Description

Providing the most comprehensive and up-to-date information and analysis of the US Shopping Small Businesses market including the behaviors, preferences, and habits of the consumer.

In the coming 12 months, 52% of consumers expect to include small businesses in around half or more of their shopping trips. This significant number indicates the importance of small businesses to consumers and highlights the need to understand consumer behavior as they shop from these stores. Small businesses are vital to communities, and consumers are shopping more mindfully as the pandemic brought about change to their shopping behaviors. COVID-19 has affected and will continue to affect small businesses as states continue to adjust restrictions and safety measures based on the state of the pandemic. As consumers are looking to take a more conscious approach to their shopping, they will continue to look to support small businesses during, and beyond, the pandemic.

That said, they are still not willing to give up the convenience of shopping with larger, traditional retailers. This creates opportunities for mainstream brands to support small businesses, as well as highlighting the importance of investing in digital efforts to better reach consumers.

Awareness is one of the biggest barriers to shopping small businesses. Whether consumers are local or not, it can be difficult to discover small businesses to shop from, especially if they don’t know where to look specifically. This means that search engine optimization, geo-targeting and spreading awareness on social media will be key avenues for small businesses to explore to reach customers.

Shopping small businesses leaves a positive impact on the communities they serve as well as the environment as a whole. When consumers shop small, more dollars are put back into the community than if they were to shop at national/larger chains. Further, shopping small often means cutting down on emissions and carbon footprint since items often do not have to travel as far to reach their final destination. Small businesses can position themselves as ethical, eco-friendly options for consumers to shop and feel good about their purchases.

Read on to discover more about the US Shopping Small Businesses market, read our Millennials: Online Shopping Behaviors – US – 2021 report, or take a look at our other Ecommerce and Online Shopping market research reports.

Quickly understand

  • The impact of COVID-19 on consumer behavior and small businesses.
  • How consumers currently shop small businesses and their future plans to do so.
  • Occasions driving purchases at small businesses.
  • Motivators and barriers to shopping small.

Covered in this report

Brands include: Shopify, Squarespace, American Express, Coco & Blu, Verde Market, eBay, Amazon, Etsy, Target, Walmart, Foursided, shopChooka, Diamond Group, Instagram, YouTube, TikTok.

Expert analysis from a specialist in the field

This report, written by Katie Hansen, a leading analyst in the Retail & eCommerce sector, delivers in-depth commentary and analysis to highlight current trends and add expert context to the numbers.

Small businesses play a significant role in consumers’ shopping behaviors and local economy. The pandemic caused consumers to think more mindfully about where they shop and highlighted small businesses as an area to focus on. Moving forward, there are various opportunities for these businesses to expand reach and consideration across consumer groups. There is a desire to see small businesses shine now and in the future, which means that business platforms and companies of all sizes should be taking note of opportunities to work with these small shops.
Katie Hansen, Retail & eCommerce Analyst
Katie Hansen
Retail & eCommerce Analyst

Table of Contents

  1. Overview

    • What you need to know
      • This Report looks at the following areas
        • Definition
          • Economic and other assumptions
            • COVID-19: US context
            • Executive Summary

                • Top takeaways
                  • Market overview
                    • Impact of COVID-19 on retail and small businesses
                        • Figure 1: Short-, medium- and long-term impact of COVID-19 on retail and small businesses, 2021
                      • Opportunities and challenges
                        • Demonstrate environmental responsibility
                          • Use store space for more than one function
                            • Leverage social, search and synergies to drive awareness
                            • The Market – Key Takeaways

                              • Small businesses look big within the US economy
                                • COVID-19 caused chaos and concentration on small businesses
                                  • Economic volatility rocks small businesses
                                    • Investing in tech helps extend the reach of small businesses
                                    • Market Landscape

                                      • Small businesses comprise a large part of the US economy
                                        • Impact of COVID-19 on small businesses
                                        • Market Factors

                                          • Higher taxes breed concern
                                            • Labor shortage and skyrocketing prices create challenges for small businesses
                                              • Consumers turn their focus on community
                                                • Small businesses need to invest in tech
                                                  • The debate over the minimum wage is a double-edged sword
                                                  • Companies and Brands – Key Takeaways

                                                    • Using store locations for more than one purpose
                                                      • Partnering up big business and small business
                                                        • Casting wider nets with social
                                                          • Focusing in on the environment
                                                          • Competitive Strategies

                                                            • American Express promotes small businesses
                                                              • Figure 2: American Express highlights importance of shopping small, 2021
                                                            • CoCo & Blu: Multi-faceted, multi-functional
                                                              • Figure 3: CoCo & Blu Cafe leverages storefront for multiple purposes, 2021
                                                            • Focusing on sustainability, waste reduction
                                                              • Figure 4: Verde Market gives consumers options to shop with less waste, 2021
                                                            • Online marketplaces give reach to the smallest of businesses
                                                              • National retailers look for ways to partner small
                                                                • Figure 5: Amazon highlights small businesses on Instagram
                                                            • Market Opportunities

