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Marketing a top priority for SMEs in 2021, finds UOB study

Marketing a top priority for SMEs in 2021, finds UOB study

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Marketing should be, and is indeed, a priority for SMEs for digitisation purposes in the near future, said a recent study done by UOB titled "UOB SME Outlook 2021 Study". The study added that inventory management, payroll, accounting and sales were also the top skills required. This is in contrast to 2020, where marketing did not make the cut. Last year, the focus was on electronic payments, electronic invoicing, payroll, accounting and sales.

The 2021 study found that SMEs that place greater emphasis on the need to use digital tools for marketing came from sectors such as consumer goods, professional services and real estate/hospitality. SMEs in the consumer goods as well as construction and infrastructure sectors were also found to be more active in ramping up digitisation for their inventory management. 

Although UOB did not mention the specific reasons why businesses are looking into marketing as one of its top priorities for digitisation, a study by Ministry of Manpower in 2020 showed that the accelerated pace of digitisation in 2020 resulted in a higher demand for firms offering consultancy, design and advertising and marketing due to their digital expertise. This surge in demand was attributed to more companies seeking to stand out among the growing number of competitors in the digital sphere.

The report added that the demand for advertising and marketing roles such as content strategists, community managers and commercial and marketing sales executives remains high. 

Additionally, UOB's study found that small businesses are lagging behind their larger peers in digital transformation, as seven in 10 of all SMEs (72%) that have not yet digitised are found to be smaller businesses. When asked why they have not adopted digital tools for their businesses yet, 34% of the respondents said digitisation was an expensive process, while 31% said they fear cybersecurity issues. Another 31% also said their employees do not have the necessary digital skillsets for them to digitise.

SMEs that did not digitise also said they have insufficient funds to continue with digital adoption (26%) or find it hard to justify the value of the investment (28%). Some are facing incompatibility issues between old and new systems as well (25%).

Although digitisation may seem like a hefty investment, UOB's study said that it is imperative if SMEs want to improve business profitability. In a survey conducted late last year, UOB found that two in five SMEs (41%) that had implemented digitisation initiatives in 2020 experienced stronger revenue growth than non-adopters. Those that had digitised their entire business or multiple areas reported better revenue growth than those that digitalised only one area. In contrast, six in 10 SMEs that did not adopt any digital tools saw a decline in their 2020 net revenue as compared with 2019.

Commenting on the findings, Lawrence Loh, head of group business banking, UOB, reminded businesses that the digitalisation journey is a long one, and urged SMEs to stay the course to see their efforts pay off when they emerge stronger through the pandemic. "Digitalisation offers businesses many opportunities, from improving their processes and reaching out to new customers to having a direct and measurable impact on their revenue. The UOB SME Outlook 2021 Study demonstrates that close to one in two SMEs who proactively took steps to adopt digital tools last year are already seeing benefits such as greater productivity and efficiency gains, improved customer experience and higher revenue, even in a volatile business environment," he added. 

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