THE BLOG
06/14/2013 11:18 am ET Updated Aug 14, 2013

Small Merchants: Getting Noticed Among "Big Box Noise"

Let's face it: The "big box" brands have the marketing muscle to both create and dominate most of the noise in the consumer marketplace - be it stores, restaurants or services. Smaller or emerging merchants might be intimidated by today's business landscape, especially when considering they don't have the resources to outspend larger, more established brands in marketing, or provide rock bottom prices. So how are small merchants expected to draw customers to their local, independent locations? Access to digital tools, community ties and the ability to be nimble and flexible are just a few advantages that small merchants have to attract more customers to their business.

A Brave New Small Merchant World

The idea of what it means to be a small merchant today has changed. Large capital investments, a physical location full of tangible products and even a cash register are no longer required to start and grow a business. Digital tools have virtually eliminated the barrier to entry for aspiring entrepreneurs, allowing them to create storefronts of all kinds at a significantly lower cost. We now have e-stores, micro-businesses, mobile payments and small merchants that combine both the virtual and physical worlds.

Technology has also completely redefined the connection between buyers and sellers. Today's consumers are digitally savvy and able to make smarter purchasing decisions thanks to the devices at their fingertips. They now have easier access to interactive maps, price comparison tools, store history and peer product reviews in an instant. These consumers are more informed now than ever before and they know there are options outside of big box chains to find what they are looking for. They are also more willing to share their favorite neighborhood finds with their social networks, increasing word of mouth marketing potential. Social media has allowed small merchants to amplify their message beyond the traditional marketing offer. Think about the last time you shopped or dined at a small merchant without checking reviews, Facebook "Likes," Foursquare "check-ins" or tips first.

Community Roots and Local Taste vs. Marketing Power and Price

Big box brands rely on national marketing and advertising campaigns to attract consumers and are also often able to boast competitive prices, due to their broad scale distribution power. Where these brands can lack at times is in the flexibility to quickly adapt. For example, Snack Taverna, a Greek restaurant in the West Village of NYC, was able to keep its doors open following Hurricane Sandy by quickly converting to a candle lit wine bar until power was restored to lower Manhattan. Consumers can have a hard time feeling connected to mass-market brands with a blanket message. This is where small merchants have the advantage and can often develop a more loyal customer base.

Small merchants are often members of the communities themselves and might visit the same coffee shop, gym or dog park as their customers. There is a genuine connection to the community that allows small merchants to develop stronger relationships with customers and consequently, a much more loyal customer base. Community-based small merchants are crucial to the development and growth of our economy and have been an American tradition for centuries. Consumers like to support their local communities and the continued success of small business initiatives like Shop Small and Small Business Saturday are further proof.

Small merchants also know the neighborhood and are in the best position to determine the type of products, services, promotions, events and store hours that will be successful. They are often perceived as experts in their given field and consultants for their products. La Cocinita, for example, is a food truck in New Orleans that got started when Chef Benoit Angulo, originally from Venezuela, grew tired of the lack of good late night food options in the area. La Cocinita has rooted themselves in the community and not only become the go-to for authentic Latin American street food in town, but the truck's owner, Rachel Billow, also serves as the president of the New Orleans Food Truck Coalition and represents other local trucks in the fight to evoke changes in city regulations. Feet First, New Orleans' largest independent retailer of women's designer shoes and accessories, is able to curate its inventory differently at each brick-and-mortar location, while showcasing all of its goods online. By stocking product offerings from local designers, Feet First shows their support of other small merchants in the community while simultaneously catering to the comfort shoe-seeking tourist customer base at its French Quarter location and the fashion-savvy local clientele at its Magazine Street store.

One of the best examples of just how deep community connections run is Tailwaggers, a pet care store in Hollywood, California. Owner Todd Warner explained that when neighborhood dogs periodically escape from their back yards, they have been known to turn up at the store's stoop, making Tailwaggers one of the first check points for pet owners.

Social Media, Mobile Payments Help Level the Playing Field

The beauty of the mobile and digital age is that it opens the playing field for entrepreneurs of all types including pop-up shops and restaurants, tent stores at events and food trucks. Mobile payments mean merchants can sell their wares "anywhere" and also accept credit cards, which consumers are quite apt to use these days.

Another way small merchants can compete with big name brands using today's digital tools is to harness social media. The "network effect," which allows someone to share their positive experiences with their social network, which can in turn be shared with a broader network, provides a real opportunity for a small merchant to grow their customer base very quickly, with little to no capital investment. The power of social media can allow small merchants to more effectively compete with larger businesses by promoting timely offers, engaging with customers on a personal level and giving the public a peek inside what makes their business unique.

A great example is the Big Gay Ice Cream truck, an iconic food truck in New York City that is home to wacky named ice cream cones that feature unusual ingredients like cayenne pepper, ginger curry, pumpkin butter and wasabi pea dust. What started as a "summer experiment" with a rented ice cream truck in 2009, quickly gained popularity thanks to social media. The truck expanded to a physical location in the East Village in 2011 and a second location in the West Village in 2012, with the truck still operating strong every summer. With nearly 48,000 Twitter followers, more than 20,000 likes on Facebook and no phone number listed, Big Gay Ice Cream shows us the possibilities that the digital world can bring into the physical one.

Tips for Success

  • Take advantage of free or low cost digital tools to grow your business. Determine the platforms that are right for your particular industry and customer demographic and devote the time and resources necessary to grow your presence.
  • Stay flexible. The ability to act quickly and adapt to community or national events and trends is one of your greatest advantages over the national brands.
  • Keep your pulse on local preferences. As a member of the community in which your small business is located, you are in an ideal position to accommodate neighborhood preferences and leanings in a way that a national brand can't compete with.
  • Don't be afraid to go to your customers, rather than waiting for them to come to you. Today's consumers expect brands to cater to their preferences and digital tools have allowed small merchants the mobile capabilities to take their business on the road, whether that be to a fair or festival, someone's home or to a virtual location online.

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