Canadian Manufacturing

Tap into digital wealth

How to access international markets using the web

OTTAWA— Small and medium-sized businesses aren’t maximizing the potential of the digital economy, according to a recent report from the Conference Board of Canada.

The report says as of 2007, only seven per cent of Canadian small firms were selling online, a figure that has barely edged up since 2001, according to Statistics Canada.

Online sales among mid-sized enterprises was just slightly higher at 13 per cent.

That could be mean lost international opportunities, says Eileen Fischer, the report’s co-author and the Max and Anne Tanenbaum Chair of Entrepreneurship and Family Enterprise at York University’s Schulich School of Business.

Fischer says the web makes financial transactions faster and cheaper, but it also helps companies exchange or mine information.

Toronto-based Polar Mobile — a mobile and media technology company that conducts 90 per cent of its business in North America — wasn’t selling online, but it still found a way to broaden sales using web analytics.

“They found they were getting hits on their site from South Korea, a place they had never considered as a customer base,” Fischer says.

Any success in digital markets requires careful planning that starts with investing in strong technological capabilities.

“Online processes need to be seamlessly integrated. If it’s done badly, it can alienate customers,” Fischer says.

Another recent report, from J.D. Power and Associates, confirmed that a well built website has a direct impact on company sales.

It analyzed shoppers habits on several auto manufacturer websites and found people are increasingly seeking a smoother online shopping experience, including proper placement of “next” buttons and more variety and detail in vehicle images.

“Without proper navigation to move shoppers through the process expediently, they will likely be confused and disappointed,” says Ryan Robinson, Canadian automotive practice leader at J.D. Power.

Highly satisfied online shoppers were three times more likely to visit a manufacturer’s showroom, he points out.

You must also know your clients and tailor the website to their needs.

The U.S. is ClearFit’s strongest market. The Canadian online hiring solutions provider uses American pricing and payment while highlighting media and testimonials from south of the border.

Other companies are using social media to connect with foreign markets through online communities.

Customers are invited to participate in online forums sponsored by the company, tweet about the company, or create YouTube videos that show the products they love or hate.

This kind of global engagement signals to international buyers that the firm serves customers effectively in any region.

But as more businesses expand online and turn to cloud computing — the use of multiple server-based resources — to save costs and time, they should weigh the security risks involved, says Bernice Karn, a partner in the Information Technology Group at Cassels Brock & Blackwell LLP.

In the cloud environment, virtualized servers exist on one physical box, so there’s always the possibility of one neighbor accessing another’s data, either accidentally or deliberately.

“Companies that are entrusting sensitive data to the cloud, such as credit cards or other personal information, should be especially diligent,” Karn says.

Cloud users can protect themselves by researching the service provider, ensuring it has the proper security measures in place and checking any audit reports that are available.

It’s not just up to businesses to ensure the transition to online goes smoothly. Canada too must play a bigger role in connecting companies to the web.

The Conference Board points out that Canada currently lags behind other countries when it comes to providing high capacity networks at a cost SMEs can afford.

It says in order for government to design the right support programs for companies, it first needs more data on how businesses use the web, including why some don’t.

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