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GUEST COMMENT Unearthing new revenue streams and routes to profit through the power of digital

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The coronavirus has turned the world on its head, with lockdown restrictions disrupting people’s lives and putting a massive strain on small, local businesses, who rely heavily on consumer footfall to maintain cashflow.

Throughout lockdown we’ve seen small businesses innovate and adapt fast, implementing changes in weeks, which would have previously taken years. From local pubs turning into bottle shops, and cafes transforming into delis, it’s clear that businesses have been getting creative to attract consumers. However, many haven’t had the resources, income or capabilities to enable such adaptation, and as bills such as rental payments build up, it’s becoming harder to source revenue with a shut shop.

As we look forward, it’s important to think about how shopping habits will change and how physical experiences may be altered. Online has played a massive role in people’s lives while shops have been closed. While some small businesses may have made it this far through lockdown, it’s essential for owners to look forward and consider what business models will work for post-coronavirus consumers, many of whom will be far more tech savvy than before they entered lockdown.

This is where digital comes in. By diversifying sales channels, small businesses can ensure they stay afloat and connected to new and pre-existing customers. Below, I explore three ways that small businesses can take advantage of digital technologies to access new revenue streams.

1.     Going to market

While marketplaces have been active for years, their value has been magnified during the current crisis, where they’ve provided a lifeline to small businesses that don’t have an online store.

Using an existing platform like Groupon, eBay and Amazon Marketplace provides a quick route to market, as well as offering a flexible business opportunity with relatively low start-up costs. Some, such as Groupon, will also work with small businesses to help them get the most out of the platform. These marketplaces play a crucial role in expanding customer range, as they have exposure to consumers all over the country, as well as overseas. Businesses that join a marketplace now will likely stay on it when things return to normality – and notice a sales bump as a result.

2.     Social media presence

Lockdown has given people and businesses an opportunity to embrace social media. As a nation, we’ve registered an unprecedented rise in screen time, a 25% increase in engagement on Instagram and TikTok in the past month, and a staggering 72% increase on #ad content by influencers.

The power of social media has been amplified during this period of isolation, while boredom has driven many people to experiment with new platforms. The use of video chat apps, like Instagram Live, Twitch, Zoom and TikTok has risen dramatically, and private messaging apps like Whatsapp and Facebook Messenger have seen up to a 70% increase in use during lockdown.

Streaming features offered by social platforms have helped businesses stay connected to their customers. From restaurants hosting cook-alongs, beauticians giving nail tutorials, to hairdressers handing out tips on at-home highlights, local businesses have shown real creativity. While these channels have been great for businesses looking to keep up their brand presence during lockdown, this engagement will be even more effective when consumers can actually see their product or experience, and are able to leave their home to purchase it.

3.     ‘Phygital’ experiences

As part of adapting to a life without a physical stronghold, many businesses will have scraped together an online offering – be that in the form of a website or virtual experience. However, as life starts to go back to normal and businesses get the green light to re-open, it’s important they don’t just ditch new digital platforms, but strengthen them. Business owners need to consider what differentiates their in store offering and see how they can go about replicating this online.

Businesses also need to think about how consumer shopping habits will have changed once lockdown is lifted. Personal, face-to-face experiences will likely have restrictions under social distancing guidance, and consumers may now have higher expectations of a shopping experience having spent months online – for example queue-less shopping and fast payment processes.

While consumers will be looking for experiences they couldn’t get in lockdown, now is the time for business owners to really make sure their online and physical offerings align and complement each other. One way of doing this is by implementing a unified commerce system, which under one platform supports commerce for stores, mobile and the web, bringing together both the front-end experience and back-end applications. This can lead to more efficient business operations and happier customers.

Final thoughts

For a long time, the term ‘digital transformation’ was a very generalised concept, but the coronavirus crisis has really defined its meaning, particularly amongst small businesses. When there has been no other option, online has been the lifeline, and for many a new form of trading. It’s important to keep exploring its opportunities, even as life returns to normal.

The power of digital should never be underestimated – while physical experiences will always be in demand, a business can strengthen its offering further by harnessing online platforms, providing alternative revenue streams.

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