“Online Identity a Must,” says MSME; But Adoption Still Dismal

To scale-up marketing efforts MSME sector in India is rapidly embracing online media. 61% of 10 million technology-ready MSMEs, give high importance to adoption of various online identities such as email, websites, social media etc.

This was revealed by a report titled ‘Tapping the MSME Potential’, published by the Internet and Mobile Association of India (IAMAI) and IMRB International.

The report further elaborates that over 80% of these MSMEs would prefer .com domain names as their online destination. Micro, Small as well as Medium Sized Businesses find online media relevant for their business. This is true especially for MSMEs that engage in Travel/ Trade and Logistics, IT/ITES, BFSI and Education businesses.

MSME Universe by Industry Vertical

MSME UNIVERSE Vertical Universe Size
Manufacturing 16%
BFSI 10%
Travel/Trade/Transport/Courier 19%
Education 7%
Retail 20%
Real Estate 4%
Health care             4%
Other Business 12%
Total 10 Million


The report further finds that amongst various online tools, micro and small enterprises rank websites highest in relevance. There are about 1.35 mn small and micro enterprises that own websites and that number is likely to grow 3 times its size to about 4 mn by 2020. The key step towards creating a branded online presence is to register a domain name and the report describes the awareness and preference levels of various domains available in India. Clearly, .com domain not only has the highest top of mind recall (81%), but also, is the most preferred top-level domain (82%) for small, medium and micro enterprises in the country. The main reason for this is that .com domain names are universally used, trustworthy and easy to remember.

Current adoption of website by industry verticals

Heathcare – 7%
Retail – 4%
Real Estate – 14%
Manufacturing – 17%
Overall adoption – 24%
IT/ITes – 36%
Education – 28%
BFSI – 25%
TTL(Travel, Trade and Logistics) – 24%

MSMEs from retail and healthcare verticals, which show lower adoption of website in their business, cite several reasons like lack of tech savvy amongst their customers, their perception of relevance of websites only for larger organizations, the myth that their business does not need a website and lack of adoption by their peers. The table below provides interesting insight for non-adoption.

Manufacturing, BFSI and Retail are amongst the key verticals that will witness a faster adoption of websites by MSMEs in the near future. Website adoption rates in these verticals are lower as compared to other verticals. MSMEs engaged in IT/ITES, will see a relatively lower rate of adoption of website because there is high adoption there already.

Future adoption of websites by MSMEs
Future adoption of websites by MSMEs

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