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WORKING PAPER

Conception and orientation of a digitalization of Swiss SMEs

Introduction

Personalizing offers and better targeting customers is one reason why marketers and sales managers need
to consider the data available on their prospects and customers. Companies have to manage communication,
sales and personal life on the Internet, and all these things can influence each other. Sales sites, social
networks, community sites and blogs are all ways that people use the Internet, and these things need to be
considered when developing a company's strategy. It is important to think about the different digital tools
a company will use before launching any action on strategy. SMEs in French-speaking Switzerland are not
taking full advantage of digital marketing, say studies in the field of digital marketing. Small businesses
don't have the knowledge, time, resources or know-how to properly use digital marketing tools. This article
tries to find out what challenges SMEs in French-speaking Switzerland face when trying to transform
themselves digitally, what their needs are in terms of digital marketing skills and their digital maturity. The
question posed by this article is: Do French-speaking Swiss SMEs have the resources to be considered
digitally mature? The digital age has caused consumers to change their behavior and many companies have
become more competitive with their digital offerings. Both of these aspects have driven small businesses
to go digital, as the results of our study indicate. The first chapter of this research discusses the literature
review. The second chapter details the methodology used in this study and the findings. This study examines
why SMEs are going digital and describes some of its advantages and disadvantages. The study also
considers some of the limitations of this research.

Literature review
The importance of digital marketing
Dabi-Schwebel says the ability of companies to change their organization by adding new technologies is
called digital maturity. This can be measured by the leadership ability of the company's executives and the
company's technology investments.

Digitalization of Marketing
Marketing is changing into a digital form, or marketing is going digital. This change is called the
digitalization of marketing (according to definitions-marketing.com). The website explains that Bertrand
Bathelot, associate professor of marketing, gave a definition of the digitization of marketing in 2016,
explaining that it is the process by which more and more marketing activities are becoming electronic, and
that the majority of marketing efforts and money are expected to move toward this form in the near future.
This can be illustrated by the digitization of old media forms such as point-of-sale systems, customer
journeys and even traditional advertising. Marketing and branding methods are constantly evolving, using
digital tools and techniques to adapt how they communicate with customers and attract long-term brand
loyalty. Florés (2016) defines digital marketing as "the development of methods and techniques that no
longer only use the Internet on websites, but use applications that can be accessed on any device (computer,
tablet, phone) to produce services that link directly back to a business or commercial entity."

Digital maturity Features

levels

Immature  Absence of the website

 Presence in an online directory (e.g. Yellow Pages)

Beginner  Provision of a rudimentary interactive site to obtain information

about the company and its products/services and to contact the
company through the contact form

 Use of some digital tools without being accompanied by a digital

development strategy

 Organization in silos

Intermediate  Layout of an interactive site offering several functions:

 Transactions with clients ;

 Sharing blog posts or product pages on social networks

 Establishment of a real digital marketing strategy

 Seek expertise from communication agencies or consultants

 Advanced  Layout of an interactive site offering several functions:

 Transactions with customers

 Sharing blog posts or product pages on social networks

 Implementation of an interactive help desk (e.g. click to chat)

 Active presence on social networks, mobile site and/or

application

 Interactive communications on traditional media (QR codes in the

press, digital display,...)

 Use of data analysis technologies and techniques

 Optimization of marketing actions such as , for example,

the personalization of offers with segmentation

Table 1: Summary of the main characteristics of the digital maturity levels

Marketing activity in SMEs

SMEs operate more loosely and chaotically than large companies, and marketing practices in SMEs often
differ significantly from the marketing theories presented in textbooks. Small businesses lack formal
processes and systems such as market research and sales and marketing planning, unlike large companies.
The Internet and digital marketing tools have changed the game, but many SMBs have not responded to
these changes and are not using these tools effectively.

