72% of Indian SMBs currently invest in advertising: Amazon Ads Report

New research from Amazon Ads shows that Indian small and medium-sized businesses (SMBs) are benefitting from the positive impact of advertising as they look to expand both at home and internationally. The study found that nearly nine in 10 (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. More than two-thirds (69%) said that advertising had helped them grow their business internationally within the last 12 months.  

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. The most common motivations for this increase in spend include driving awareness of a new product or service (42%) or improving customer awareness of their brand (50%). Looking ahead, more than a third (36%) of those sampled said they planned to spend on streaming TV advertising during the next 12 months.

Of the 300 SMBs sampled, almost three-quarters (72%) of those sampled said they currently spend on advertising, compared to 28% that do not spend on advertising at all. 

Despite the success enjoyed by some, not all SMBs feel they need advertising to grow their business.

28% of Indian SMBs do not currently spend on any kind of advertising. When asked why they are not currently advertising, the most common response 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. Three 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. 

“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,” said Kapil Sharma, Director, Growth Customer Sales, Amazon Ads India. “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. 

There is a clear belief in the power of technology to enhance the impact of advertising among Indian 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.