SME digitization: costs and lack of time are the biggest hurdles

Although the vast majority (79%) of the small and medium-sized companies surveyed in Germany see digitization as an important building block for their future viability, the positive digitization effects caused by the corona pandemic were not sustainable in many areas.

According to a YouGov study commissioned by the hosting provider IONOS, costs and lack of time are the biggest hurdles. For the study, YouGov surveyed a total of 1,004 people from companies with up to 250 employees in Germany (survey period January 14-24, 2022).

Year-on-year comparison: Lose newsletter, professional e-mail wins

In particular, the use of solutions that facilitate digital collaboration or serve to provide customer information has declined compared to the previous year: while at the beginning of the second pandemic year 2021, more than half of those surveyed (54%) were still informing their customers via newsletter or mailing , it is now 36%. So-called collaboration tools are also only used by 36% (vs. 49% last year). Also, significantly fewer companies are listed in online directories year-on-year (from 48% to 40%). In contrast, the number of companies using a professional e-mail address with their own domain has increased by more than ten percentage points (from 53% to 64%). 63% of those surveyed still have a company website, and 29% have an online shop, slightly more than in the previous year (25%).

Costs and lack of time slow down digitization

For almost half of the companies surveyed, costs (48%) and lack of time (46%) are the biggest hurdles in digitizing their company, followed by uncertainty about security and data protection (39%). For more than a third (37%) of those surveyed, a lack of know-how is the biggest obstacle to digitization, and for almost a quarter (24%) it fails because of interest.

Visibility on the web is the focus

Eight out of ten respondents (81%) consider the presence and findability of their company on the Internet to be the greatest benefit of digitization. They also expect positive effects in terms of new customer acquisition (75%), increased sales and a modern overall impression (72% each). The most important thing for companies is therefore to improve their visibility on the Internet (46%). For 37%, the focus is on IT security and data protection (37%). As a result, most of the budget will flow into these areas in 2022 – websites (28%), IT infrastructure (26%), online marketing (22%) and social media (21%) are the top investment fields for SMEs in Germany. The shifting of the entire business model to the cloud is less important (27%), one fifth (20%) of the companies do not focus on digitization at all. This is also reflected in the specific budget planning: 26% of those surveyed have not planned any investments in digitization in 2022.

“Many small and medium-sized companies have finally recognized that digitization secures their future viability,” says Achim Weiß, CEO of IONOS. “Unfortunately, the results of the YouGov survey also show that there are still problems with implementation. If budget and lack of time keep companies from this essential task, simple, unbureaucratic help and solutions are needed! Pandemic-related grants that could also be used for digitization measures were apparently insufficient or too complicated.”

About the survey:

The data used is based on an online survey conducted by YouGov Deutschland GmbH on behalf of IONOS among 1,004 people from small and medium-sized companies with up to 250 employees in Germany (survey period January 14-24, 2022).