                                                              • Leverage social media as a new(er) sales outlet
                                                                • Partner with other (national) retailers to expand reach
                                                                  • Figure 6: Target promotes Black-owned businesses
                                                                • Support local initiatives and charitable efforts
                                                                  • Lean into community growth, environmentalism
                                                                  • The Consumer – Key Takeaways

                                                                    • Small businesses are an important part of consumers’ shopping system
                                                                      • Consumers shop in store and online with small shops
                                                                        • Supporting communities drives consumers to shop small
                                                                          • Opportunity to capture sales around special occasions
                                                                            • Price gets in consumers’ way when shopping small
                                                                            • Current and Future Small Business Shopping Plans

                                                                              • Small businesses make up a fair share of consumers’ shopping pie
                                                                                • Figure 7: Where shopped lasted 12 months, 2021
                                                                              • Younger consumers seek small businesses
                                                                                • Figure 8: Where shopped lasted 12 months, by generation, 2021
                                                                              • The future looks bright as consumers plan to shop locally
                                                                                • Figure 9: Future small business plans, 2021
                                                                              • Younger shoppers to drive future purchases
                                                                                • Figure 10: Future small business shopping plans, by age and gender, 2021
                                                                                • Figure 11: Etsy customers feel good shopping small, 2021
                                                                              • Provide parents ways to show off, engage with one another
                                                                                • Figure 12: Future small business plans, by parental status, 2021
                                                                            • How Consumers Shop Small Businesses

                                                                              • Streamlined shopping experiences still matter when shopping small
                                                                                  • Figure 13: Typical shopping behavior, 2021
                                                                                • Driving future purchases with online capabilities
                                                                                    • Figure 14: Future shopping behaviors, 2021
                                                                                  • Bringing the small business world to parents via online channels
                                                                                      • Figure 15: Future shopping behaviors, by parental status, 2021
                                                                                  • Motivations & Influences for Shopping Small Businesses

                                                                                    • Small businesses poised to win the hearts of locals
                                                                                      • Figure 16: Lakeview East members rally together to support local establishments, 2021
                                                                                      • Figure 17: Reasons for shopping small businesses, 2021
                                                                                    • Across income levels, consumers want to support their communities
                                                                                        • Figure 18: Reasons for shopping small businesses, by HHI, 2021
                                                                                      • Relying on communities for information
                                                                                          • Figure 19: Sources of information, 2021
                                                                                        • Younger consumers seek info digitally; older generations, traditionally
                                                                                          • Figure 20: Sources of information, 2021
                                                                                      • Occasions for Shopping Small Businesses

                                                                                        • Offering assistance throughout special occasions
                                                                                          • Figure 21: Occasions for shopping small businesses, 2021
                                                                                        • Partnering to give personalized recommendations
                                                                                          • Figure 22: Occasions for shopping small businesses, by age and gender, 2021
                                                                                        • Reminding parents to take time for themselves
                                                                                          • Figure 23: Occasions for shopping small businesses, by parental status, 2021
                                                                                      • Barriers to Shopping Small Businesses

                                                                                        • Overcoming price with quality, community and cost-assistance
                                                                                            • Figure 24: Foursided promotes surprise discount, 2021
                                                                                            • Figure 25: ShopChooka offers AfterPay exclusive discounts, 2021
                                                                                            • Figure 26: Barriers to shopping small businesses, 2021
                                                                                          • Alerting younger consumers to small businesses’ presences
                                                                                            • Figure 27: Barriers to shopping small businesses, by gender and age, 2021
                                                                                            • Figure 28: Etsy Instagram highlights freebies with purchases, 2021
                                                                                        • Attitudes toward Shopping Small Businesses

                                                                                          • Reminding consumers of the good of shopping small
                                                                                            • Figure 29: Diamond Group Realty supports small on Small Business Saturday
                                                                                            • Figure 30: Attitudes toward shopping small businesses – Ethical impact, 2021
                                                                                          • Leveraging social to connect with Gen Z
                                                                                            • Figure 31: Attitudes toward shopping small businesses – Ethical impact, by generation, 2021
                                                                                          • Traditional retailers can partner small to show local support
                                                                                            • Figure 32: Attitudes toward shopping small businesses – Traditional retailers, 2021
                                                                                          • Giving younger consumers ethical, convenient ways to shop
                                                                                            • Figure 33: Attitudes toward shopping small businesses – Traditional retailers, by age and gender, 2021
                                                                                          • Developing ecommerce avenues to drive small business awareness
                                                                                              • Figure 34: Attitudes – Small business experience, 2021
                                                                                              • Figure 35: Instagram Shop
                                                                                            • Connecting digitally with younger shoppers
                                                                                              • Figure 36: Attitudes – Small business experience, by generation, 2021
                                                                                          • Appendix – Data Sources and Abbreviations

                                                                                            • Data sources
                                                                                              • Consumer survey data
                                                                                                • Consumer qualitative research
                                                                                                  • Abbreviations and terms
                                                                                                    • Abbreviations
                                                                                                      • Terms
                                                                                                      • Appendix – The Consumer

                                                                                                          • Figure 37: Occasions for shopping small businesses, by age and gender, 2021

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