Small Business Saturday: Great for AmEx, But What About Small Merchants?

On the off chance that you missed the onslaught of television ads from American Express, last Saturday was heavily promoted by the credit card giant as the first "Small Business Saturday." Small merchants were encouraged to register on the AmEx site, where they could download signage for their stores or websites; a Facebook page for the event attracted over a million fans; and consumers who registered their AmEx cards were promised a $25 credit on their bill when they shopped at participating merchants (that promotion has since been extended to the end of December and all small business that take AmEx are automatically enrolled). The idea was to help small businesses educate consumers about the importance of shopping local. For instance, when you spend $100 at a locally owned independent retailer, $68 goes back into your community, while the same amount spent at a national chain yields only $43 for your home town.

So was the day successful? I reached out to small retailers via Twitter, Facebook, HARO, and my own network to find out. Here's what they said:

• Lee Zalben, founder and president of Peanut Butter & Co, a sandwich shop in lower Manhattan, says "the percentage of purchases paid for using an American Express card tripled on Small Business Saturday." Still, he notes, "we talked to our customers and while some knew about the $25 statement credit they'd get by paying with their American Express card, many did not." Zalben says he was grateful for the support from AmEx but wishes that he had found out about the event sooner, an almost universal complaint among the small business owners I spoke to. "We only found out about Small Business Saturday about two weeks before the event," he says. "Most small business owners are overworked and overwhelmed. When we get something that needs to be acted on so quickly, we have to stop everything to plan for taking advantage of it. I think it would have been better if they told us about the promotion some time during September." He also feels strongly that since many small business sell on the web, that the $25 statement credit should apply to online purchases as well. It doesn't.

• Jodi-Tatiana Charles, CEO of La Capoise Galeria, a Boston-based photography studio, found out about Small Business Saturday through Facebook and local radio ads. She signed up for the promotion and was able to download a logo and an html, which she attached to an email promotion. "In the days leading up to and on Small Business Saturday, I had a 45% jump in inquiries and 21% in sales," she says. "The American Express campaign brought awareness to my company in a way that would not be financially possible. In the long term, time will tell how long the AMEX commitment will last, in the short term the marketing has been priceless."

• Eve Lowey, owner of Studio Chameleon, a design boutique in Newport Beach, CA did her best to promote a Thanksgiving weekend open house as part of Small Business Saturday but feels that customer awareness was low. "For Saturday we were pretty flat compared to last year, but Friday was better than usual," she says. "We had some customers on Friday have us hold their purchases until Saturday in order to take advantage of the incentives from American Express." In the future, she says, "It would be really great if American Express would work with businesses directly more. We had no idea Small Business Saturday was happening until two weeks before the event. We found out through reading the paper, not from American Express--and we take their card. We had talked to a lot of local press and many of them hadn't heard about it either."

• Sally Scimé, the owner of Mindful Hands, a gift shop in Old Town Alexandria, VA, used AmEx's graphics on her website and in an e-newsletter to customers. 'Sales were up by 18% over the same day last year," she says. "I don't know that all of the increase was attributable to the promotion but it certainly helped!" Several customers, however, didn't know about the statement credit so many registered at the store using their mobile devices. "I was also tweeting all day to encourage people to shop their favorite local stores on Small Business Saturday," says Scimé. "As a result, visits to my website increased by more than 25% that day, with 65% of those visitors being new to the site. I had two online sales which is a lot for a small shop like mine."

• Debbie Schaeffer, owner of Mrs. G TV & Appliances, a third generation family business in Lawrenceville, NJ, says that traffic at her store was strong on Saturday. She took advantage of AmEx's offer of $100 worth of Facebook advertising for participating small businesses, and is eager to see the stats on the click-throughs, which AmEx has promised to provide. "I think people knew about the AmEx promotion but didn't know they had to sign up," she says. She encouraged people to sign up in the store. Schaeffer is a big fan of AmEx OPEN, the company's small business division, but still thinks the company should have done more to educated communities about the promotion. "If I had known about it ahead of time, I would have done a little bit more with it," she says. In the future, she hopes that AmEx will partner with local community groups, such as Sustainable Lawrence, to more heavily promote the event

• Spend less money on TV ads and devote more resources to contacting their small business customers to educate them about the day.

• Reach out to AmEx cardholders more aggressively so that they know they'll be financially rewarded for shopping locally.

• Partner with community organizations, local business alliances, and local media to raise awareness of the day.
• Here's a radical thought: Partner with other credit card companies on Small Business Saturday to really send the message that the day is all about promoting small business, and not about promoting AmEx.

• Continue to build momentum for Small Business Saturday by supporting local sustainability efforts and small business patronage all year long.

If you liked this post, you might also enjoy Three Reasons to Pull Out Your Wallet for Local Businesses.