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Published 19 April 2013 09:23, Updated 16 May 2013 07:31
Google’s Karim Temsamani says the company is keen to help small businesses. Photo: Andrew Quilty
Small businesses in Australia and the wider Asia-Pacific are becoming crucial to revenue for companies like Google, but many SMEs still don’t understand the benefits of doing business online, says Google Asia-Pacific president Karim Temsamani.
Google is aggressively chasing small and medium businesses, which Temsamani says is a growing part of Google’s overall revenue and its Australian operations.
“About 2.5 billion people have access to the internet and there’s going to be 500 million people getting access to net by the end of 2015,” Temsamani told BRW during a media event in Singapore designed to demonstrate Google’s renewed focus on SMEs.
“We see it as an opportunity for us to get far more businesses online.”
While Asia continues to be a big growth opportunity for Google, the company has faced significant challenges in China where the country’s leaders continue to censor the internet.
Businesses targeting online consumers in China via search engine optimisation services offered by Google are restricted.
Temsamani says Google is expanding its operations in China and helping local businesses export around the world. When it comes to businesses in Australia and other countries trying to market to China, he concedes they are more limited.
But Google China is gradually integrating its advertising products, including AdSense, AdWords, DoubleClick, and AdMob, into its Google Display Network product to reach Chinese internet users. “Obviously the rest of services we can provide them are more limited in China,” Temsamani says.
Australia and Asia-Pacific represent high-growth area for Google
That doesn’t mean the rest of the world’s small business markets isn’t up for grabs though. Singapore has a higher percentage of small businesses that advertise on Google than in the UK and the US.
Thanks to the countries’ high internet penetration rates, Australia and New Zealand have the third-highest percentage of SMEs advertising with Google within the Asia-Pacific region (Vietnam comes in second).
“If you’re looking for the next internet growth phenomena across Asia, I suggest you stop for a second looking at businesses such as Facebook . . . or even Google,” Temsamani says.
“Instead look at the millions of small businesses that are quietly taking advantage of the new rules to go big.”
He says SMEs have “an opportunity to grow the business in the way they never have before”, regardless of location or industry.
“Small businesses are a tremendous part of any country’s economy, and because of the internet, many small businesses now have the ability to compete with any business anywhere around the world,” he says.
High internet adoption yet to translate into economic output for much of Asia Pacific
Despite internet adoption among SMEs in Asia being extremely high – research by global think tank McKinsey & Company shows that Australia leads the way with a 90 per cent rate of adoption followed by Korea (83 per cent), Japan (80 per cent) and Singapore (77 per cent) – most still have a limited impact on gross domestic product.
SMEs in Australia are contributing more to GDP than most other countries (57 per cent), only behind China at 60 per cent. But the vast majority of other countries in Asia contribute under 50 per cent of total economic output.
Temsamani says in order to raise their economic contribution, businesses need to go online and use services such as video and mobile ads to reach a wider audience.
Google AdWords levels playing field for SMEs
Google will not disclose how much of a percentage SMEs contribute to the company’s overall revenue but Temsamni says in recent years Google has made a big effort to try and attract more SMEs to use their services including AdWords.
AdWords allows Google customers to use the service to find internet users actively searching for information about products and services on the Google search engine.
“Our founders always had in mind the intention to use Adwords to level the playing field,” Temsamani says. “It allows any business to compete against large businesses anywhere around the world.”
Google now also uses a proximity filter that can allow the business to target customers with mobile devices based on location and/or at specific times of the day. It’s been a big hit with businesses overseas, especially in retail.
Temsamani expects it may have the same impact in Australia, and says it helps small and large businesses who can pay extra for being at the top of search engines at different times of the day.
“Many businesses are using those services to be far more efficient in reaching consumers,” he says. “You can decide to bid differently not only based on location but bid differentially based on the time of the day.
“If you’re a coffee shop owner you may want to appear . . . early in the morning or lunchtime when you want to get people in your coffee shop. In the afternoon you may be happy not to bid high up.”
Google targets SMEs with new initiatives
Deloitte research released by Google last week shows small businesses with high digital engagement are two times more likely to be growing revenue. They are also four times more likely to be hiring more staff.
But the Deloitte research also shows that only 16 per cent of Aussie small businesses have “high digital engagement”.
While Google has been chasing SMEs for years, it’s recently ramped up its hunt with new initiatives. In February, it launched the “Google Engage” program with the former innovation minister Chris Bowen.
Google has 3000 businesses across Australia involved in the program. It allows small web businesses promoting Google products to get free training and networking events, and in turn Google benefits with the SME selling their Google Apps to more customers.
Two years ago the company also partnered with Yellow Pages’ Sensis to help strengthen AdWords, and just last year built on that partnership by specifically targeting SMEs. It now allows small companies to tap into training from Sensis as well.
“We see small business as core to our operations in Australia and we are investing a tremendous amount of dollars and energy and time and people in growing our presence,” Temsamani says.
It’s unclear how much a small business has to spend with Google before getting face-to-face service from the company. At the moment Google project managers are reserved for big businesses, while small businesses have to access help via online chat services and/or by phone.
Temsamani says the company has systems in place for small businesses to raise any issues.
He says Google helps businesses regardless of size, but obviously as businesses grow, they need more sophisticated technology and their spend goes up. “As they grow we can continue to help them optimise their campaign and ensure they’re getting the right service from Google,” he says.
The writer was a guest of Google at a recent media event in Singapore.