Amazon Ads has recently conducted a research to understand from the marketing decision makers themselves from about 300 Business To Consumer Small and Medium Businesses as to how they are benefiting from the positive impact of advertising as Indian SMBs look to expand both at home and internationally.
As part of the same, the ad vertical of e-commerce major found out that 72% of India small and medium sized businesses (SMB) currently invest in advertising and of those, 85% say it is successfully helping them acquire new India customers. Moreover, more than two-thirds of India SMBs (69%) also reported success in using advertising to help them grow their business internationally
On a slightly comprehensive note, the study also mentioned that nearly 9 in 10 marketers (85%) said that their current advertising strategy is successful in acquiring new customers while more than three quarters (78%) said it had helped them to expand their India business.
That being said, of the 300 SMBs sampled, more than two-thirds (69%) businesses also pointed out that advertising had helped them grow their business internationally within the last 12 months and almost three quarters (72%) said that they currently spend on advertising, compared to 28% that do not spend advertising at all.
As per Amazon Ads, this confidence in advertising led more than half (56%) Indian SMBs to increase their spend on advertising during the past year, while 22% kept their budget the same year-on-year. Looking ahead, more than a third (36%) of those sampled said they planned to spend on streaming TV advertising during the next 12 months.
The most common motivations for this increase in ad spends, as per Amazon Ads, encompass priorities like driving awareness of a new product or service (42%) , improving customer awareness of their brand (50%).
The study also showed that while success is enjoyed by some, not all SMBs feel they need advertising to grow their business and therefore nearly 28% of Indian SMBs do not currently spend on any kind of advertising.
Upon being asked as to why they are not currently advertising, the most common response that Amazon Ads received was that it is too expensive (26%) while a similar number (20%) said they haven’t seen a return on previous investments (ROI).
Even among SMBs that are currently spending on advertising, challenges remain- 3 in 10 (30%) said that their biggest challenge with advertising is knowing where to focus their advertising budgets to achieve their goals, while around a third (36%) said creating compelling content was the greatest challenge their business faced when it came to advertising successfully.
Commenting on the development, Kapil Sharma, Director, Growth Customer Sales, Amazon Ads India, said, “At Amazon Ads, we aim to provide SMBs with solutions and insights to make advertising as simple as possible. With the help of our self-service advertising tools and learning console, we have helped SMBs achieve a variety of business goals, including raising brand awareness, increasing sales and boosting customer loyalty.”
“With low cost of entry and closed-loop measurement, Amazon Ads helps SMBs across categories to promote their products to relevant audiences across India,” he added.
Sharing his views from an SMB partner POV, Tushar Khurana, Co-founder, Perfora, said, “Amazon Ads gave us a level playing field with older and existing competition by allowing us to showcase our offerings to interested customers. With innovative use of Amazon Ads tools, we were able to reach relevant customers who had the intent and willingness. Using Sponsored Brands, engaging content and brand store, we were able to showcase our brand story and our mission and vision to our potential customers.”
To this, Pallavi Utagi, CEO and Co-founder, SuperBottoms, added, “As we pioneer a new category, educating our customers is crucial. Using engaging advertising formats like Sponsored Brands and Sponsored Brand Videos under the Cost-per-Click model, we can reach our intended audience without overspending. The user-friendly interface enables us to launch and optimize our ads independently, allowing us to grow without the heavy expense of external agencies.”
On a forward looking note, Amazon Ads’ study also highlighted that there is a clear belief in the power of technology to enhance the impact of advertising among India SMBs and to help them solve existing problems, as over two-thirds (67%) of India-based SMBs said they believe AI will improve the performance of their advertising campaigns. As a result, almost three in ten (30%) of those sampled are currently training their teams on how to use AI technology for advertising purposes.
