The uncertainty of the last few years have caused
concern among small business owners.
Small business owners have one of the most difficult jobs in the economy as they need to handle the ups and downs that come with the life of being an entrepreneur, but the last few years have given them more challenges than anyone could have anticipated.
Economic uncertainty, inflation, staffing shortages, evolving consumer behaviors and rapid changes in commerce options have left merchants with more questions than answers.
In an effort to better understand our merchant customers, we reached out to several business owners around the world to ask them what their most pressing questions are for 2023. Determined to help bridge the gaps these merchants identified, we sought out experienced business leaders within PayPal as well as outside advisors to help answer their questions.
In the first part of our three-part series, we collected questions around limited cash flow, marketing and challenges around connecting with consumers.
Our advisors for this round of questions include Candace Conley, the owner and founder of a recreational cooking school called The Girl Can Cook as well Belinda Koh, a senior director with our sales team at PayPal and Bernardo Martinez, PayPal’s Vice President of Microbusiness.
Here are some of the questions they received and the advice they shared based on their experience.
Small business owners want to know how to best promote their business.
Candace: There are a lot of options besides paying for advertising that will help you build and maintain healthy sales. Although social media is important and is a great way to connect with your customers, you can’t always count on it. Algorithms are constantly changing, and so a business owner doesn’t have sufficient control over his/her/their audience. For our business, a better strategy is to constantly build and nurture an email list that we can control and then we aren’t dependent on the whims of the social media giants. With an in-house mailing list, you know you are reaching your audience with the content you create like blog posts, videos, or newsletters. It is also important to be in control of your website and keep it updated and optimized for search engines. That means when potential customers are searching for your type of business, you rank high in the search results and people can find you easily. You can’t sell to people if they can’t find you. Using several different approaches will help keep your sales strong. Don’t depend on just one technique.
Belinda: Optimizing your site with SEO is an important step but it can be an expensive endeavor. As a result, many businesses have started exploring other avenues, including advertising on social media. What is becoming increasingly popular is live streaming selling with a targeted audience. In North Asia, we are seeing AI enabled live streaming (imagine a robot selling consecutively!) It’s also becoming increasingly common to see small businesses use the power of influencers to promote their products on their social media accounts.
There are many creative opportunities to help promote your business. Staying on top of tech trends will help inspire out-of-the-box ideas.
SMB owners say they struggle with cash flow.
Bernardo: For many small businesses, growth requires additional investment – and sometimes credit is needed to support the investment. Before taking any action, ensure you have a good understanding of what you are going to do with the loan and the expected outcomes you will foresee in the investment. Once that is determined, the challenge lies in finding a partner to help fund that growth. Too often small business owners look to traditional methods – government aid, traditional financial institutions – to provide the capital necessary for their business. What small business owners sometimes overlook is that there are alternative loan offerings that can help power the growth. For example, payment processors or accounting software providers have a deeper understanding of the individual businesses. Having a 360-degree view of your business enables those companies to provide the necessary capital with speed and terms that accommodate your business.
Candace: "Cash flow is always a problem for small business especially with rising costs around rent and utilities and overhead. If you have a seasonal business like we do, cash flow becomes even harder to manage. I would recommend finding a credit card with an easy application process, great cashback rewards, no annual fee and loans matching repayment to your cash flows. It just gives me more flexibility, and I don't have to worry about it."
Belinda: The more people shop online, the more important is to create an easy and efficient user experience. It’s important to look into multi-channel touch points in order to create a seamless experience for customers whether they are online or in-store. Each segment will have different needs but create an experience that provides options and flexibility for customers. For example, give your customers the option of communicating their questions through a chatbox. Incorporating AI into a customer service experience will soon be commonplace. Allow them to buy online and return in store and other moves that will remove any disconnect between their online and in-store experience.
Candace: It has always been important to keep your customers happy. Remember, when you think you appeal to everyone, you actually appeal to no one. Know your customer niche.
Through our email list, social media, and direct contact, we develop solid relationships with our customers. They receive weekly email newsletters with any class updates or events, our social posts occur daily (some are business-related while others are just fun) and they get to know us and what we can offer them. It’s always a good idea to share who you are and what your business represents to find your perfect customer fit. As we add more online offerings, it will also be important to be flexible with our strategies to stay in touch and give them what they’re looking for. Having a mailing list and staying in touch with our customers (with as much customization as possible) has become very important to our business and helps us identify our customers. Customers like to feel you are talking directly to them so keep it personal. We keep them engaged and informed and are better able to anticipate what they are looking for.
For more tips, tools and insights relevant to SMBs, check out our Business Resource Center.
The content of this article is provided for informational purposes only. You should always obtain independent business, tax, financial, and legal advice before making any business decision.
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