May 23, 2007

Small Businesses Are Still Not Aware of Online Applications

Tech research firm AMI Partners released a study, Will Small Businesses Buy the Online Office that showed that small businesses, after years of awareness in the media and with advertising still don't know about online applications as much as they need to.

"Inertia, potential security threats, and possible incompatibility between online documents and PC software serve as inhibitors to SB adoption of online personal productivity solutions," according to Laurie McCabe, author of the report and Vice President for SMB Insights and Solutions at AMI-Partners. "Internet connection and performance problems also hinder adoption in Brazil and India."

What can vendors and local consultants to to increase the adoption of hosted applications by smaller businesses? I'm not sure if anything can be done.

It's clear that there is interest in hosted applications by mid-size companies - Netsuite and Salesforce.com have built their businesses on this model.

However, smaller companies are not switching from Quickbooks to Quickbooks online in droves for example. They're not leaving Microsoft Office for Google Apps.

If you segment the "small business" market into the technologically advance and those who are not, you'll find a larger number of the first category are adopting online apps much faster than the later group.

What would drive SBs to adopt online productivity applications?

AMI USA writes that a sizable percentage of respondents view time and cost savings convenience, mobility and ease of use as key benefits of using online applications. Respondents are also much more likely to consider online services given certain cost and pricing breaks.

A high percentage of customers in all four countries are willing to accept advertising in exchange for free use of online personal productivity software, and a significant number of customers would choose the online route given a large enough pricing advantage over desktop solutions. Customers also indicated strong interest in hybrid solutions that provide flexible access via both desktop and Web interfaces.

As I've said, what, 100, 1000 times, if your business is NOT embracing technology you will find (sooner or later) that your competitors are going to go far ahead of you in doing things more efficiently, in saving me and serving customers.

Your customers will migrate or run to YOUR competitor that offers better service at a better price. Technology helps do this.

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