It’s Small Business Saturday. Has that concept been successful in the U.S.?

Posted on by Ted Bauer

Small Business Saturday 2012 registered about $4.5 billion in sales two years after being created (the concept was) by American Express. By some estimates, Black Friday 2012 registered about three times the sales ($11-$12 billion); that was even a drop of about 2% from 2011. 2013 Black Friday sales are expected to be up; it’s likely that $602 billion (damn) will be spent during the final two months of the year (that’s higher than growth last year, but still below pre-2008 figures for this period of a given calendar).

Point of the first paragraph, in a nutshell: Black Friday is for the big box stores and the electronics manufacturers; they dominate from a numbers perspective. Small Business Saturday is for the “mom and pops” — those that are perceived to have become more sparse thanks to Wal-Mart, McDonalds, etc. President Obama gets into the act: the last two years, he’s taken his daughters to DC-area bookstores on Small Business Saturday. It’s a big thing for the media, too: see here, here, here, here, and here. (The most ironic part of Small Business Saturday, FYI, is that American Express fees are actually pretty high for small businesses, so while they founded the idea of the day, it would actually be more beneficial for the businesses if you used cash or a personal check.)

Numbers on the impact of small businesses in the U.S. vary by source, but in general, it’s believed that something like 2/3 of new jobs in America are created by small business, and that about half of GDP comes from small business (“small business” is typically defined as having less than $5 million in revenue annually). At the same time that those numbers are big, though, small business optimism is historically low. That makes perfectly logical sense: while the economy is stronger than 2008-2009, it’s still somewhat unstable; insurance premiums for employees are a major concern for small business owners too. All that said, though, U.S. citizens seem to have more confidence in the idea of small business than anything else except the military. So the basic idea here is: small business is important, although optimism is low about creating ’em — but trust in ’em as drivers is high. OK.

Small businesses are definitely important to the local economy; here’s some data on small business and job growth in 2012. One interesting thing about this period of American business evolution is that small businesses actually have a slightly more even playing field than they would have had 15 years ago; I’m not saying opening a bookstore is a sure thing as compared to, say, opening a new Wal-Mart, but … if you’ve read The World is Flat or similar tomes, basically that’s the idea. If you open a small business in your community, you now have Google, Twitter, Facebook, Instagram, e-mail marketing software, analytic software, etc. to help guide you; this stuff can cost money, but not much. There are tricks everywhere. We’ve come a long way from a time where the main ways to promote your business were standard print/TV advertising; options and avenues are everywhere, and honestly, word of mouth is probably still the best advertising method. Small businesses can do that easily (well, relatively easily), because communities are based on people exchanging information about trends and their lives. Point is, if you want to establish a small business, it’s hard … but you can do it. America is, in its current incarnation, pretty driven by mass commercialism (see the sales numbers in the first paragraph), but percentage-wise, many of the opportunities still come from the small guys. We should always remember that.

Even the Commerce Secretary is into this Small Business Saturday idea:

So are “big players” like Merrill Lynch:

Not everyone is as positive, though:

Look, the basic idea comes down to this: it’s essentially a marketing technique. It’s not an official day or an official holiday; neither is Black Friday. Marketers realized that it’s a time of year where you’re probably a bit more relaxed (the holiday season is officially swinging along; you might even have a tree), you’re probably with some members of your family, you’re in a giving mood/spirit, and you broadly understand the idea that America was, in part, built on the small business model. The creators of the idea, much like the creators of Black Friday, just figured it’s a way to get you out to a a certain type of store; thankfully, this model is a bit more subtle than Black Friday, hence it’s doubtful Small Business Saturday will ever result in a #WalMartFights hashtag emerging. In a time of rising income inequality and a broader gap between haves and have-nots in America, go shop local. Support the economy and the efforts of those in your community who are trying something different, following a passion, and hell, employing your neighbors. The numbers may be confusing in terms of the actual, direct impact, but that doesn’t matter. This isn’t a day rooted in numbers; it’s a day rooted in an idea, and that idea is fairly simple: your community is valuable, so support it economically.

Ted Bauer

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