As economies around the world continue to face the impact of Covid-19, technology and connectivity are crucial to help people stay connected, enable health authorities to deliver important public health information at scale, and drive inclusive economic recovery of business and trade, said Facebook COO Sheryl Sandberg.
She was speaking at the first virtual Asia Pacific Economic Cooperation (APEC) Leaders Meeting on post-Covid priorities for the region, attended by Tan Sri Dato’ Haji Muhyiddin bin Haji Mohd. Yassin, Prime Minister of Malaysia, as well as other dignitaries and leaders from around the region.
Sandberg noted the pivotal role of digitalisation in building the resilience of small medium businesses (SMBs) which are the backbone of APEC economies, accounting for about 40 to 60 percent of their GDPs.
A joint study conducted by Facebook, World Bank and the OECD shows that globally, 15 percent of SMBs have closed operations and those who have reopened and survived are facing financial pressures and reduced demand. Women-owned SMBs were more likely to report that they were closed, even when taking into consideration factors such as size of business, sector, and geography.
Given APEC’s focus on putting women at the centre of economic recovery in the region, the study shows that women are disproportionately bearing the burden of domestic responsibilities. On average over the study period, 23 percent of all female business leaders stated that they spent six hours or more per day on domestic responsibilities, compared to only 11 percent of males.
Yet the study also found that female business leaders demonstrate flexibility in their business models in response to Covid-19 and were more likely to make more than 50 percent of their sales through digital channels.
This figure is significant given the study shows that more than 40 percent of SMBs in the majority of the regions made more than a quarter of their sales through digital channels.
In another recent study on digital tools, Facebook and Deloitte shared that 77 percent of the SMBs studied globally indicated they started using or increased their usage of digital tools at some point in the customer lifecycle, with social media and online messaging experiencing the most growth during the Covid-19 crisis. In Malaysia, for example, 56 percent of operational SMBs reported 25 percent or more of their sales were made digitally in the past month.
The analysis demonstrates that, of those now-open SMBs that closed at some point during the pandemic, an increase in digital tool usage was associated with shorter closure periods.
Furthermore, those that increased their digital tool usage were nearly four (3.8) times more likely than other SMBs to be targeting new customers with their marketing efforts, potentially tapping into new markets and new sources of revenue.
Take for example, a Malaysian online florist, BloomThis that was founded by Giden Lim and his wife, Penny Choo, who helped out in his mother’s flower shop when he was growing up. They grew their business by doing same-day flower deliveries and subscription service to deliver luxury flowers straight from the farm.
When the pandemic hit and movement restrictions were imposed, they could no longer import flowers, and demand for flower deliveries shrank dramatically. Revenue dropped by 90% as the main source of revenue like weddings and other events were cancelled. In time however, they were able to recover the business through the launch of new products, and promoting them through personalized ad campaigns. In fact, BloomThis is seeing better sales now than they were a year ago.
For many businesses like BloomThis, personalized advertising – which uses data safely and in a privacy-protected way – is the secret ingredient that makes success possible. In his own words, “Covid-19 has definitely hastened the need for digital transformation. Facebook has become an even more important enabler for SMBs like us to continue to reach customers effectively and remain connected. They have been a very important partner to BloomThis and have helped us navigate through this pandemic successfully and thrive,” said Giden Lim, Founder and CEO, BloomThis.
“The pandemic has proved the value of connection, cooperation across borders, and the economic opportunity created by an open, accessible internet. We should give everyone the opportunity to be part of this digital future. We will continue to invest in digital literacy programs, online education, and improve connectivity for people in remote communities so that we can together build a thriving digital economy that will power Asia-Pacific for years to come,” Ms Sandberg said.