recorded in the last wave of research. The number saying they have no plans to build one in the near future has dropped from 66% to 57%.
Commenting on the findings of the latest dot ie Digital Health Index, David Curtin, Chief Executive of IEDR, said, "Less than a third of businesses with websites can take sales orders or process payments via their website, yet Irish consumers are buying online in huge numbers. Our e-commerce market is set to grow to €14 billion by 2021, but most of that spend is predicted to go abroad."
He added, "We live in an age of convenience. With so many international retailers online and offering complete shopping experiences already, offline SMEs in this country face an uphill battle winning back the loyalty of Irish consumers. This is a huge and ongoing loss, considering Irish consumers’ willingness to buy Irish."