Leslie Bowers’s customers didn’t flood her store on Thanksgiving night to look for early Black Friday deals because she wasn’t open. Days after digesting their holiday dinner, though, shoppers showed up in droves to Peace of the Earth, her natural bath boutique in a trendy Louisville, Ky., neighborhood, opening their wallets for Small Business Saturday.
The marketing campaign, created by American Express (AXP) in 2010, encourages people to shop at local, independent stores and offers AmEx cardholders a $25 rebate to do so. In the process, American Express and its merchants highlight the intangible benefits of “shopping small.” Small Business Saturday doesn’t intrude on Thanksgiving dinner or mean rising before dawn to get deals.
“One of the things—in talking to our customers—that they talked about was just [that] the experience is much more pleasant,” says Bowers, who said her sales on Nov. 24 were four times those of an ordinary Saturday at this time of year. Peace of the Earth manufactures its own line of soaps, candles, and fancy bath products, and Bowers says customers “love the idea that they’re getting something that’s made locally and made by a small business.”
It’s clear that the promotion, advertised weeks in advance, helped AmEx and its sponsors capture a bit of the love that the American public often bestows on small business. Though merchants cite anecdotal evidence that the campaign helps, it’s not clear how much the one-day pop in sales moves store needles over the course of the shopping season. American Express hasn’t yet released data from the promotion.
In previous years, the company has said AmEx transactions at local merchants increased by 23 percent on Small Business Saturday. Besides encouraging shoppers to pay with American Express cards, the campaign helps the company win over merchants, who pay higher fees for accepting AmEx than for Visa (V) or Mastercard (MA) swipes.
“In addition to raising awareness of the value small businesses bring to the U.S. economy, we used our closed-loop model to drive business into small merchants by creating digital offers for American Express card members,” AmEx Vice Chairman Edward Gilligan told investors earlier this year. (Other companies marketing to small businesses, including Facebook (FB) and FedEx (FDX), have also sponsored Small Business Saturday.)
Though the idea now has big multinational marketing bucks behind it, Small Business Saturday builds on grassroots buy-local campaigns that independent business groups have promoted around the holidays for years, including the season-long Shift Your Shopping campaign. Indie stores try to highlight their shopping experience as more enjoyable than the neighboring Black Friday and Cyber Monday buying frenzies. “It doesn’t have to be sitting home alone in the basement or fighting mobs in the parking lot,” says Jeff Milchen, co-founder of the American Independent Business Alliance.
No doors were busted at Warners’ Stellian, a family owned chain of eight appliance stores in Minnesota, but the post-Thanksgiving weekend proved excellent for business. Sales were up about 70 percent over the same weekend last year—itself a good weekend, says president Jeff Warner. That boost came despite modest promotion.
“We’re not going to open early. We’re not going to be a place where people are going to stand outside and wait,” says Warner. “We flat out said: ‘Don’t give up your holiday; we’ll be here when you’re ready.’”
