Online business driving economic growth

By Celine Mercier

“The single market – getting Europe’s SMEs online”, an event organised by Google last Tuesday, gathered a wide range of people to talk about the role of European SMEs in economic growth. Representatives from the European Commission, MEPs, EU trade associations, NGOs, the media, entrepreneurs, consultancies and more traditional companies were present to discuss opportunities and obstacles of an online Single Market.

 

SMEs are the engine of the economy and the Internet is a powerful tool for them to leverage for expansion. 15 “success stories” of online companies from 15 different European countries showcased how the Internet helped them to start or to grow dramatically. With 2.5 billion Internet users globally and 5 billion mobile phone users, there are huge opportunities for business. The disruption of the Internet is clearly a myth as numbers show that for every job lost there are 2.6 new positions created in the digital economy. As the Commission Vice President Antonio Tajani stated yesterday, online SMEs grow twice as fast as other companies, thus driving economic growth. The European Union fully supports them and put the digital economy at the heart of its strategy. “Our goal is to double the amount of commerce online by 2015,” Tajani said.

 

However, online business is scattered and very sensitive to competition. And the amazing resource that the Internet is can still be seen as too technical or too expensive by entrepreneurs. That is why Google launched the initiative “Getting business online” to spread all the benefits of going online. Some entrepreneurs present at the conference confirmed how Google AdWords campaigns have helped them to find their target audience and increase sales.

 

We are still far from an online Single Market though. Entrepreneurs and the traditional business services companies that accompany them – postal and telecommunications companies – agreed that there are still strong barriers to more e-commerce in other, sometimes neighbouring, European countries. Those obstacles include: taxation and payment systems, consumer rights legislation, freight and delivery costs.

 

According to the entrepreneurs at the event, the recipe for an online business success story is to find first THE niche market where there is no offer yet, thus no competition, and where consumers tend to go online to search for what they cannot find ‘IRL’ (in real life). And the second most important key to growth is targeted marketing: getting to the right audience online to be able to sell. However good an idea is, if it is not made public, it will not sell. Hence the importance of a good integrated communications strategy, which can be difficult for entrepreneurs who often have to do so many things at the same time to launch their business. Finally, online businesses cannot avoid Social Media as part of their communications strategy, as it is now a key channel for reaching online prospects.

 

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