There are many uncertainties small businesses are facing heading into this year’s holiday season. But one thing is very certain; consumers want to shop locally and with small businesses. That’s according to the results of a recently released report from Intuit’s QuickBooks Commerce small business shopping report.
To learn more about the insights coming from the report, and how they may impact the holiday shopping season, I recently had a LinkedIn Live conversation with Shilpa Reddy, VP and GM of Quickbooks Commerce at Intuit. Below is an edited transcript from a portion of our conversation. Click on the embedded SoundCloud player to hear the full conversation.
Big picture learnings from the survey
Shilpa Reddy: The first thing we learned is the appetite and even more willingness of consumers to shop small this holiday season. We have seen 93% of consumers reporting that shopping mall with the local businesses, they are really wanting to support small businesses. Now, that opens a big opportunity for small businesses.
We also learned from our consumer research that 48% have expressed willingness to try small businesses in the upcoming holiday season. Now, as we think about the importance of it, this is a huge opportunity as well. Then when we talk about, what are some of the fundamental shifts in the consumer shopping behavior, as they enter into the holiday season, the big shift really is about online. Our consumers have indicated based on their experiences during pandemic, a lot of openness to try online. 83% customers have indicated that they want to shop online this holiday season.
Quality of your website is key to selling online
Now, when we talk about selling online, the first and foremost thing that comes to the mind is, the quality of the website and customers expect the quality to be really stable, that the websites be stable, high quality, to be able to discover the products that they want to discover and be able to purchase effortlessly, smooth and reliably.
83% of the customers have expressed that when they tried to shop online, they have experienced at least one or two technical glitches in shopping. Now that is a serious problem because almost 58% of the consumers have also said when they encountered such issues, they actually bailed on shopping. So, the purchase didn’t happen. So, it’s a loss of sale for business. Then that is a pretty big deal.
Brent Leary: One of the positives I think that was really illustrated in the study is that it feels like consumers are more into choosing smaller businesses this year. It feels like there’s more of a connection this year between consumers and smaller businesses and smaller brands. Was that a surprise? That was an interesting development. I thought it as a great development, but it was really interesting.
Shilpa Reddy: It is actually a very interesting development, right? As I mentioned, our survey informed that 93% of consumers want to support small businesses, especially during this pandemic, because they think this is most important than ever. Because we have seen closely how small businesses have not only run, but have been really competing and trying to thrive in the environment that is just so challenging over this past year and a half, if you will. So more and more as you see small businesses around us, we all have familiarity with small businesses, right? We know a small business. We are either of small business owner ourselves, or we have somebody in our friends and family who is a small business. We have seen foundationally how small businesses are core to our economy. From a global landscape perspective, there are over 800 million small medium businesses and self-employed in the world.
These small businesses actually create 80% of the total economy, 60% of the total jobs. And so, the more you see the impact that… and they compose 90% of the total businesses altogether. We have seen how challenging it has been through the pandemic for the small business owners… There is a demand challenge. Now there’s a supply challenge. So, there has been a lot of challenges that they’ve been experiencing. However, they’ve been really fighting it. They’ve been there. They’ve been trying to support their own community despite the odds. So, there’s more and more interest for the consumers to want to be there and to really help small businesses, especially during these uncertain times.
Brent Leary: So, when you think about any additional challenges, for example, like you mentioned, social media advertising, there’s a lot of upheaval going on with that. How is that impacting the ability of small businesses to sell online and sell it efficiently online? Are we seeing any impact on what’s going on with some of the things that Apple’s doing and these privacy changes? Are we seeing that impact the way small businesses are able to use social media and use advertising?
Shilpa Reddy: I think there is a lot of innovation across these different platforms because consumers’ shopping trends have also been evolving with all the social transformation, if you will. So, it is critical for small businesses to be where their customers are, which are the consumers and where the consumers are. They are on these massive marketplaces, they’re on these social channels. So, being where your consumers are is very important.
The second aspect to is being discovered in those social channels. As you mentioned, there are billions of views that each of these platforms would have. How do you, as a small business owner, be able to do the things that are needed for you to actually be discovered in those, is a big challenge as well.
Ads is a very interesting opportunity as well. But again, you also need to understand the cost, the muscle that you need. I think that many of the platforms are really leaning in and investing in making these tools for the small businesses helpful. And so, that actually helps both in terms of being there where these consumers are and being also discovered by the consumers across these platforms. Even in the commerce segment that we are focusing on at Intuit, when we look at the pain points of small medium businesses in this landscape where there are multiple sales channels, multiple social platforms, multiple commerce platforms, how do we equip them? How do we help these small businesses to thrive in that fast moving and innovative environment? It’s really about being present across different channels. Omnichannel shopping is the way to go.
We are also seeing that 58% of our consumers have informed that they’ve looked to shop both online as well as physical stores in this coming holiday season. In fact, our report also stated that up to nearly 50% of the customers have stopped shopping at the store that did not have online presence in the pandemic. So, it’s a very interesting shift of the shopping behaviors that we are seeing. The massive trend that is evolving is, online is critical, multiple social channels is critical, which means having an omnichannel presence for small businesses is very important.
To your point around, how do you think about all the evolution that is happening in helping customers, we are basically within the commerce segment. We are looking through our product. We’re trying to help small businesses to use a single platform through which they’re able to list products in one place and be able to syndicate the listings across different channels. We integrate with several major players like Amazon, Shopify and WooCommerce, if you will. We actually also aggregate all the orders and more importantly, inventory, I think just even tying back to that. At the moment, you have a holistic view of your orders across different channels. You then have a way for you to know that your inventory is absolutely accurate and up to date in terms of where the sales are happening.
