Small Business Playbook
Small Business Playbook

6 ways small businesses can boost holiday sales in 2020 amid the pandemic

Key Points
  • Nearly seven in 10 small businesses see the winter holiday season as a top sales opportunity for their business, according to The Visa Back to Business Study – Holiday Edition.
  • Sixty percent of Americans will do the majority of their shopping with local retailers this year, the Visa study noted.
  • According to Deloitte, holiday retail sales this year should rise between 1% and 1.5%, amounting to between $1.147 trillion and $1.152 trillion during the November-to-January time frame. 
  • To take advantage of the trend small businesses need to have a strong digital plan and stay close to customers.
Source: Twenty20

Unlike most retailers, which see a sales peak over the winter holidays, revenue at Potomac River Running, a chain of 10 specialty running stores in Washington, D.C., and Virginia, is highest during the spring and summer.

But this year, coronavirus shutdowns hit the stores hard, with fewer runners training for big races, fewer back-to-school sales, and fewer people out shopping at all. So, owner Ray Pugsley is more focused than usual on making the most of the holidays.

"The holidays are big for us, but they're usually not as big as the summer," Pugsley says. "But this year, our goal is to try to cut our 2020 losses to some degree by beating our comps in the fourth quarter."

To prepare, the company has boosted its online sales, implemented touchless transactions, introduced local delivery, and created customer gift lists, along with putting in place a range of new safety protocols in its stores.

Pugsley isn't the only small business owner focused on making the most of the next few months. Nearly seven in 10 small businesses see the winter holiday season as a top sales opportunity for their business, according to The Visa Back to Business Study – Holiday Edition.

According to Deloitte, holiday retail sales this year should rise between 1% and 1.5%, amounting to between $1.147 trillion and $1.152 trillion during the November-to-January time frame. 

That's compared with growth of 4.1% in 2019, when sales were nearly $1.14 trillion. 

Ray Pugsley, owner of Potomac River Running, is mapping out a strategy to boost online sales for the holiday season.
Potomac River Running

Small businesses have already faced unprecedented challenges in 2020, and the holiday season appears set to bring plenty of its own, amid a shaky economy and continued concerns about another wave of coronavirus infections.

That could spell trouble for small businesses for whom the holiday season has an outsized impact on revenue.

"It can't be exaggerated how important it is," says Jeff Rosenblum, founder of digital marketing agency Questus. "In just a few days, many brands and small businesses can sell as much as they do the rest of the year combined."

Still, even in a difficult environment, there are opportunities for small businesses to drive revenue through the holidays. Sixty percent of Americans consumers plan to do the majority of their shopping with local retailers this year, the Visa study found.

"All businesses right now should be thinking about connecting with your customers digitally, getting creative in how to acquire new customers, wow the customers you have to improve retention, and watch expenses to preserve cash," says Jeff Jones, President and CEO of H&R Block.

Here's what else they should be doing:

1. Think digital

As Americans have moved much of their lives online in 2020, marketers who want to reach them must go online to meet them there. For retailers, that means having the capability to sell online, where sales could grow 30% this year, according to Salesforce.

"The good news is that getting online, if you aren't already there, can be as easy as a few clicks," says Rich Rao, Facebook's v.p. of small business. "And you don't have to do it all on day one."

If you're shipping products, make sure to let customers know the cutoff date for shipping by Christmas —and consider building in some time for delays this year. Curbside pickup and handling local deliveries in-house can further boost online sales. From May to August of this year, online shoppers spent 23% more when choosing local pickup or delivery, according to Shopify.

Even non-retail businesses can get into the holiday spirit online, updating their website or emails with holiday messaging. This year, especially, the holidays are a great time to connect with and check in on your most loyal customers.

"If it's a business that's not selling a product, you can get more aggressive with the human touch," says Jason Vandeboom, CEO of ActiveCampaign, a cloud software platform for small-to-mid-sized businesses that helps them connect and engage with customers. "Maybe it's literally an individual email or a message posted to a channel that they're on. You're just building customer loyalty over time."

Susan Henner, owner of Henner Law Group in White Plains, New York, says she plans to do more holiday cards and thank you notes virtually this year to keep costs down.

"Normally we'd get a lot of expensive gifts for everyone, but we are more budget conscious this year," she says. "We took out a PPP loan and an SBA loan, and we're doing fine with money. But I don't want to blow through it, and I want to keep everyone employed. I was lucky not to have to lay anyone off or reduce salaries."

