How SMEs are using digital


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A new report into SMEs’ digital use uncovers key insights into areas including digital spending and digital customer engagement.

Suncorp Bank’s Cost of Being Connected report reveals the sector spends on average $17,000 a year to remain connected – meaning time and money spent on technology-related products and services such as computer supplies, telecoms and internet, IT support and digital marketing.

Drilling down further, sole traders spend an average of just under $6000 per year, small businesses (2-19 staff) spend just over $26,000 and medium-sized businesses (20-199 staff) spend an average of almost $175,000.

Across all SMEs, the majority of money was spent on telecommunications and internet ($4012 – 23%), followed by hardware ($3815 – 22%), IT development, support and maintenance ($3350 – 19%), software ($2780 – 16%) and digital marketing and monitoring ($2512 – 14%).

The report also looks at the ways SMEs are using technology to attract and engage customers. In terms of reaching new customers, 34% use unpaid social media such as Facebook, while 28% use direct email marketing to attract new business. Other popular ways to reach new customers include search engine optimisation (16%) and social media paid advertising (12%).

To engage existing customers, top digital measures adopted by SMEs included social media activity (36%), regular e-newsletters/email updates or announcements (26%) and personal account management via a website (11%).

And to further bolster engagement with employees, SMEs are using tools such as email or online video updates from senior staff (31%), external social networks (22%) and internal online noticeboards (13%).

Interestingly, while 42% of all small and medium-sized businesses do not engage with their staff digitally, only 4% of the largest (ie. medium-sized) business don’t do this in some way,” the report notes.

And despite the rise of digital platforms that increase connection and engagement with clients, traditional communications methods are still important – 83% of SME respondents agree that contact with clients is primarily face-to-face, phone or email

But the survey found not all businesses are digitally engaged: 33% of respondents do not use technology to engage new or existing customers.

Of this proportion, 74% are sole traders, and the largest share comes from the professional and financial service sector (29%) compared to just 7% in retail and hospitality.

Digitally engaged SMEs are more concerned about attracting new customers (53%) than the digitally disengaged (34%),” the report states.

Of note, the survey found more than half of digitally disengaged SMEs don’t have specific business goals or plans, while digitally engaged SMEs are “more likely to be planning to expand their operational, promotional, logistical, technological and personnel capacity over the medium term”.

Additional key findings from the report include:

  • Approximately 20% of SMEs surveyed agree that their business operates in a 9-5 hour day, compared to 70% that agree traditional business hours are a thing of the past, instead working to accommodate clients when they need it most. A further 65% agree with the statement: customer expectations on speed and timeliness of response times have continually increased over the past five years.
  • Just 40% of ‘digitally disengaged’ SMEs agree technology has been fundamental in helping the sector keep up with increased demand from clients, which jumps to 66% of those businesses that are digitally connected.
  • When it comes to business concerns over the next one to five years, the top five concerns were: attracting new customers/sales (46%), followed by the economic climate in Australia (39%), retaining existing customers (37%) cash flow (35%) and increasing costs/overheads (31%).
  • Small businesses (2-19 staff) are especially worried about increasing overheads and competition, while larger SMEs are more concerned about employee engagement than their smaller counterparts.


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