AN EXAMINATION ON THE IMPACT OF DIGITAL MARKETING AS A KEY DRIVER OF SALES AMONG SMALL AND MEDIUM SCALE ENTERPRISES
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- 1-5 Chapters
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- Mean and Standard Deviation
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- Reference Style: APA
- Recommended for : Student Researchers
- NGN 3000
BACKGROND OF THE STUDY
It is the goal of any enterprise, regardless of size, level of complexity, ownership structure, public or private status, etc., to provide goods and services at prices that are competitive. There are three different categories for companies doing business in Nigeria: small, medium, and big (Aaker ,2022). Nevertheless, the parameters of project costs, capital, number of workers, sales volume, yearly company turnover, and financial soundness may be used to describe a small-scale industry. To define what constitutes a small-scale industry, both the federal government and state departments of Industry and Commerce have agreed to use the criteria of value of fixed capital that has been placed. The fixed capital had ranged from as low as N60,000 in 1972, N159,000 in 1975, N250,000 in 1979, and N500,000 in 1986, to as high as N2,100,000 in 1992 and N5,100,000 by 2003. In all, the fixed capital had increased by a total of N5,100,000 by 2003. As a consequence of this reality, it is possible that there will be a need to divide the small-scale sector into micro and super-micro businesses with the intention of providing enough incentives and protection for the former (Aaker ,2022). In the meanwhile, the top limit for a small scale industry is set at N250,000, and a small scale industry is defined as any firm or organization with an annual turnover that is greater than that of a cottage industry, which is presently set at N5,000 per year. The threshold for what constitutes a "small-scale enterprise" according to the National Directorate of Employment (NDE) has been set at a maximum of N35,000.
The term "small and medium-sized businesses" (SMEs) refers to companies that are not subsidiaries, operate independently, and have fewer workers than a certain threshold. The exact figure varies from nation to nation. The most common upper limit for categorizing a company as a small or medium-sized enterprise (SME) is 250 workers, as is the case in the European Union. Nonetheless, the threshold for small and medium-sized enterprises (SMEs) in certain nations is set at 200 workers, but in the United States, businesses with fewer than 500 employees are considered to be in this category. Small businesses are often defined as having less than 50 workers, while micro-enterprises have no more than 10, and in certain circumstances no more than 5, employees. SMEs may also be defined in terms of their financial assets. On January 1, 2007, a new definition became effective throughout the European Union. This definition applies to all Community acts and funding programs, as well as the field of state aid, which allows small and medium-sized enterprises (SMEs) to be eligible for a higher intensity of national and regional aid than large companies. The new definition calls for an increase in the financial thresholds, which are as follows: the turnover of medium-sized enterprises (50-249 employees) should not exceed EUR 50 million; the turnover of small enterprises (10-49 employees) should not exceed EUR 10 million; and the turnover of micro firms (less than 10 employees) should not exceed EUR 2 million. Alternately, the total assets listed on the balance sheets of medium, small, and micro businesses should not be more than 43 million euros, 10 million euros, or 2 million euros, respectively (Aaker , 2022).
In recent years, the development of modern information and communication technology (ICT) has had a significant impact, not only on the practice of marketing but also on the practices of other professions. A paradigm change from analogue or primitive modes of transaction to a system in which nearly all marketing operations are carried out electronically has been required by advances in information and communications technology. Despite the fact that digital marketing is often confused with e-commerce and e-business, there is a significant difference between the three. While the primary focus of e-commerce is on selling online or the capacity to transact business online, digital marketing focuses on bringing businesses and their customers closer together and gaining a deeper understanding of their needs. It also emphasizes the importance of adding value to products, expanding distribution channels, and driving up sales through the use of digital media channels. E-business, on the other hand, refers to the process of using digital technology to enable organizations to know what their customers want and to produce only those products. This eliminates the need for guesswork and prevents the loss of money due to unsold inventory, allowing businesses to experience increased productivity, profit, and growth (Ayyagari, 2022). Digital business is another name for this phenomenon.
According to Ayyagari (2022), the glue that keeps workers, customers, and partners connected and informed is e-business, which is accomplished via digital marketing. It entails using self-service apps, which give pertinent information to individuals who need it, resulting in huge values being added to commercial transactions. The emergence of transaction tools on the internet, which affected a bigger number of phases compared to conventional transaction systems, has had a major influence on the buying and selling life cycles. These tools have affected a greater number of stages (Barnes, 2021). This demonstrates that both digital marketing and e-commerce are subcategories of E-business; hence, E-business is the umbrella under which digital marketing and e-commerce may be found.
Email marketing is one of the simplest, most successful, and most cost-effective strategies for any company to develop. This is due to the fact that it encourages repeat business from both existing consumers and potential new ones, both in terms of additional product demand and feedback on things that have previously been purchased. Therefore, the proprietor of the company or the entrepreneur may make reparations when they fall due and provide a higher level of satisfaction for the company's clients. You may strengthen your connections with clients and prospects by maintaining consistent contact with them via the use of aesthetically pleasing and professionally designed email correspondence. When compared to other types of digital marketing techniques over the course of history, email advertising is by far the most personal (Barnes, 2021).
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