American Express Co. is encouraging ISOs and agents to use Small Business Saturday to stimulate transactions, increase charge volume and differentiate themselves from competitors.
ISOs see it as an opportunity to share the success of the small business outreach effort and position themselves as an advocate for small to midsize merchants. Doing so, they say, will likely pay off in profits down the road, even if the actual return on investment is hard to quantify.
“The days of the hard sell are gone. I believe that establishing yourself as a true advocate [of small business] is a way to build business,” says Kevin Jones, president of SignaPay, an ISO based in Irving, Texas.
Sandwiched between Black Friday and Cyber Monday, Small Business Saturday was created by American Express Co. in 2010 as a day to support the local businesses that create jobs, boost the economy and preserve neighborhoods around the country.
It worked. The buzz around Small Business Saturday prompted an estimated 103 million Americans to shop at independently-owned small businesses in 2011, according to Amex. Even President Obama took part in the day by shopping with his daughters at an independent bookstore a few blocks from the White House.
Meanwhile, the “movement”—as Amex calls it—has taken on a life of its own, beyond anything the initial sponsor originally envisioned. Without contacting Amex, businesses, associations and even local governments are creating events keyed to the Amex promotion. Support for the day has become so widespread that the U.S. Senate unanimously passed a resolution, designating Nov. 26 as Small Business Saturday.
Seize The Time To Leverage Event
Now, acquirers, who haven’t already done so, should stake their claim to the event, observers say.
Despite the fact that the holiday season is months away, it’s not too early for ISOs to get involved with Small Business Saturday initiatives if they haven’t already, says Scott Krugman, a Small Business Saturday Spokesman and and director of corporate affairs and communications for American Express Open.
Indeed, while public awareness of the day rose to 65% compared with 37% in 2010, there’s still work to be done to reach the 26.8 million small businesses in the U.S.
“It’s so new that not all small businesses know about it yet, so there’s still a need for marketing to create awareness,” Krugman says. “There’s a lot of potential here.”
For example, they can encourage their merchants to participate in the day and help them to create promotions around it, Krugman says. ISOs also can encourage their small business customers to visit the Small Business Saturday Facebook page for marketing tips, materials and help with social media marketing.
Indeed, social media has been a primary way to get the word out to the masses about Small Business Saturday. Since 2010, 2.8 million users have “liked” the primary Facebook page associated with Small Business Saturday. Businesses can go to the site for information on how to create a Facebook business page, how to encourage followers on Twitter or create a video on YouTube.
Besides building awareness among their small-business customers, ISOs have a good opportunity to provide their own marketing materials to businesses that aren’t computer savvy or whose owners don’t speak English fluently. They could even provide some sort of financial incentive to customers for participating in Small Business Saturday, says Peggy Olson, principal at Strategic Marketing, a marketing and consulting firm in Phoenix,.
In 2011, for example, hundreds of thousands of consumers registered their American Express cards to receive $25 statement credits when they shopped at a small business on Small Business Saturday.
And 40,000 people received $25 America Express gift cards courtesy of FedEx for use at small merchants on November 26th. That type of potion is something ISOs could offer as well.
Use The Promotion To Differentiate
With the competition among ISOs so fierce, those soft-sell marketing initiatives can differentiate one ISO from another, Olson says. “It’s one more vehicle to attract merchant customers as well as help them generate more transactions and increase charge volumes,” she says.
“Anybody that has relationships with small businesses should be encouraging those businesses to leverage Small Business Saturday because of the importance of small businesses to the economy and frankly to show that they really care,” adds Krugman of American Express.
An extended version of this article is scheduled to run in the April print issue of ISO&Agent.