It’s ‘inherently harder’ to compete in digital-first market, Amex exec says

Marianne Rausch, American Express Vice President of Small Business Saturday and Shop Small, joins Yahoo Finance to discuss the impact of November 26’s Small Business Saturday, how business owners are being taught to integrate into digital marketplaces like TikTok, and buying from small businesses this holiday season.

Video Transcript

Small Business Saturday is November 26. And American Express is partnering with TikTok to launch what we’re calling the– as we take a look here, we’re taking a look at the #ShopSmallAccelerator. The initiative is meant to help small businesses become effective TikTok marketers as well. Now we’re joined by Marianne Rausch, American Express vice president of Small Business Saturday and Shop Small. Thank you for joining us. So for people who are trying to get their head around this context wise, talk about the economic impact of small businesses.

MARIANNE RAUSCH: Absolutely. So thank you so much for having me. American Express founded Small Business Saturday back in 2010 because we recognize the critical importance of small businesses to our communities. They are really the lifeblood of our neighborhood. They boost the local economy. And they enrich our neighborhoods.

So to continue that rich tradition of small business support and to really bring it into the things that are most relevant and important for small business owners in 2022, we are partnering with TikTok to launch a shop small accelerator, which is really going to help small business owners with best practices, tools, and resources to create the types of marketing and content that are really going to help them break through and stand out on the platform.

Marianne, you’re talking about small businesses all the time. Just what are you hearing from them just about the importance of a presence on social media and how you hope that carries through Small Business Saturday and beyond over the next couple of years?

MARIANNE RAUSCH: Absolutely. So there were two clear themes that we were hearing about from small businesses as we began to plan for this Small Business Saturday. First, it was the interest in really understanding– or just the criticality of reaching a younger audience, particularly that Gen-Z and millennial audience of customers. And then secondly, the just importance of social media in general for getting in front of that audience.

So 88% of small business owners said that in the past year social media has helped them find new customers. And 63% of them are saying that it’s so important that they’re able to market to and attract that younger audience of customers that we know are on social in general and TikTok in particular.

So Marianne, what kind of skills are needed to really translate views into purchases, especially when it comes to TikTok?

MARIANNE RAUSCH: I think that’s really the beauty of TikTok and why we felt like it was such a perfect platform for us to partner with, which is that the type of content that does really well on TikTok really lends itself to the type of stories small business owners can and should tell. So it’s a lot of behind the scenes content, really real authentic content that is the lo-fi. And people just want to hear the authentic emotional story about what makes these small businesses so unique and the interesting contributions that they’re making to their community.

Marianne, what are you expecting sales to look like this year? And I guess just talk to us about the importance of Small Business Saturday, especially coming out of the pandemic when so many small businesses, if they did survive, they barely did.

MARIANNE RAUSCH: Absolutely. So we know that small businesses are continuing to feel post-pandemic challenges, including, of course, right now the macroeconomic pressures, most notably inflation. We heard from 72% of small business owners that they are feeling real concern about the impacts of inflation for their businesses this holiday season. So we want to make sure that we are helping them address and work through that.

We also know from an American Express study that consumers are thinking about operating on a budget this holiday season and are going to be thinking about budgeting when they make their holiday purchases. So we think it’s more important than ever that we’re keeping it really top of mind that when you’re making those holiday purchasing decisions to make sure that you’re considering and thinking about ways you can support small businesses.

And we know that word of mouth and trust plays a big role, especially when it comes to small businesses. And we know that, according to your survey here, nearly 2/3 of consumers prefer shopping with businesses that give them the option to shop online as well as in person. When you sort of tie that all together, how much harder is it for a small business in this sort of environment versus, say, a big giant like a Walmart, who’s also trying to clamor for these customers as well?

MARIANNE RAUSCH: I think it is inherently harder for small businesses to break through and compete in our sort of digital first world of commerce that we live in now, which is exactly why we felt like it was so important for us to partner with TikTok and really empower small businesses to both understand how to be effective marketers in this digital and social first world and also then provide them with really tangible resources to take those learnings and put them into practice, which is one of the reasons that the accelerator includes a $100 advertising credit on the TikTok platform. So we want to help you learn what to do and then help you actually put it into play.

Marianne, given the conversations that you’ve had with so many small business owners, give us a sense of the biggest challenges that they are facing. Because we talk about it all the time. The economy is slowing. We also have a labor shortage we know a number of businesses have also faced issues with supply chain. And most recently, that continues today.

MARIANNE RAUSCH: Yes. I think you’re really hitting on, honestly, the core issues there. I would say that they’re feeling the forces of inflation. They continue to feel supply chain shortages, which we know are leading consumers to shop earlier this year for the holiday season. So I think some of the things that we’re encouraging small business owners to do or to think about making sure that they’re putting their holiday marketing out there even earlier and making sure that it’s going to be getting to consumers at the time when they’re making those maybe more limited holiday purchases this year.

And so, Marianne, what is your expectation for this holiday spending that you might see for consumers?

MARIANNE RAUSCH: So I think that we do feel that it will continue to be a strong season. I don’t have a crystal ball, unfortunately. I think wallets will be tighter. But I think people are going to continue to get out and support small businesses. And we are continuing to remind consumers that even though they’re being more careful about where they spend their money, to keep in mind that every time you spend $1 at a local small business, $0.68 of that dollar stays in the community. So just to be mindful of when you have to make decisions about where to put that money, putting it into a small business can have returns for your entire community.

It certainly does. All right. Marianne Rausch, great to have you. Thanks so much.

Leave a Reply

Your email address will not be published.