The way Americans shop has radically changed over the last couple decades. The decline of traditional shopping malls and rise of online shopping followed by the COVID-19 pandemic ushered in an era of uncertainty for many retail small businesses. Yet, recent numbers suggest that American small businesses have finally found their footing when it comes to evolving with the way consumers shop. In fact, mom-and-pop shops across the country experienced a selling frenzy during the last holiday season. Much of that success is due to the full embrace of the digital era of retail.
Despite a challenging few years, American small businesses have learned how to find success online. For many, this means developing more dynamic sales plans that incorporate brick-and-mortar retail and more than one online marketplace. Studies have shown that brick-and-mortar stores and online sales complement each other, with store openings often leading to an uptick in online sales.
Thanks to this revelation, small businesses are not just surviving; they're thriving, securing a well-deserved seat at the online selling table.
What has been particularly heartening is the alignment of interests between small businesses and consumers. Consumers are increasingly inclined towards shopping small, recognizing the unique products, personalized services, and economic vitality it brings to communities. In a refreshing shift, consumers are choosing to prioritize the diverse offerings of small businesses over the convenience of larger, corporate alternatives.
It's a mutual desire for connection. Small businesses want customers, and customers, in turn, are actively seeking out the authenticity that small businesses provide. This shared relationship is not just about a transaction; it's about fostering a sense of community, trust, and shared values.
The joy of breaking out the credit cards on main street instead of the large department store is translating into our online purchasing as well. Certain times of the year, such as holidays, have always been crucial. Small businesses are twice as likely to generate 50 percent or more of their annual revenue during the festive season. It can be a make-or-break period, where the success of holiday sales often determines the financial health of businesses for the entire year.
In the latter half of 2023, small businesses harnessed a surge in online activity to grow in this new retail world. Cyber Monday’s record sales stole the headlines, but the data was more promising than ever for small, independent sellers.
On Shopify, over 17,500 entrepreneurs have made their first sale through the platform. In addition, small businesses that have invested in their own websites are reaching customers more and more.
Small businesses are also leveraging the scale of large online marketplaces like Amazon, Walmart, Ebay, and Etsy as a way to reach a broader set of customers. In turn, marketplaces are stepping up their support for the small businesses selling in their stores. Amazon, for example, has launched a small business filter that allows consumers to shop intentionally small to support local businesses and entrepreneurs.
As we drive towards an increasingly digital future, the success of small businesses online serves as a beacon of hope. Instead of fears about more commerce moving online, we are once again reminded of the adaptable power of our local business owners.
In 2024, I’m optimistic we can continue the economic boon we are witnessing from our country’s incredible entrepreneurs. Consumer preferences for small businesses are well proven – and with this newfound success online, we can finally vote with our wallets and continue to support them year-round.