Authors

Opportunitie Measurability of marketing actions Järvinen et al (2012)

s
Royle and Laing (2014)

Automation of repetitive tasks Baumeister (2002)

Backup and security of data Baumeister (2002)

Hirth (2017)

Development of activities on a large Chaffey et al (2014)

perimeter
Taiminen & Karjaluoto (2015)
 New distribution channel Chaffey et al (2014) Gilmore et al
(2007) Järvinen et al (2012)

Taiminen & Karjaluoto (2015)

New means of communication Chaffey et al (2014) Gilmore et al

(2007) Järvinen et al (2012)

Taiminen & Karjaluoto (2015)

Tiago and Veríssimo (2014)

Threats Business model change Leeflang et al (2014)

Lack of control over the social media Järvinen et al (2012)

environment
Leeflang et al (2014) Verhoef et al
(2013)

Table 2: Summary of opportunities and threats of digital marketing adoption

The shift from traditional to digital marketing is having an effect on all aspects of the business environment.
This study must identify these changes, in order to answer question #1:

Q1: Do SMEs in French-speaking Switzerland know the impact that digital marketing has had on their
environment?

Factors influencing the digitalization of marketing

The adoption of digital marketing by small businesses has been the subject of much research. Both external
and internal factors are seen as influencing the decision, either helping or hindering adoption. Taiminien
and Karjaluoto researched this topic in 2015, noting that these factors can work against each other.

Internal drivers of digital marketing adoption

According to Taimien and Karjaluoto, the marketer's knowledge of existing digital marketing options and
personal interest determine whether small and medium-sized businesses adopt digital marketing tools. The
primary goal of SMB marketing departments is marketing effectiveness, according to a survey of marketers
at large U.S. companies conducted by Ad Age CMO strategy/Foresster. Marketing managers want to
maximize the ROI of their marketing campaigns, so they refrain from using expensive or difficult-to-
measure digital tools in favor of social media and other digital platforms. There are many things that can
influence a company to adopt digital marketing. These are considered resource factors, as they can slow
down or hinder the progress of digital marketing projects.
External drivers of digital marketing adoption
According to Taiminien and Karjaluoto, companies that were Born Digital are competing with larger, more
traditional companies. These companies need to use digital marketing tools because of the external
environment of their business, including changing consumer behavior and increased competition. Even
larger, more traditional businesses need to consider adopting digital marketing methods as they face
competition from these Born Digital companies. According to Autissier and Metais-Wiersch, traditional
businesses need to merge their old methods with new digital methods by using digital tools or creating new
products and services with digital marketing. The financial and retail sectors need to integrate digital
marketing because of customer behavior, according to more than half of the executives interviewed in a
survey of 13 Finnish companies. The Internet has become more democratic and many people are using new
communication technologies, forcing merchants and financiers to add digital tools to their marketing
strategy. Different products and services determine whether a company will add digital tools to its
marketing strategy. Some products and services are better marketed through digital marketing, while others
will only be marginally involved, and others still will not be involved at all. Partial outsourcing of social
media tools has been seen as a good way to start using digital marketing techniques.

Authors

Internal factors Capabilities, motivation, training Barbero et al (2011)

and experience of the manager
Taiminien and Karjaluoto (2015)

Internal efficiency Florés (2016)

Tiago and Veríssimo (2014)

Resource- Human, financial, technical and Gilmore et al (2007) Järvinen et al

related factors time resources (2012)

Taiminien and Karjaluoto (2015)

External factors Competition Autissier and Metais-Wiersch

(2016) Taiminien and Karjaluoto
Changing consumer behavior
(2015) Tiago and Veríssimo (2014)

Type of products / services Autissier and Metais-Wiersch

Industry (2016) Karjaluoto and Huhtamaki
(2010)

External support Järvinen et al (2012)

Taiminien and Karjaluoto (2015)

Table 3: Summary of digital marketing adoption factors according to the authors

Why are small businesses in French-speaking Switzerland going digital? This is the question to be answered
in this study.

The challenges of digital marketing

Companies embarking on a digital transformation project must consider many cultural challenges and
methodological changes. The project is very broad and requires workers to change their habits and attitudes
using digital methods. Workers must be mobilized. In addition, the project requires organizational change.
American Express marketing director John Hayes said in his testimony, "Marketing now affects many other
parts of a company, both product and service development. We need to structure ourselves in a way that
eliminates the rigidity that exists in most companies today." According to the McKinsey study, an
organization's lack of flexibility can prevent a digital transformation project from being successful.
Ngiamba wrote in his 2017 article that highly structured companies with hierarchy and decision-making at
the top can have a hard time making the transition to digital because digital systems are much more
collaborative and horizontal in nature. Moving to digital marketing presents many challenges for
companies, according to Leeflang et al. Tensions exist between the marketing department and other
departments in the company, as many companies are not ready to make drastic changes within their
organizational structures. Marketing needs to cross functional lines in the digital age, the article's authors
explain. This helps manage the ambiguity and misalignment of roles between marketing and other
departments. This has a positive impact on business performance, such as successful new product launches.

