Although the number of small businesses across the U.S. has reached a staggering 33.2 million, the sheer scale and competition of large enterprises are still daunting for entrepreneurs looking to gain a competitive edge. Small and Micro-businesses (SMBs) may have fewer resources and a more limited reach than larger companies, but that doesn’t mean they can’t be successful. With careful planning and a clear understanding of their target market, SMBs can compete effectively in their industry. Additionally, advancements in technology and the rise of digital marketing have leveled the playing field for SMBs, allowing them to reach a wider audience and reduce the costs associated with traditional marketing methods.
Here are a few key considerations small and growing businesses need to keep in mind in 2023 and beyond.
1. Solve pain points with a targeted digital approach
Over the last few years, innovation and digital transformation happened—fast. The pandemic led to a shift towards flexible work, which has resulted in many businesses having excessive technology tools in their tech stacks. In 2023, it will be especially critical for SMBs to be intentional in laying out their digital transformation strategies. There’s no one-size-fits-all approach to digital presence. But luckily, there are a few steps all SMBs can take to find what works for them.
First, business leaders must decide what they’re looking to gain from digital transformation. Increased sales, improvement in customer retention, or a better user experience are all logical answers. Identifying potential roadblocks, from untapped opportunities to customer pain points, is vital. This background knowledge should inform the larger strategy, illuminating what types of technology will help transform goals into achievements.
This year, we’ll see SMBs exploring new and exciting innovations, from AI and VR to cloud computing and ultra-fast networks. While these tools have thrilling potential, it’s important to remember that tech strategies are fluid. For instance, if a business’s customers are struggling with user experience, VR/AR and AI tools may help them interact with products in a new way, while other businesses might find them less useful.
The eCommerce boom has also underscored the importance of a strong digital strategy. Fast page speeds, user-friendliness, engaging content and reliable checkouts have become non-negotiables, and SMBs need to be more attuned than ever to trends in web design, SEO and eCommerce, all while thinking proactively about how emerging tech can elevate the shopping experience without being shoehorned in.
2. Maximize your performance while balancing consumer preferences to streamline selling
Convenience is a major driver of the eCommerce growth we’ve seen in recent years, with fast shipping and ease of experience leading consumers to flock to online channels in droves. That doesn’t mean they’ve forgotten about the beloved mom-and-pop shop on the corner, though. Research from Intuit shows that 70% of consumers prefer to shop locally, and it’s important for SMBS to capitalize on opportunities to personalize marketing and foster a sense of community. That local approach should work hand-in-hand with a strong eCommerce experience. With endless options across online marketplaces, consumers will grow impatient with underwhelming eCommerce performance, whether at checkout or along the shipping journey. Luckily, the eCommerce boom has meant proportional growth in the selling and logistics offerings across web providers, significantly lowering the barriers to entry around creating an online store.
Incorporating a variety of payment options can be another way to appeal to the widest possible audience. Buy now, pay later tools have seen steady adoption, with users growing 85% in 15 months between 2020 to 2021 and even more so in 2022 as holiday shoppers grappled with inflation. With some consumers preferring to break up their payments into installments or use services like PayPal instead of credit cards, a wide swath of payment options can present an opportunity to draw in more shoppers.
Social media presence and influencer programs can also be useful in reaching new audiences and attracting new customers. As companies like TikTok continue to build their eCommerce presence, SMBs would be wise to monitor future developments in the social selling space.
3. Show the customer you care
SMBs have unique advantages over their enterprise counterparts when it relates to sincerity, quality and customer engagement, and it’s important to leverage those strengths across the selling journey. Integrating social initiatives into your business can drive sales by demonstrating alignment with customer values. Sustainability, for example, is a relevant example for environmentally conscious SMBs whose customers likely share their passions.
It’s also fair to say that community-conscious small businesses will stand to see greater financial success in 2023. Recent research showed that 66% of adults in the U.S. will spend more to shop ethically, so SMBs who take steps to reduce their carbon footprints may improve customer relationships as a result. Creating a dedicated webpage that’s transparent about participation in community initiatives will clearly communicate your business’s mission to its customers, hopefully winning support along the way.
Consumers want to see value alignment in their products, but they also want individuality and quality. Attention to detail communicates care, and a smaller operation can provide quality control and originality that is hard to deliver on a larger scale. Taking additional steps like providing unobscured product details can also help SMBs create brand loyalty.
Put words into action
The past year’s challenges have highlighted the fact that small businesses that can adapt and remain resilient in a highly competitive digital marketplace are often rewarded for their efforts. By closely evaluating new technologies, keeping customer needs and values at the forefront, and updating their practices to suit the modern day, SMBs can effectively leverage their online presence to thrive in 2023 and beyond.
Jason Cross is the SVP of Digital Presence and Commerce at Newfold Digital.