Google Hong Kong has partnered with the Hong Kong Trade Development Council (HKTDC) to power SMEs’ digital capabilities and help them succeed globally in 2022 and beyond. Michael Yue, general manager, Sales & Operations, Google Hong Kong, explains how it will work.
What did the research reveal?
During this extended pandemic period, Hong Kong’s SMEs have built resilience by diversifying their revenue and global footprints. They are accelerating the uptake of e-commerce and digitalisation for their business. The data confirms this: Hong Kong’s merchandise exports registered 21.4% year-on-year growth in October 2021 and 25% year-on-year growth in November 2021.
As part of Google Hong Kong’s Smarter Digital City initiative, our “Smarter Digital City – a Refreshed Look at Export” report conducted by Ipsos shows that the global revenue share of the city’s exporters has increased by nine percentage points, from 26% to 35%, amid the pandemic. With exports poised to aid the city’s economic recovery, 68% of the surveyed small and medium-sized exporters plan to pilot new markets, and 62% are considering Southeast Asia as an attractive region.
What do these results indicate?
Hong Kong businesses are always resilient and creative, and over the last year exports continued to be a key driver to economic recovery. This report clearly underscores the growth potential of export markets and explains how exporters thrive with increased digital capabilities.
What practical assistance can firms draw on?
We recently launched the Google Export Program together with the HKTDC’s T-Box. This provides small and medium-sized exporters with Google Ads credits, Google Workspace special offers, e-commerce support from SHOPLINE, plus a combination of training, consultation and other best practices offered by industry experts. We hope the programme will better support Hong Kong exporters in capturing growth opportunities globally.
What doors does this open to SMEs?
As said earlier, the majority of small and medium-sized exporters we surveyed consider Southeast Asia as an attractive region for expansion. At the same time, according to “Google, Temasek and Bain, e-Conomy SEA 2021”, Southeast Asia has 350 million digital consumers who made at least one purchase online, propelling its internet economy to reach US$170 billion GMV (gross merchandise value) in 2021 and is expected to reach around US$360 billion by 2025. It is increasingly important for exporters, especially SMEs, to strengthen their digital capabilities and capture this growth momentum.
For exporters that already enjoy an online presence, leveraging different tools in Google’s advertising suite can help them accelerate their business growth and drive awareness. Through adaptive analytics, business owners gain insights that allow them to understand where their customers are coming from, to improve ads’ efficiency, and to better plan their business.
What obstacles do they face?
From our report, Hong Kong exporters have seen the benefits of going digital, especially in increasing market share. Some 68% of exporters plan to increase their digital investments in 2022, and nine out of 10 exporters planning to grow digital investment next year are optimistic about growth.
When asked about key barriers to going global, Hong Kong exporters mentioned marketing (28%), policy and regulations (19%) and business operations (18%). In particular, small and medium-sized exporters are more likely than corporates to experience these barriers.
Digital upskilling emerges as a common need. It is essential that exporters learn and adopt tools and cloud-based solutions at all stages of their journeys in export business, ranging from conducting market research and attracting new customers, to building customer loyalty and operational efficiency.
How can players in the trade ecosystem better support exporters?
Policymakers and public and industry organisations also play a vital role in SMEs’ global journeys. For example, key public and industry organisations can utilise their global network around the world to help SMEs navigate through foreign policy and regulatory environments. At the same time, government offices or partnerships set up in key export markets can offer on-the-ground support for Hong Kong businesses and promote Hong Kong as a reliable source of goods and services.
In addition, policymakers should establish digital economy partnership agreements with key trading partners that will help exporters ensure that data can flow freely across borders in a secure and privacy-protective manner. This should be coupled with the ongoing active negotiation of global digital trade rules at the World Trade Organization to ensure that Hong Kong businesses’ own digital interests are promoted.
The Transformation Sandbox (T-box) system SME support programme helps businesses enhance competitiveness and achieve transformation goals in the areas of branding, e-commerce, manufacturing and supply chain solutions and new markets.