Digital Transformation Impact on Financial Performance Through Social Media Marketing in India’s SMEs

The Small and Medium Enterprise (SME) sector is critical to the Indian economy since it creates jobs and raises living standards. SMEs, on the other hand, encounter difficulties in embracing digital transformation. This research investigates the role of effective digital marketing in promoting SME development and sustainability under volatile market conditions. The study focuses on social media marketing and its effect on the financial performance of SMEs. According to the study, technological, organizational, environmental, and individual preference factors all have a major impact on social media marketing adoption. According to the survey, SMEs can efficiently use digital platforms to build up their enterprises, expand their market reach, and handle client difficulties. The data was gathered by the researcher using a standardized census survey questionnaire. Structured questionnaires are being delivered to 392 SMEs in Bengaluru City, with a focus on the service sector, and analyzed between August and November 2023. Out of the total distributed 392 questionnaires about 8 of them have not returned with full data while the remaining 384 responses are used for data analysis. The Data is analyzed using the Statistical Package for Social Sciences (SPSS) and AMOS. The study employed the descriptive and explanatory research design. The result indicated that the Technological Factors (p-value = 0.000), Organizational Factors (p-value = 0.042), Environmental Factors (p-value = 0.021), and Individual Preference (p-value = 0.023) have a significant positive influence on Social Media Marketing Adoption, and Impact of Social Media Marketing Adoption (p-value = 0.035) on Financial Inclusion of SME Businesses is also found to be significant. The SMEs could use this opportunity to elevate their business in the digital platform.