According to a study by Google India, over 57 per cent of small and medium enterprises in the country use their website as a sales channel and get direct business leads from their website. The study was conducted to understand usage patterns and importance of online medium amongst the SMEs in India.

The study further reveals that while accessing email is the #1 purpose for using the internet, 71 per cent of SMEs also use the internet to search for vendors and suppliers and about 40 per cent of them use the internet to create online listings and advertise online.

Amongst the SMEs who have an online presence, 56 per cent of them feel that the internet is a cost effective medium as compared to traditional advertising medium like print and television and 79 per cent of SMEs believe that internet advertising can provide greater reach.

It was also found that SMEs with marketing spends between Rs 25-70 lakh per annum tend to spend higher on the online medium and rely less on traditional media like print and television. But majority of the spends (43%) comes from SMEs who spend between Rs 12-25 lakh on advertising on an annual basis, reflecting the low cost benefit of the internet.

Sridhar Seshadri, head, online sales, Google India, has said, “While the absolute number of SMEs with an online presence is very low compared to actual businesses in India, we are pleasantly surprised to see increasing understanding amongst Indian SMEs to use the web for business growth.”

For the purpose of this study, 785 SMEs (owners or marketing heads) were interviewed across India including Mumbai, Delhi NCR, Ludhiana, Kolkata, Bangalore, Chennai, Coimbatore, Hyderabad, Ahmedabad, Surat, Cochin, Pune, Nashik and Nagpur.