Digital investment by UK SMEs set to increase by £53bn

UK SMEs1 are collectively planning to increase investment in their digital capabilities by £53 billion over the next two years, prioritising their websites over mobile technologies, according to new research2 from Santander Corporate & Commercial.

The survey of UK SMEs reveals the average firm has committed £33,212 to digital investment in the past year, and intends to increase this by £28,224 in the next two years. However, many firms are looking to invest significantly more: 8% of the companies surveyed estimated they had spent more than £100,000 on digital capabilities in the last year, while 6% plan to increase their investment by over £100,000 in the future.

Leading the way, the financial services and IT sectors have spent the most over the past year, and this is expected to continue. On average, IT companies have invested £46,429 in the last year, while financial services companies have each invested £49,500. Over the next two years, IT firms typically plan to increase this by £43,962, while financial services companies expect to spend £42,083 more.

Regionally, firms in London are set to invest the most at £42,925, which is significantly ahead of businesses in the Midlands in second place at £31,531. Businesses in the South West are, according to the research, looking to invest the least at £19,500.

Approximately how much, if anything, are you planning to increase your company’s investment in digital capabilities over the next two years?

Stephen Dury, Managing Director, SME Markets & Business Development, Santander Corporate & Commercial, said: “Investment in digital capabilities can significantly enhance business growth opportunities for small and medium-sized businesses. Just having a functional website can have a dramatic impact on a firm’s visibility and connectivity with customers and other stakeholders. However, while it is great to see that many firms are focused on this, the concern is that a significant number are still failing to invest effectively and are therefore missing out on these opportunities.”

Despite the growth of mobile technologies, traditional websites remain the top digital priority for SME owners, according to the research, with nearly three-fifths (56%) of firms saying their websites are making their businesses more successful. However, one-sixth (16%) of SMEs say they do not have a website at all, while just 34% can currently accept payments online, and only 13% host a foreign-language version of their website.

Just over a half (54%) of firms investing in digital capabilities are looking to develop their websites compared to just 16% who are launching digital apps. A further 13% plan to develop online payment facilities, while 10% will be launching websites for the first time and 10% plan to launch foreign language versions of their website to access new markets.

Santander Corporate & Commercial has put market-leading digital functionalities and services at the heart of its proposition for its SME clients. To help businesses trade internationally, for instance, Santander Corporate & Commercial offers the Trade Portal, a comprehensive, data-rich online platform which allows them to research global markets, and the Trade Club, a network of five million SMEs based all over the world that bank with Santander.

Stephen Dury, Managing Director, SME Markets & Business Development, Santander Corporate & Commercial, said: “Santander is committed to helping UK businesses prosper. As a scale challenger, we are bringing much-needed competition to the banking market with what we believe is a unique approach to UK businesses. Our success is evidenced by four years of double digit growth in lending and support to UK companies. We also continue to invest in technology, digital, product and customer service improvements which underscores our desire to be the bank of choice for UK SMEs.”