Small business owners have a number of advantages when it comes to engaging their customers. Not only are a majority of consumers more inclined to support local businesses, they’re happy to pay extra for products and services, and quick to promote them if they have a positive experience.
These are some of the topline results from the 2017 RBC Small Business poll conducted by Ipsos Reid. This year’s survey of over 2,000 respondents across Canada provided additional insight into areas such as online presence and payment options—both of which are becoming key competitive differentiators for the small business community.
A love for local business
One of the most compelling results of the survey is that 88% of Canadians will choose to support a local business when possible and 57% said they would pay more for a product or service offered by a local business. The strongest supporters of local business are Millennials, with over two-thirds (69%) saying they would pay more for goods and services offered through local businesses.
Perhaps some of this affinity to small businesses can be attributed to the fact that 63% of Canadians have thought about owning their own business; while one in every three of those have actually started or purchased a business at some point.
For current business owners that have taken the leap, 96% say owning their own business has given them the chance to have control over their career. Even when seeking employment, 63% of Canadians said that they would prefer to work for a small business. It’s clear Canadians have a real “soft spot” for the small business owner.
While that fondness does offer up a considerable marketing advantage for local business owners, the right kind of engagement with your audience is a critical part in getting their attention and building loyalty. The survey indicates for example, that online presence, social media and payment options are extremely important factors in nurturing that engagement with customers.
Getting your name out there
It comes as no surprise that an online presence has become a critical part of the customer experience, whether it’s to place orders, research products and services, engage in conversations or simply find your location. According to the survey, 70% of adult Canadians would be more likely to purchase from a business if it had an online presence.
Millennials in particular are more likely to trust a business (48% of respondents) and perceive the purchase experience as better/convenient (37%) if a business has an online presence. Yet less than half (nearly 46%) of Canadian businesses have a website or e-commerce offering and that number drops to 41% for small- to medium-size businesses according to a 2016 CIRA Internet Factbook.
For a business that does not already have a digital presence or e-commerce offering, this can be a way to diversify revenue streams and grow the business. Not only does it create awareness for the brand, it is an opportunity to engage and build relationships with current customers and attract new ones. Also bear in mind that that CIRA reports that 62% of Canadian Internet users prefer to make purchases from Canadian websites over American ones, which is another major opportunity for business owners selling online.
Get social with your customers
Millennials also take a commanding lead in terms of engaging with businesses in social media with 66% of Millennials saying they actively engage with business owners on social media. Businesses need to pay heed to those numbers given that 75% of Millennials surveyed also say they would support a local business by helping to promote them on social media—a clear advantage when it comes to raising your profile and extending your market reach. In addition, almost 40% of Canadian consumers say that reading product reviews, peer review and feedback on social media has an influence on their shopping behavior, according to a 2016 PwC Canada retail study.
Bring more payment options to the table
A third critical factor in customer engagement is payment options. The survey showed that Canadians want more convenient payment choices. Currently a majority prefer to pay by credit or debit for items over $25. In fact almost 70% of Canadian adults say that they would spend more at a small/local business if it accepted more than just cash as a payment option.
Business owners should also note that 77% of Canadians wish that more of the small businesses they frequent had ‘tap to pay’, and 47% wish they had greater access to mobile payment options such as Apple Pay or Android Pay. Again it is the Millennials that are leading the demand for these emerging payment vehicles: 80% wish more of the businesses they frequent had tap to pay and 60% wish more had mobile payment options. The good news is that payment systems used to be expensive and cumbersome but technology advancements have made it easier for businesses to give convenient payment options to customers, using the infrastructure they already have such as a tablet or smart phone and accept a variety of payments.
In today’s competitive environment, small- to medium-size businesses need to ensure they are keeping pace with customer needs. As our study shows, they already have a significant advantage when it comes to attracting and retaining customers. The key will be to leverage those advantages by continuing to offer the convenience and options their customers are seeking.