Global pandemic. Social upheaval. Economic headwinds. Administration turmoil.
That was 2020.
Against that backdrop, small and midsize businesses (SMBs), particularly brick-and-mortar retailers, had their digital “adapt or die” reckoning. In-person purchasing became a serious health liability; customers and workforces moved overwhelmingly to online-only models. It was the year SMBs turned to technology, irrevocably.
The pivot to digital that many SMBs made last year is only the beginning of their digital journey. In 2021, SMBs need to ensure they have fully exploited the power and benefits of virtualizing their operations, customer service, and relationships with their customers. Here’s what we can expect to occur in the coming year.
SMB digital transformation will continue apace.
2021 is the year SMBs further accelerate their digital transformations. Technologies adopted for COVID-19 propelled a digital-first or hybrid physical-digital business model that’s here to stay. Connectivity, e-commerce, and the know-how to succeed online are more important to success than ever.
An October survey of SMB owners by GGV Capital and Hello Alice found that 83% believe their business will perform better in 2021. Those that turned to smart digital solutions to survive the business impact of the pandemic found new ways to reach customers and improve productivity. Also, 75% of the survey participants plan to spend more on technology in 2021.
SMBs will invest in delivery of an excellent digital customer experience.
The upheaval of the last year accelerated a trend affecting all businesses and brands: the erosion of consumer loyalty. The entire purchase cycle is now enabled online. Previous barriers such as location, distance, transportation, and time are condensed or wiped out. The friction of physical consumerism is nearly gone.
Where does that leave the typical small business, when its customer base now has the entire world of retailers and their inventory available via their connected devices at a moment’s notice?
Actually, this is where SMBs may have a distinct advantage.
A bedrock principle of SMBs is the personal touch. They know their customers. Likewise, their customers know them and trust them to understand and meet their needs. However, their customers are increasingly seeking their goods online. SMBs need to meet them there, and ensure a robust, user-friendly digital presence that complements their physical presence and extends online.
I see the digital customer experience as a key priority for SMBs in 2021. SMBs seeking to improve customer loyalty and grow revenue will turn their attention to delivering excellent customer experiences digitally. Capabilities they will offer in their digital storefronts include intuitive user interfaces, smooth navigation, online chat, a smooth digital path from product selection to checkout, free or value-priced delivery, and easy online return/replace functionality.
SMBs that go all in on the digital storefront experience will be pleasantly surprised at how much they can learn from the anonymized data today’s e-commerce and social platforms allow them to collect and use. This treasure trove of data can help them determine the time and place to promote certain products over others, dynamically price their goods based on product demand indices, identify new sets of customers based on similarities to existing customers, and remarket products.
These capabilities can help SMBs virtually replicate the in-person, personal-touch experience. They can also help SMBs identify and accumulate new customers to their always-on, available-to-anyone digital storefronts.
Customer communications will take center stage.
Facing a contactless future, SMBs will use email and social media messaging more frequently – and more strategically. According to the fourth edition of the Salesforce Small and Medium Business Trends Report, SMBs expect to be more careful about their communications, expand ways they can reach their customers, offer more flexibility, and prioritize customer relationships over one-off transactions.
This emphasis on enhanced customer communications requires dependable, high-speed connectivity. SMBs will increasingly turn to fiber-based solutions for reliable, ultrafast connectivity and high-speed internet to support expanded customer communications, video conferencing, and the sharing of data-rich media. Fiber supports easy and fast access to customers, website expansion, and an improved customer experience. Our fiber solutions are offered to businesses as stand-alones or bundled with cybersecurity solutions to help them protect their technology investments.
Corporate social responsibility will be tied to business success.
The urgency of our collective racial awakening and the escalation of environmental and social issues came into full relief nationwide last year. The events of 2020 created a groundswell of demand for businesses to demonstrate a purpose beyond making money.
How fast is the concept of the purposeful business taking root? For example, investors using environmental, social, and governance (ESG) investing tools can now choose from dozens of causes to invest in, such as reducing greenhouse gas emissions, supporting LGBTQIA+ rights, and divesting from big tobacco, fossil fuels producers, and weapon-makers.
SMBs get it. According to the Salesforce survey, 45% of SMB leaders in the U.S. say they are taking at least one step to address racial injustice, as just one example.
2020 taught SMBs the importance of agility and resilience.
The pandemic-induced shift to remote work and contactless commerce underscored the importance of digital transformation as a driver of business agility and resilience for SMBs. We know from our own customer base that the shift to working from home at scale drove exponential increases in bandwidth requirements for many businesses.
In 2021, we expect SMBs will continue to invest in connectivity technologies that support communications and the flexible, hybrid (home/office/storefront) workforce model they’ve adopted. Fast, robust, highly secure, and reliable connectivity is now table stakes as business activity, like consumer activity, has moved online. This includes meetings, events, presentations, negotiations – all are now enabled and conducted through connected devices. It’s not merely the sales process that has been virtualized, but almost all of work, calling into question the necessity of “the workplace.”
We also expect SMBs will continue their uptake of backup and recovery networking solutions to ensure all is not lost when the forces of climate-led or manmade incidents bring technology systems to their knees.
2021 is the year of the digital SMB.
Digitally savvy, purpose-driven brands and businesses will be in the vanguard in 2021. These businesses will find new customers and deepen customer loyalty by winning hearts, minds, and a greater share of customer spend. The winners will deliver niche services that meet customers where they live with more personalized services: e.g., the dry cleaner who picks up your clothes from your house, the virtualized personal trainer, telehealth, and home delivery of food and other goods. The maturation of 5G will allow businesses to reimagine their operations with graphic- and video-rich content to reach new customers.
SMBs and their owners are the lifeblood of the local community and the heartbeat of our economy. It is important that they thrive. In 2020, millions of them made the move to digital to stay afloat and grow during one of the toughest years in modern history. Now, they are recalibrating their digital strategies and assessing opportunities as the COVID-19 vaccine rolls out, relief money flows in, and a new administration settles into the White House.
For SMBs that make the right digital investments, a better year awaits.