• by Ray Schultz , Columnist, July 21, 2023

Small U.S. businesses are slowing down in their attempts to digitize, judging by a recent study by Ionos.

For instance, only 44% are now using a company-specific website, down from 65% in 2022. Moreover, use of company-specific email domains has also fallen to 44%, versus 60% last year.

At the same time, 24% plan to invest less heavily in digitalization due to the current economic situation. 

American small and medium-sized businesses (SMBs) lag behind their European counterparts because of these hurdles:

- Costs — 60%

- Lack of time — 56%

- Lack of know-how — 52%

- Lack of interest in digitalization — 51%

- Inflation — 50%

In general, the biggest risk factors facing SMBs in the U.S. are:

- Declining economy/threat of recession — 46%

- Shortage of skilled workers — 44%

Firms in European countries place a greater priority on digital, including Spain (88%),  Germany (81%), France (80%) and the U.K, (79%), versus 75% in the U.S.

On the positive side in the U.S., 67% report they are well-situated regarding IT security and cybercrime, compared to roughly 50% in Europe and 33% in France in particular. 

American SMBs implement such protections as regular password updates and high password security (36%) and choosing cloud and hosting solution providers experienced in cybersecurity and maintaining critical infrastructure (33%).

“Those who don’t firmly anchor their business strategy in digitalization will have a hard time surviving in the market,” says Achim Weiss, CEO of Ionos. "Of course, expertise must first be developed, and resources invested, which isn’t always easy for SMBs. However, the gains they realize from digitalization, including improved visibility, growth, new business models and greater resilience to crises, far outweigh the initial outlay.”

On behalf of Ionos, YouGov surveyed 4,800 respondents, including USA 1,000), the U.K. (1,004), Germany (1,005), Spain (1,004) and France (801) earlier this year.