Small and Medium Enterprises (SMEs) are the backbone of the Sri Lankan economy. According to the Adovcata Institue, SMEs account for 45% of domestic employment and 52% of Sri Lanka’s GDP. Following the coronavirus outbreak businesses large and small turned to technology for continuity. Recently, 2 surveys released by Facebook found SMEs and consumers increased their use of digital tools and social media since the outbreak.
In August 2020, Deloitte carried out the Facebook-commissioned Digital Tools in Crisis and Recovery – Small and Medium Business survey. It assessed how SMEs changed their utilization of digital technologies and social media to continue engaging with customers during the pandemic. Approximately 37% of business owners and managers surveyed were younger than 35. Further, 32% of those surveyed were women, and 4% were sole entrepreneurs with no employees.
The research shows that since the outbreak, 42% of SMEs started using or increased their usage of social media to interact with customers. Among them, 93% reported they have been using Facebook more. It was also reported that 80% used WhatsApp more and 29% increased their usage of Instagram. Marketing practices also evolved following the shift towards operating online. Of the SMEs surveyed, 46% stated they increased their paid/unpaid marketing towards prospective customers.
Commenting on the findings, Yasas Vishuddhi Abeywickrama, Policy Programs Manager for Sri Lanka at Facebook said, “The report shows that since the pandemic has taken hold, consumers are spending more online and leaning on digital tools to discover and engage with businesses they care about. Facebook’s products and features have been a lifeline for many small businesses making this leap to shift to online – we’ll continue to support them as they adapt during these uncertain time.”
Another report Facebook released is the Digital Tools in Crisis and Recovery – Consumer. Its focus was to highlight how consumers utilized digital technologies and how social media supported continuous engagement with businesses. The research shows that consumers were more interested in supporting small businesses during the coronavirus pandemic.
Digging through the findings of the report, approximately 69% of consumers that switched to new businesses chose local SMEs. Further, 70% of these consumers used social media to find these businesses. Among them, 83% used social media or online messaging to communicate with businesses. 62% also used it to browse through the products on offer.
Looking towards the future, 36% of consumers surveyed stated they expect to spend more purchasing products from SMEs. This observation is in line with global trends. The Facebook commissioned survey carried out by Delloite was conducted in 13 countries including Sri Lanka. It found that 31% of all respondents planned to increase their spending with local SMEs after the pandemic is over.