Facebook reports that the number of small businesses using digital tools has grown globally from 81 percent to 88 percent in the past six months.

The uptake of digital tools has increased during the COVID-19 pandemic. Small businesses have had to adapt to new ways of reaching customers in addition to overcoming physical constraints on operations.

According to a Facebook survey, SMEs are most likely to report using digital tools to advertise and communicate with customers. Although the use of digital tools is increasing for a variety of purposes.

Facebook survey data is shared as part of the company’s Small Business report. Much of the 55-page report focuses on changes in income, employment, and closures.

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If you dig deep enough into the report, you’ll find a chapter dedicated to digital tools. This information should be reviewed to keep up to date with the needs of small business owners as their operating structure quickly transitions to digital mode.

Here are the highlights from the four sections of the Facebook Small Business Status Report 2021.

Use of digital tools by small businesses in 2021

How do SMEs use digital tools?

Most managers of small businesses that are still operating report an increase in the use of digital tools.

The largest increase was in advertising and sales of goods and services. The share of SMEs using digital tools increased by 21% and 12%.

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The most frequently reported use of digital tools by SMEs since July 2021 for the least reported use is:

  • Advertising
  • Communication with customers
  • Sale of goods and services
  • Analyzes or researches business issues
  • Coordination or cooperation between employees
  • Hiring

The chart below shows how usage has changed over the last six months. On the right, you can see that the number of SMEs that say they do not use digital tools is declining rapidly.

Screenshot from dataforgood.fb.com, September 2021.

What kind of SMEs use digital tools?

The deployment of digital tools is different in different sectors. For example, in the construction sector, 80% reported using digital tools, while in the ICT sector, 93%.

ICT SMEs reported increasing their use of digital tools in all categories except for the sale of goods and services. Wholesale and retail companies are most likely to report the use of digital tools to sell goods and services.

Consumer SMEs were more likely to use digital tools in advertising than non-consumers. The increase in the use of digital advertising tools is mainly driven by SMEs in the restaurant sector.

Small businesses in most industries reported communicating with customers as the most common reason to use digital tools. The hospitality sector is the only deviation where advertising tools are used more than communication tools.

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What is the impact so far?

The increasing use of digital tools has mostly benefited small businesses. About 69% of SMEs reported that the use of digital tools has had at least one positive impact on their business, such as sales or customer growth.

Several SMEs reported that digital tools had led to sales growth after any other impact, after which the customer or supplier base grew.

More than 30% of small businesses report that digital tools have not made an impact at all. Maybe here is an opportunity to train SMEs and help them navigate the world of digital work?

Facebook reports increase the use of digital tools among SMEs

More than half of SMEs (53%) confirmed that their use of digital tools is likely to change permanently due to the COVID-19 pandemic.

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Source: Facebook Small Business Report

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