The COVID-19 pandemic caused a number of shifts in behaviour across individual consumers and businesses alike. The UK government issued both national and regional lockdowns throughout 2020-2021, and with that, a new sense of loyalty to local businesses emerged. With small businesses pivoting their services to support their communities, almost half of UK consumers (46%) say it is more important than before to shop with small businesses.
So how should SMEs be capitalising on this emerging support and loyalty to local?
We gathered industry experts Mike Elliff, CEO Tyl by NatWest, Anthony Impey MBE, CEO Be The Business, and Pollinate’s Co-Founder, Fiona Roach Canning, along with PYMNTS Editor-in-Chief, Matt Nesto, to discuss. Here are the key takeaways.
The reason why people enjoy going to their local shops is because they’re recognised, and it’s a personal and friendly experience. We did some research last year, and we found that in just the first three months of the lockdown in the UK there was three years’ worth of innovation and technology adoption among small businesses just to keep their operations running in the face of lockdowns. A lot of SMEs started to use online payments and contactless payments that previously hadn’t. There is definitely momentum, and we now need to build on it. Small businesses now understand the immense value and equalising effect that technology can have on their business with much larger rivals.Anthony Impey MBE, CEO at Be The Business
“Customers have a very clear intent that they want to support local businesses – one that’s been particularly emphasised over the past 12 months. They see small businesses as part of the community and want to help invest in that. Not everybody will follow their intent as much as they should, so the opportunity there is really for small businesses to take the initiative and use technology to try and lock in these consumers, retain them, and then continue to grow the business from there.
We’ve got all this tokenised data that can be used safely without the need for the merchant to get their hands dirty with card data, and consumers trust it because it’s being managed by a bank they recognise. The big challenge going forward is for small businesses to not take that for granted and look for the opportunity to harness data, which can now be done.”Mike Elliff, CEO at Tyl by NatWest
The UK has always been a very rich loyalty market, but we’ve seen a massive need now for SMEs to have this communication channel with their customers. Technology is one part of the answer, but the other is data. That’s why working with banks is great, because they have access to so much data that can really help these small businesses understand their customers, understand their business, and then be able to compete with these larger companies who maybe invest hundreds of millions running their own loyalty schemes to get that data in a way that a small business never could.
Small businesses are the catalysts for innovation. They are the people who have shown that they’re nimble, who have reinvented reimagined and gone through incredible hardship. I think that they have a moment where consumers really want to support their local communities, but there’s a realisation that they can’t do it alone. A lot of the infrastructure that small businesses need to succeed — the buying power, the access to delivery partners — is much better if they act as a collective. And banks can be that connection.Fiona Roach Canning, Co-Founder at Pollinate
Pollinate works with banks to make better use of the wealth of data they own to transform their merchant acquiring solutions for business banking customers. Join NatWest and National Australia Bank (NAB) by checking out our platform and getting in touch with our team.