Purpose This study aims to analyze the available literature on the use of digital marketing and its impact on small- and medium-sized enterprises (SMEs). This study identifies the use of digital marketing practices and its impact on SMEs. Design/methodology/approach A systematic literature review has been conducted on digital marketing, and its implementation in SMEs. The impact of digital marketing on SMEs performance is observed over the past 12 years through the resources which are undertaken for the study, namely, Science Direct, Scopus, Springer, IEEE Explorer, ACM Digital Library, Engineering Village, ISI Web of Knowledge database is used to search the research publications on the selected topic. Findings Although some SME firms use digital marketing, their impact is not similar where we can recommend a fixed strategy for applying digital marketing. This review provides an insight into how digital marketing has evolved over the period of time and how SMEs are adopting it for their sustenance. Practical implications This study will give theoretical analysis of various benefits received by SMEs because of digital marketing in the different capacities helping organizations to uplift their productivity. Mind mapping will give the idea of impact of SMEs on their various performances in rural as well as in the urban areas. This study will give further scope for digital marketers to approach those industries specifically at rural parts of the nation for bringing change into their marketing operations and also for increasing turnover by the use of digital marketing. Originality/value Research on the use of digital marketing by SMEs firms is still at the embryonic stage in India. This study is a pioneering effort to review the use of digital marketing in SMEs and identify research priorities for scholars and practitioners.