One major challenge faced by local businesses is in figuring out how to compete with both national chains that have more resources, and new app-based on-demand services that tout superior convenience.
But a new survey from local online marketing company Yodle finds that customers gravitate toward local businesses for better-quality service and are increasingly open to interactivity with them, a combination that provides opportunities for growth — if only those businesses will take the leap and embrace the technology necessary to facilitate that communication.
According to the survey, 82% of consumers patronize local businesses and 48% plan on increasing their local shopping in the next year. Ninety-six percent of consumers said local businesses have a leg up over national chains in terms of quality and service, and 72% are willing to pay more for that difference. On a list of ten reasons why a consumer would choose a local business, quality of service was number one and competitive pricing was number seven.
Another significant finding was the importance of offering consumers the ability to read and provide online reviews; 89% said they would provide a review if they were asked and had a positive experience with the business.
“It’s surprising that small business customers are more than willing to do online reviews, that they understand the value of them, but are not being asked,” said Paul Bascobert, Yodle’s president of local. Beyond that, consumers are open to a number of forms of communication, Bascobert said, especially “more offers that recognize their loyalty.” The survey revealed that a majority of consumers are open to receiving service and appointment reminders, advice and tips, business and service updates, feedback requests, personalized communication, event invitations, and newsletters.
Of equal urgency is the general need for SMBs to improve upon their online and mobile presence, which can help keep them from falling victim to the Uber-like apps that are popping up in — and dominating — many markets. According to the survey, more than any other change in the way local companies do business, customers want to see better websites — and more than a quarter of customers want SMBs “to provide the option of booking appointments and managing billing and payments online.” And 83% of those surveyed said they would prefer communication via email, text, and/or social media, compared to 14% via phone and 3% via U.S. mail.
It’s undeniable that the rapid rise and continued success of on-demand startups is influencing what consumers now expect from all businesses. Yodle’s findings reinforce the fact that for a small business to compete with a tech company that’s threatening the market, it must adapt certain elements of the technology that makes that other company so appealing.
“It’s pretty darn hard to call a cab, and Uber solves a customer problem,” Bascobert said. “If you’re a small businesses, this [model] isn’t good for you. These companies start dictating pricing and service and response. Our view is that small business owners need to get in front of this trend and enable technology that helps them build great relationships.”
The uniting theme of the survey is that consumers have come to expect communication from local businesses, and even now seek it out. When the lines of communication are opened and a back-and-forth relationship is developed between business and consumer, a local company can better respond to the needs and desires of its market and grow consistently.
“The world has become much more social in the past five years,” Bascobert said. “Customers are more comfortable reviewing and offering their opinions.” Now the emphasis is on adapting the technology that gives them a voice.
Annie Melton is Street Fight’s news editor.
Want more of the latest data about how small businesses are thinking about marketing? Check out Street Fight’s 2015 Local Merchant Report.