The use of digital marketing tools

Some studies focused on a few digital marketing tools, while other studies focused on a specific type of
business. Gilmore, et al. examined the impact of the Internet on the marketing strategies of small businesses,
and Taiminien and Karjaluoto conducted the same study looking at the impact of digital channels on the
success of small businesses in Finland. For Cegos' marketing director, marketing and technology are more
linked than ever. Many new marketing practices are being developed thanks to new technologies. Social
networks, branded content, content marketing, the Internet of Things, Big Data, customer relationship
management marketing and data management platforms all offer marketers ways to better serve their
customers.

The objectives of using digital marketing tools

The Digital Marketing Toolbox book has compiled a list of digital marketing tools, along with their uses.
These tools include social media, website, natural search engine optimizations, paid search engines,
customer relationship management tools, and mobile apps. This was a review of all the tools marketers use
in digital marketing.

Tool family Primary objectives Usage objectives for the company

Social Share information with the Generate additional traffic (increase

networks community awareness)

Recruit and retain a community Generate new leads

of subscribers
Recruit human resources Improve
natural referencing (SEO)

CRM Centralize customer data Assist in strategic decisions

Understand customer preferences
Analyze customer behavior Manage
Customer Reporting / dynamic reporting customer interaction
Relationship
Improve customer service
Management
Have a business process (sales,
marketing, service)

Referencing Generate traffic to the website Generate conversions based on

objectives (sales, registration,
downloads, etc.)
Increase visibility (better ranking
by search tools)
Analyze current trends (keywords)

Website Entry point for prospects Converting visitors

Increase awareness / visibility Improve the company's image

Worldwide

Provide information on
products/services
 Interact with prospects/customers

Mobile Collect customer data Develop a new service for customers

applications

Improve the company's image

Diversify communication channels

The digital marketing toolbox book, by SMEs in French-speaking Switzerland use digital marketing tools?
We have listed all the digital marketing tools available, as well as the reasons why a company would use
them. Now we have to ask ourselves, how do SMEs in French-speaking Switzerland use digital marketing
tools? The book has identified the objectives for which each tool is used, so that companies can compare
their objectives with what they have predetermined the tool for.

The effectiveness of digital marketing

Companies are focused on providing good service and achieving their goals. They need to measure the
impact of digital marketing tools on their performance and the impact of the Internet on their sales,
branding, marketing, customer relationships, information exchange costs and marketing activity. Gilmore
et al. conducted a study measuring the impact of Internet use on sales, customer relations and marketing
activity. It appears that small businesses are not effectively using digital tools for marketing. EBG
conducted a study in 2014 that showed 47% of respondents were not satisfied with their ability to measure
the performance of their digital marketing. The researcher also mentioned that before any marketing action
is launched, the choice of qualitative or quantitative metrics must be decided. This is an important step in
measuring the effectiveness of a campaign or marketing performance. However, many KPIs are not linked
to the set objectives, which can have a negative impact on the performance of a campaign, which is a
measure of effectiveness. The ability of small and medium-sized Swiss companies to measure the
performance of digital marketing tools was studied in this work. The question asked was: Q5: Can SMEs
in Switzerland measure the performance of digital marketing tools?
Methodology - Results - Recommendations
Methodology
The data collection method, sample structure, and analysis method are all described in this section of the
paper. This includes the research strategy that was used, as well as details about the data collected.

Research strategy
Small and medium-sized companies in French-speaking Switzerland are in transition to digital marketing,
and this study aims to understand the issues involved in this transition. The nature of the question this
research attempts to answer allows for a qualitative approach, which can be described as inductive,
comprehensive and constructivist. This type of methodology helps to provide an in-depth understanding of
the perceptions and decision-making processes of managers working on digital marketing for their
companies. Because SMEs in French-speaking Switzerland have specific characteristics, a qualitative
approach is the best method to use to analyze the marketing efforts of SMEs in the digital age.