2. Talk about safety

With safety concerns paramount, businesses that have in-person interactions are putting in place new protocols to make sure that they're keeping all employees and customers safe, and they're making sure to let customers know about them. At Potomac River Running, that includes extra cleaning and social distancing measures and the ability to make an appointment for private shopping.

At Sweets by Cari, a home-based bakery in Ossining, New York, owner Caridad DiMiceli has gone completely paperless for invoicing and payment.

"I've also changed all of my delivery options to contactless delivery and contactless pickup to ease any tension or fear around ordering from me," she says.

At Sweets by Cari, a home-based bakery in Ossining, N.Y., owner Caridad DiMiceli has gone completely paperless for invoicing and payment.
Karen Buldier

3. Prepare to pivot (again)

Many of the small businesses that have thrived over the past six months were able to successfully pivot their business models to meet changing customer demand: Yoga studios have moved all of their classes online; a dog boarding business became a mobile dog groomer; and a restaurant wholesaler began selling to consumers. Small businesses may need to again tweak their business models this holiday season in order to meet the needs of their customers.

"It sounds cliché, but this is the time to really listen to your customers," says Tom Sullivan, v.p. of small business for the U.S. Chamber of Commerce. "Throughout this pandemic, the small businesses that have focused on their value and how that value translates to a unique customer need are the ones who have been able to successfully pivot." 

This is an area where small businesses may have an advantage over their larger competitors. Their smaller sizes means they inherently have more flexibility to quickly adapt to a changing business environment.

"The way customers behave now is here to stay, and it will begin to normalize as stores find their footing again," says Arpan Podduturi, director of product, Shopify Retail. "There is a permanent shift toward e-commerce and omnichannel for every retailer."

Those who can make it through the next few months may emerge in an even stronger position once the pandemic subsides. Nearly 9 in 10 small business owners say they now feel more prepared for the future, and 79% say they consider themselves more tech savvy than ever, a Comcast survey finds.

"The discovery of all these new tools and all of this creativity that you didn't even know that you and your employees had is really a silver lining for some small businesses," says Karen Kerrigan, president of the Small Business and Entrepreneurship Council. "They're innovating and discovering new markets."

4. Celebrate your workers

Holidays are typically a time for companies to show appreciation for their employees, often with a holiday party or seasonal bonus. But this year social distancing guidelines may make it impossible for organizations to throw a traditional party. That's the case for Henner's law firm this year.

"Normally we would go somewhere really nice, to a local restaurant in the area, and give them business as well," she says. "But I don't want to be in a restaurant, and a lot of my employees don't want to be in one either, and by the time December comes it will be too cold to sit outside."

While Henner still expects to pay her employees a holiday bonus, many small businesses likely won't be in the same position. There are other ways to show appreciation, such as an extra paid day off, a hand-written note, or an inexpensive gift.

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Vera Oh,  co-founder of the vegan skincare line Glowoasis, typically flies employees to New York for company dinners and karaoke parties to celebrate the holidays. This year, the company is moving the party to Zoom and looking for other ways to make the time special for workers.

"We are planning to send turkeys for Thanksgiving and UberEats coupons for them to order holiday foods to enjoy during the virtual holiday party," she says.

5. Don't forget about self-care

It's easy for small business owners to get so caught up in worrying about their business they forget to take care of themselves or to take their own enjoyment during the holidays. Nearly two-thirds of small business owners identified themselves as stressed due to the business impact of Covid-19, and 68% say it's causing them to lose sleep, according to the Comcast study.

Small business owners may not even be aware of the impact the pandemic is having on their mental health, says Jill Johnson, CEO of the Institute for Entrepreneurial Leadership, a non-profit business consulting firm in Newark, New Jersey.

"Some people don't realize the stress under which they're operating or how it's affecting them," Johnson says. "It's important, especially now, to take some time to decompress. Take a day or two where you are not thinking about work and going to work, where you can refresh and rejuvenate."

6. Lean into your role as a small business

Consumers are well aware of the challenges faced by all businesses this year, and many want to do their part to help. Three in four consumers say that they're going to make an effort to shop from small and local businesses this holiday season, according to an AdTaxi survey.

That's good news for Pugsly, who says his holiday messaging is going to emphasize the difference that it makes when consumers choose to shop local.

"We want to highlight that we very much appreciate when you shop with us," he says. "We're a local family, and we're in your schools and in your community. We are all in this together, so please help small businesses if you want us to be around and in business in the future."