Author: Rodrigo Alier, Executive Director, Partners & Brands at Glovo
The landscape for businesses right now is a challenging one. But, amidst the economic uncertainty, there is an opportunity for small to medium businesses (SMBs) to come out of the year stronger than ever. The secret ingredient behind this? Customers.
In June, Morgan Stanley forecast that the global e-commerce market would grow from $3.3 trillion today to $5.4 trillion in 2026. While the news is equally good for q-commerce, with the sector predicted to grow from its 2021 valuation of $25 billion, to $72 billion by 2025.
The coming year might prove a sizable bump in the road for these plans, but according to Glovo’s latest research, 82% of SMBs are still targeting significant growth in 2023. How businesses can do this is by becoming increasingly innovative and agile to customers.
Staying aligned to consumer needs has always been a business priority, but behaviour has been changing steadily since the days of the pandemic, and staying aligned to this has become both a challenge and a priority. For SMBs, the incentive lies in the fact that, if they manage it, they can turn 2023 into a year to remember and define a new business reality that lasts long into the future.
A constantly changing consumer
Post pandemic, shoppers demand more say in their shopping experience—with 84% of UK businesses believing more choice and personalisation is required by future consumers, while 78% believe consumers are more focussed on the digital, than the in-person, experience.
No wonder then that this shift in customer preference has been hard for SMBs to respond to. But it’s a challenge worth their time, as greater customer insights can not only help retention and revenue, but improve decision-making internally too, and feed into business strategy when it comes to inventory and cost outlay—a very timely money-saver given the current economic climate.
Building your business model around technology
A considerable area of opportunity for SMBs is technology. The pandemic caused businesses to digitise at a faster rate, and undoubtedly helped the sector’s valuation skyrocket during that time. Now, UK businesses see digitisation as integral to growth still, and to make the most of what the future of q-commerce holds, they must continue their technology journey—and adapt their business models around not only listening more to customers, but reaching out to them.
It is not just about being online though, but about having the technology infrastructure to offer a more personalised and meaningful customer service experience. This means more marketing and a greater social reach to make noise in an increasingly crowded market. But it will only work if it is invested with the level of choice and personalisation that good outreach needs.
Whether a business is hiring for this new technology-focussed business model, or looking to recruit a technology partner, the time for businesses to let technology do the talking, and the listening, is now.
Brand purpose and business transparency
Forging a relationship with customers isn’t just about selling, of course. It’s about transparently communicating brand purpose and connecting with them on a personal level. According to Deloitte, 57% of people surveyed indicated that they are more loyal to brands committed to addressing social inequities, while 94% of Gen Z expect companies to take a stand on important social issues.
Businesses should invest in their purpose, and feel confident and comfortable in communicating that to their customers. This not only applies to the world as a whole, but their sector too. For instance, SMB owners shouldn’t be tempted to follow a national fashion such as Black Friday if they believe in the circular economy and small business health. Instead, there are more sustainable, personalised ways of offering discounts that also double as a way of interacting with your customers, and not a calendar date.
Businesses must also now prioritise sustainability if they want to remain relevant in today’s world. Aside from the societal good, sustainability poses the most significant opportunity to their business. Q-commerce has the chance to offer and educate customers about biodegradable packaging and eco-friendly delivery options to better demonstrate a commitment to fighting climate change and commerce are not mutually exclusive.
Open horizons
Without question, now is the time for businesses to listen more to what customers are saying. But for many SMBs, the above won’t be possible when done alone. Small to medium businesses have always stood to benefit from support within their community, not just for their own sake, but for that of the wider landscape and the local economy.
With too many businesses still lacking the resources to optimise their customer service and shopping experience, finding a partner is key. This is what has caused bigger players such as Glovo to look inwards and help SMBs digitise their products and grow increasingly capable of connecting with customers through advanced marketing and advertising capabilities.
While the motivation for SMBs to accelerate their way to growth and sustainable profitability may be influenced by today’s climate, the benefits are not short term, but long term. Such is the power of optimised customer engagement and reach that when it comes to unforeseen challenges, opportunity is what’s on everyone’s minds.