Luke Mckend
With recent research from World Wide Worx firmly establishing the internet as a powerful force for South African businesses, the ability for companies of all sizes to get online rapidly opens up new possibilities for growth.
That’s a message that small businesses are taking to heart: in just six months since its launch, more than 25 000 small businesses have taken advantage of the free websites offered by the Woza Online initiative.
First, let’s look at the research. It comes from the report “Internet Matters: The Quiet Engine of the South African Economy”, commissioned by Google South Africa and published by World Wide Worx.
For the first time, the report quantifies the internet economy, which contributes 2 percent to South Africa’s gross domestic product, a portion that is rising by about 0.1 percentage points a year.
The total spent by consumers, small and medium enterprises (SMEs), and the government on products and services via the internet, as well as on internet access and infrastructure, is R59 billion.
The internet, in other words, is the centre of massive activity. The internet population currently stands at 10 million, and by the end of the year is set to be 10.8 million.
More than that, e-commerce is growing at about 30 percent a year, and shows no signs of slowing down as consumers increasingly go online with devices like smartphones and tablets, and become more adept at using the internet.
There’s more to the research, too. In a survey of smaller businesses, about 410 000 SMEs in South Africa were found to have their own website. This is only 63 percent of active, formal small businesses, meaning that over a third of such businesses have no online presence.
It was also found that those with a website are far more likely to be highly profitable than those without. Last but not least, about 150 000 SMEs, employing about 1.56 million people, would not survive without their web presence.
With this research clearly showing just how important it is to be online, Google has teamed up with the Department of Trade and Industry, Vodacom and the Human Resource Development Council to help South African small business get on to the web.
For free. That’s how important these organisations believe the internet is for almost every business; by getting them online, the potential for better businesses, more jobs and a reduction of the digital divide is meaningfully unleashed.
Older, wiser and more money means online.
Typically, it is older businesses that tend to have websites, because when a new company is getting off the ground, capital tends to be thin. Capital has to be prioritised for survival, in many cases, to cover critical services, rent, products, stock and salaries.
Woza Online makes sure that one other critical service is taken care of with zero financial impact. But it goes a step further, too: since the new SME owner is also often the managing director, chief financial officer, and information technology manager, there is a good chance that the necessary time and skills to “get online” are also in short supply.
The Woza Online project is expressly designed with this in mind: the business owner gets the ability to create an online presence with simple steps, in under an hour. It reduces the barrier to entry in terms of both effort and cost.
Does it work?
That’s probably the most important consideration of all. Even if it only takes a little effort and no money to get online, and even though there is much research to confirm that being online is a necessity for the SME, does Woza Online actually deliver?
It does. A case in point is Caroline Rule’s Rolling Rehab, which helps people who have lost limbs or suffered traumatic brain injury.
Until recently, much of her time was spent offering telephonic guidance. People would hear of Caroline through word of mouth, make contact and, over the phone, listen to her to run through the many services she offers. By creating a website, it was instantly possible to share her knowledge with far more people, far more easily.
Even better, within days of going live, Caroline was contacted by a company that had been trying to identify an appropriate beneficiary for its corporate social investment programme.
The internet offers unrivalled and unimagined opportunities for “one-to-many” communication. It opens new doors and, when used by the SME owner, it will help stimulate ideas and opportunities that may never have been considered otherwise.
With Woza Online, small businesses can do that today. With over 25 000 SMEs already online, we want to help tens of thousands more SMEs get websites for the first time – and help every one of them become a more effective business.
This, in turn, can have a greater impact on the economy and the nation as a whole.
Luke Mckend is country manager for Google South Africa.