Data collection
The data was collected in Switzerland, where French is spoken, over a period of two months at ten different
companies. Four of the ten people who contacted the company declined due to the company's privacy
policy. According to Barribal and White, this type of interview is ideal for obtaining in-depth responses
and clarifications, and probing questions about respondents' opinions and perceptions. The interview was
structured around five key topics drawn from the literature review: The state of marketing in small and
medium-sized companies in French-speaking Switzerland. The digitization process in SME marketing,
including the tools used, their purpose and their effectiveness. The company's digital strategy and culture.
The interviews asked SMEs how their marketing was digitized within their company, and what the key
competencies and organization of the marketing department were. Focus groups were also conducted to ask
open-ended questions about participants' experiences with digital marketing. In-depth interviews provided
managers with detailed answers about their perceptions and experiences with digital marketing, and focus
groups helped organize the data collected.

Structure of the sample

The companies surveyed were chosen with a predetermined intention: to inspect companies that are already
going through their digital transformation or those that are considering it, but have not yet fully integrated
digital marketing tools. The companies in the focus group consisted of companies with between 50 and 250
employees operating in the following sectors: banking and finance, machinery and equipment, electrical
industry and business services.

Figure 1: Interviewee Profiles

Figure 2: Characteristics of the sample

Method of analysis
The interviews were recorded and the main ideas of each participant were noted after each interview. The
participants' comments were then analyzed and coded. The thematic analysis process was used to code the
comments into themes in the text. These themes were used to support the analysis of the topics in the article,
as described by Régnier (2006). In 2009, Frutuoso wrote about content analysis as one of the methods and
techniques that make up the set (p. 164). The original set of themes and notes that they discussed can be
found in the book.

Results of the study

SMEs in French-speaking Switzerland have observed the opportunities and threats of digitalization in this
part of the report. The main drivers and barriers of digital transformation, as well as the objectives of using
and improving the efficiency of digital marketing tools will also be discussed.

The current state of marketing activity in French-speaking Swiss SMEs

Figure 4: Digital maturity level of the SMEs interviewed

Figure 3: Percentage of digital marketing budget in relation to overall marketing budget

Companies allocate their marketing budgets between traditional and digital marketing tools, depending on
their maturity in using digital tools, as well as different marketing campaigns. Companies that are new to
digital tools tend to allocate their budgets less significantly, while customer retention, competitive analysis,
and lead generation are areas where companies tend to use digital marketing tools less. Ten of the
companies surveyed allocate less than 25% of their marketing budget to digital marketing tools. Of the 100
companies surveyed, 10 spend more than half of their marketing budget on digital marketing (internet and
social media). The other 90 spend 25-50% of their budget in these areas. Figure 3 shows how many
companies spend a large portion of their marketing budget on digital marketing. Two in ten companies have
more than 6 people in their marketing department, and the other 8 communicate directly with the marketing
department. About two in ten companies have a strong digital marketing culture. These companies are fully
immersed in the digital marketing transformation on a daily basis. Three companies that are still exploring
digital marketing strategy and development do not yet have a solid strategy. The business owner is often
the marketing manager for companies with less than 15 employees. Some companies operate in the same
industry but have different levels of digital maturity due to their business types and industries. These
companies focus on data organization, process improvement and digital strategy development. While some
companies in the same industry focus on digital growth, others feel that transformation is not as important
in their industries. E3 is a for-profit company, while E10 is a nonprofit organization. Some companies in
certain industries are making more progress on their digital marketing projects than others. Companies in
the telecommunications, media, and technology sectors are making good progress.
 Company Activity sector Type of Size Maturity levels
code company