You then will have more predictability to be able to sell what you needed to sell, not under sell or over promise to our customers and be on top of those. So, I think that there are tools, but there are also openness, if you will, that, “Hey, I need to be present across different channels.” And then, taking advantage of the different tools that are out there, both from an advertising standpoint, as well as from overall shopping experience standpoint, whether it’s a great website or otherwise.
TikTok and traditional small businesses
Brent Leary: Are you seeing small businesses able take advantage of platforms like that to connect with their audiences?
Shilpa Reddy: The consumer shopping trends have been shifting from a physical store to marketplaces and to social platforms and now video live streaming and live platforms, live shopping as well, through platforms like TikTok. As part of the overall strategy for small businesses, when they think about it, depending on the products and the type of consumers that they think their products should attract, they have to have an overall strategy about what channels are important, especially with the demographic customers that we are seeing in the TikTok. So, it’s actually picking up the attention as well from our shopping perspective, as you said, they’re also evolving platforms to help small businesses to be able to demonstrate their products, showcase their products on TikTok. Have even live shows, use an influencer to broadcast their events.
There’s a lot of goodness that the platforms are providing. To your question on, do we feel the small businesses are ready? Yes and no. Those who are really savvy and are open and are exploring and are leveraging. Those I think hare doing. But I think for the broader part, they definitely need a journey, a bit of support from the different platforms that are out there, to help them ease through that journey. It’s a change that I think the change part, we need to be part of the journey with the small businesses and help them along the way.
BOPIS – A small business differentiator
Brent Leary: Buy online, pick up in store (BOPIS), from a small business perspective. Do you think that’s going to be one of the ways that small businesses could maybe separate themselves and get even more of that local traffic?
Shilpa Reddy: Yeah, I think it’s a great question. I’ll say that for two reasons, right? Even when we say, why are consumers shifting towards online, you’re seeing three different factors. One is the convenience, right? So, you can be at your doors at your home, in front of your phone and purchase anything that you want without really much effort. So, that convenience is a huge, and especially everybody has seen that in action over the last year and have during pandemic. And so, that is driving a lot of shift towards online. The second one is about variety in selection. If you go to a single store, you get to expose what you have over there. Now you go to multiple online, you’ve got a lot of access to selection. You can research the products just online. You can discover the right products. So, that selection discoverability is the second factor that’s driving.
Third one is about price affordability because of the online access selection, there is a price affordability that’s a big attraction also for small business owners. Now from a consumer standpoint, as they look at these dimensions of why they’re choosing to convenience to your point is the most important thing for small business owners. Not everybody may have a physical store where they have the inventory stored at a place that is convenient for a consumer to go pick up on their way to… Like a mom who’s dropping her kid for a soccer would want to pick up on the way, you need to have access points to provide that convenience.
Consumers are more and more shifting towards, because they’re basically saying we want to buy in store. We want to buy online. We need to have omnipresence. So, that choice to pick up from anywhere, buy online, pick up from store, get the delivered is just so important in the shopping trends as well. So, taking advantage of the networks that are out there, the fulfillment and shipping networks out there is very important for small businesses and taking advantage of what access locations can I store my inventory, or can I actually make for pick up available or like cop site pickups available or what have you. It is a very interesting paradigm shift as well, we are seeing
Brent Leary: What are the things that you want them to take away from your survey findings. And, and if at all possible implement for this selling season.
Shilpa Reddy: First of all, as I informed, the survey clearly says, consumers are with you. They want to shop with you. It’s an overwhelming 93% of consumers want to be with you and support you during these uncertain times. 50% of consumers decided that they want to shop small this holiday season. So, that’s a huge good news, a bunch of opportunity for small business owners. We need to take advantage of that. How do you take advantage of it is, online channels. Having a clear strategy is very important. Find the channels that are most relevant, both online and physical where applicable, but be clear on what channels makes sense for you. Make sure that you have a very highly functional website. Take advantage of all the platforms that are out there that are helping provide that fantastic website experience, seamless high quality reliability, so that you are not missing on a consumer shopping purchase because of technical glitches.
Shipping is another one. 30% nearly, customers have informed that shipping is a big critical need for them, especially during holiday season. So, finding the right shipping providers who can, or through your platforms that you’re selling, who can meet the promise of your consumers is very important. So, extreme focus on shipping and making sure the quality of shipping is at what you expect and what your consumers expect, is very important as well.
And finally, I will say having a great end-to-end point of view in terms of what tools might help me be discovered, right? So, you might have a great tool. People have openness, that’s fantastic. There are a lot of tools to help you be omnichannel and present, but taking advantage of different platforms through which you can get discovered during this holiday season as a local business by your consumers, whether it’s through advertising or what, so it’s very important. I will also add that in that effort, QuickBooks recently also, we are also launching this holiday shopping guide as part of the holiday shopping guide. We are promoting small, medium businesses. And as a consumer, you should be able to find small, medium businesses through the shopping guide and be able to support your local business this holiday season.
This is part of the One-on-One Interview series with thought leaders. The transcript has been edited for publication. If it’s an audio or video interview, click on the embedded player above, or subscribe via iTunes or via Stitcher.
Source : SmallBizTrends