4 Ways Small Shops Can Compete with Amazon

July 16, 2019 02:39 AM

Small businesses can take on the big boys (like Amazon) and compete in the evolving world of retail with these four strategies.


By Meg C. Hall 


Make sure you're getting a slice of the pie this Prime Day. (Photo: GNT STUDIO/Shutterstock)


Amazon has undoubtedly reshaped the face of retail worldwide. As of July 2018, the online giant held a whopping 49 percent share of all U.S. e-commerce sales — five percent of the nation’s total retail spend.


But despite the “Amazon effect,” brick-and-mortar stores are still holding strong. The U.S. Census Bureau estimates 89 percent of all retail purchases made in the U.S. during the first quarter of 2019 took place in physical stores.


While Amazon may be able to charge low prices, have tons of inventory and spend big dollars on advertising, that doesn’t mean small businesses can’t compete. In fact, small retailers have an opportunity to win some of the business larger stores are losing.


Here are four strategies to help your small shop take on the big boys and compete in the evolving world of retail.


Cultivate personal relationships


One major advantage small businesses have over Amazon and other large companies is the potential to get to know their customers personally. Big box stores may have large email lists and other aggressive ways to keep in touch with customers, but a more human approach can go a long way.


“Many small boutiques are doing well in the current retail environment because they are able to present a human touch. They are able to focus on personalizing and catering to consumer needs,” said Naomi Coleman, founder and creative director of boutique PR and branding agency Access by NKC


Small retailers can use consumers’ trust in “the little guy” to their advantage by focusing on personalized in-store services, she said. “Online stores can offer many personalized recommendations, but not a human touch. Investing in an efficient work staff and different amenities throughout the store can help drive traffic by forcing consumers to come in and see.’”


Even simple acts, such as greeting regular customers by name when they enter the store or offering newcomers a big smile and introducing yourself, can go a long way toward building rapport with your local market.


Mix e-commerce with in-store service


E-commerce is booming globally, as more consumers than ever before are looking for a seamless, omnichannel shopping experience from their favorite brands — from large, big-box retailers to small, mom-and-pop shops.


Coleman suggested finding ways to merge your in-store and e-commerce services to give shoppers more options, such as in-store pickups.


“Most consumers love the efficiency of ordering online but hate the shipping cost and time. Retailers offering in-store pickups create a convenience factor for their consumer while increasing the chance for another sale by having the consumer visit the store,” she said. 


Stand for something


Embracing a cause can also give consumers a reason to identify with you, and when that happens, they’re far more likely to become loyal fans.


“Currently, many consumers are searching for brands that share their beliefs and understanding [of] the world around them,” said Coleman. “If retailers can establish that they are aware of certain issues and publicize their involvement in any cause, they can showcase that profit isn't their only focus.” 


A tight budget and busy schedule might have kept you from exploring ways to give back, but there are affordable strategies. You can support your community in a way big box stores can’t. 


Introduce your business to a new demographic by volunteering your time. Put on a branded shirt and work at a local charity event. Donate water bottles with your business’ name to a school fundraiser. Sponsor a youth sports team. Get creative and get your name out there. 


Set yourself apart with unique products


Another way for small shops to stand out is to focus on stocking local products or products few other retailers sell, which minimizes the strain of competing with online pricing. It also encourages customers to buy now or risk missing out on the item forever, Coleman noted. 


“The sense of urgency is created to showcase the importance of visiting in-store. In some cases, knowing that something won't be available ever again and/or at a reasonable price will keep consumers on the lookout for future products.” 


At the end of the day, consumers need to shop somewhere. And if you can offer something big-box stores and even Amazon don’t, you can grab a bigger slice of their spending.