E1 IT Services B2B 80 Advanced

E2 Print media B2C 100 Intermediate

E3 Transport & Logistics B2B 180 Beginner

E4 Communication and Telecoms B2B/B2C 50 Intermediate

E5 Pharmaceutical industry B2B 200 Intermediate

E6 IT Services B2B/B2C 35 Intermediate

E7 Maintenance B2B/B2C 15 Beginner

E8 Communication and Media B2C 10 Advanced

E9 Catering B2C 15 Beginner

E10 Transport and Logistics B2C 10 Intermediate

Table 5: Level of digital maturity by industry, size and type of company

The opportunities and threats of digital marketing

Figure 5: Opportunities for digital marketing

Eight out of ten companies believe that protecting and securing customer data is an opportunity offered by
digital marketing. Six out of ten companies believe that automating time-consuming tasks and processes is
an opportunity offered by digital marketing tools. Overall, the study surveyed several companies and
revealed many of the opportunities that digitalization can offer, but also some of the threats it can create.
When a company uses digital marketing tools, they can see which campaigns are most effective, as they
can identify their audience and calculate the ROI of their ads and online marketing. 91% of companies
believe that digital marketing allows for better tracking and reporting of marketing activities. Businesses
can expand on a larger scale, nationally, internationally and even regionally. The social media environment
cannot be controlled, which can lead to a bad reputation for a company. Companies are competing with
each other because they have access to each other's information online. Ten out of 100 companies believe
that employees who are unwilling to use digital tools could pose a threat to digital transformation. Six out
of 100 companies thought cyberattacks and legal problems could occur because of digitalization. And six
out of 100 companies thought the reason their employees were willing to gain digital knowledge was
because they were informed of the benefits in advance and spread the word throughout the company.
Twenty companies were asked about technology agility, and three of them saw it as a threat to the
digitalization of their business. Managers know that new technologies and digital methods are impacting
small business marketing, and they are concerned that their companies will not be able to keep up with the
changes.

Automated tasks Number of

companies

Automatic sending of newsletters 5

Publication of content on social networks 3

Exchange of information between the sales and marketing teams 2

Automatic transmission of qualified leads to the sales team 1

Table 6: Tasks automated by the SMEs interviewed

Factors influencing the digitalization of marketing within SMEs

Figure 7: Internal and external factors of marketing digitalization

The digital revolution is placing tremendous competition on businesses that don't embrace digital
marketing. Customers are increasingly using digital media and communicating online, and if companies
don't change their marketing, their competitors will overtake them. Both internal and external factors have
driven companies to make the change, with customer behavior being the most important factor in digital
marketing. Ten out of ten companies that use digital marketing said that support and follow-through from
communications agencies was a factor in their decision to use digital marketing. Communication agencies
provide support and follow-up for companies working in a specific field, and are used by ten out of ten
companies that use digital marketing.

The challenges of digital transformation

Small businesses often don't have the time, resources, or skills to make a digital transformation. It requires
a lot of money and personnel, which can delay the process for SMEs.

Cultural challenges
Some employees at one company are not happy with the changes that are occurring, while the other half of
the companies surveyed said that all of their employees are happy with the transformation that is taking
place. The changes are making some workers nervous and influencing the way companies perform their
work.
Organizational challenges
Inbound marketing encourages collaboration and lead sharing when departments can freely exchange data
through the digitalization of inbound marketing within a company. Many companies separate themselves
based on their offerings, but using digital internal marketing helps break down those walls and bring
different departments together. Currently, six companies are using collaborative tools in their digital project
(such as editing documents together, sharing calendars with different departments, etc.), five companies are
using instant communication tools (such as chat rooms, video calls, etc.), and three small companies in
transportation, maintenance, and catering are only using traditional forms of communication (email, phone
calls, in-person meetings).

Figure 8: Communication tools used by the marketing team with other teams

Technological challenges
When a company starts a digital project, managers have to implement digital tools and software. Sometimes
the software chosen is not what the company hoped for, which can cause problems for managers. The
company has a hard time deciding what criteria to use to select the CRM software. The complexity of data
centralization and analysis tools confuses companies, according to the companies surveyed in Table 7.
Companies choose a CRM based on the following criteria:

Number of
companies
Criteria

Tool performance 10

Important Compatibility with the company's IT structure 5

criteria
Possibility to try the tool 5

Support and sustainability of the company 10

Reputation 10

Auxiliary Price 5
criteria
Simplicity and ease of use 5

Table 7: Criteria for choosing CRM software according to SMEs

10 out of 10 companies say that the performance of the CRM tool is an important factor in their decision
to purchase the tool. 5 out of 10 companies believe that the tool should work well with their current IT
system, and some even suggest testing the tool before purchasing it. Five out of 10 companies say that price
is not an important factor in their decision, but for smaller companies, price is one of the key factors they
consider when making a purchase. In addition, 5 out of 10 companies say that the ease and simplicity of
using the tool is another factor they consider when deciding which CRM to buy. For large companies, this
consideration is secondary.

The objectives of using digital marketing tools

Some small businesses feel that developing a digital marketing strategy is a waste of time or that purchasing
digital tools is too expensive. Instead, they focus on meeting customers' needs on a daily basis without
using digital strategies or tools. Three out of 10 small businesses don't even have a digital strategy or tools
but still use them spontaneously. According to the study, websites and social media sites are the two most
important marketing tools for businesses. Companies need to understand the digital world and know how
to use these tools. Social media can help businesses connect with their customers, improve their brand
image and convert people who visit their website into paying customers. Each business should choose the
social media platform that best suits their brand and target audience. Businesses can use SEO tools to
analyze keywords and increase their online content presence, thereby increasing website traffic. They can
also use CRM tools to store data and analyze customer behavior, which can help companies make better
strategic decisions.

The effectiveness of digital marketing tools

More and more companies are investing in digital marketing each year, despite the fact that 5 out of 10
companies reported that their digital marketing budget increased in the previous year. Companies that have
invested more in digital marketing at the expense of traditional marketing tools believe that digital activities
produce the best return on investment. However, many companies fail at marketing because they don't set
clear goals before launching their marketing campaign. The manager of E7 explains, "Our Facebook page
is used without a clear goal. Sometimes we post about holiday greetings or job openings. Another problem
with digital marketing is that many people don't have the skills to analyze the data.

Summary and recommendation

Synthesis
In French-speaking Switzerland, small businesses understand how digital marketing can affect their
environment. The change in business model was not considered a risk, as small business owners do not
believe that digital marketing can influence their business model. The results of this study are consistent
with the findings of Autissier and Metais-Wiersch, Järvinen et al, Taiminien and Karjaluoto, Tiago and
Veríssimo regarding the reasons why small businesses use digital marketing techniques. They indicate that
factors such as changes in consumer behavior, increased competition from digital startups, and managers'
desire to do so motivate SMEs to start using digital marketing techniques. Bottom-up decision-making by
employees may be a reason a brand would decide to make the switch to digital transformation, according
to participants in this study. Participants also said that the tools used for digital projects might be difficult
to use for some SMBs and that best practices might not be practiced well. The figure below shows what
SMEs have to say about their difficulties in using the tools and practicing the best practices.
Figure 10: Components of digital maturity

In order to achieve advanced digital maturity, SMEs must have these three elements: human capital,
processes and technology

• Management members enthusiastic about the digital project

• Employees made aware of the benefits of digitalization
Human capital
• Availability of digital marketing skills (e.g. analytical skills, content
creation, graphic design)
• Knowledge of the opportunities and threats of digitalization
• Involvement of the employees in the decision making process of the
digital project (e.g. choice of tools)
Process
• Establishment of the digital culture
• Definition of a digital strategy
• Development of an efficiency measurement plan
• Acquisition of tools to optimize the business process

Technology • Training of employees in the use of the tools

• Deployment of good practices to employees
Table 8: Summary of elements needed to achieve digital maturity

Recommendation and limit

Marketing and sales managers and small business executives can use this study to help them lead their
company's digital transformation. They would start by selecting people internally who they think would be
good ambassadors for the project, and include them in decision-making meetings. Perhaps hold
brainstorming sessions with other employees to develop the digital marketing transformation path for the
company. This study provides more detailed information than previous studies on the classification of
marketing tools based on strategic marketing objectives. During the digital transformation process,
companies may need to hire outside marketing agencies to acquire the necessary digital marketing tools.
The company going digital should have a committee composed of different personalities passionate about
the project, able to guide the strategic decisions of the employees and help build a digital culture in the
office. A small business should use social networks in its digital marketing strategy, depending on its budget
and overall marketing strategy goals. The company should also use digital tools in marketing based on its
target audience and goals. Employees with an affinity for digital marketing can be identified and trained,
in order to spread best practices throughout the rest of the company. SMEs from different industry sectors
were included in our sample, which allowed us to analyze the challenges of digital marketing from a global
perspective. A larger sample in different regions would help determine the maturity level of companies in
Switzerland. A sector study would provide more information for a more in-depth digital transition for each
sector, which could be used for a comparative study between sectors.

Annexes

Appendix: Questionnaire

Appendix: Tools used by SMEs in marketing activities

Appendix: Classification of digital marketing tools

Bibliography