How Small Businesses Are Changing Their Strategies During COVID-19

How Small Businesses Are Changing Their Strategies During COVID-19

November 4, 2020         Written By Heaven Speirs

This year has tested the resilience of every business in America. While many small business owners feared for their survival during the pandemic, they’ve found creative ways to maintain operations. A new study from American Express reveals how small businesses have changed their strategies during the outbreak and what they plan to do for the upcoming shopping season.

Small Businesses Adopt Contactless Payments during Pandemic

At the beginning of the pandemic, the World Health Organization urged consumers to use contactless payments instead of cash or card. This reduces the risk of germ transmission for both the buyer and the cashier. The Amex Digital Payments Trendex found that 66% of small business owners prefer customers pay with a card or app instead of cash. Moreover, 60% of small businesses said their customers were actively requesting to use contactless payments.

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In a separate study from Visa, 78% of consumers said they have changed the way they make purchases because of the coronavirus outbreak. Many claimed to have switched to online orders instead of in-person shopping, while others said they’ve adopted contactless payments during the pandemic. Back in July, JPMorgan found a strong correlation between in-person payments and COVID-19 cases.

Ecommerce Will Be the Focus of 2020 Holiday Shopping

A staggering 70% of small business owners say they’re prioritizing ecommerce for the coming months. For businesses that previously lacked an online presence, 40% have adopted or plan to adopt online shopping solutions. A Chase Ink study from last month found that 35% of small businesses would not have survived without ecommerce.

Two-thirds (66%) of small businesses have already offered free shipping and online returns programs because of COVID-19. In addition, 33% plan to increase their social media presence to keep in touch with their customers.

Nearly Half of Consumers Plan to Shop In-Person for the Holidays

Despite the strong shift businesses have made to ecommerce, many consumers still plan on visiting stores for holiday shopping. The Visa Back to Business Study shows that 48% of shoppers want to do the bulk of their shopping in person, while 26% plan to shop mostly online. The remaining 26% plan to have an equal mixture of online and in-person shopping. Nearly 1 in 4 consumers plan to shop local over the holidays, which could prove helpful for struggling small businesses.

Digital Gift Cards Should See Big Growth in 2020

Gift cards are always popular around the holidays, but they may take on a new form this year. The digital gift card market is projected to grow 32% in 2020. Consumers are also 19% more likely to gift trips and activities to their loved ones over the holidays, and digital entertainment should see an 18% increase over 2019. Small businesses that can align with these changes may tap into a strong growth opportunity to round out the end of the year.

The information contained within this article was accurate as of November 4, 2020. For up-to-date information on any of the terms, cards or offers mentioned above, visit the issuer's website. Many of the offers on this article are from our affiliate partners, and LowCards.com may be compensated if you take action with any of our affiliate partners.

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About Heaven Speirs

Heaven Speirs is a contributing writer for LowCards.com. She remains up-to-date with the latest developments in the credit card industry and the financial sector as a whole. Heaven has over 10 years of experience in online journalism, the bulk of which has been focused on personal finance. Heaven attended Oklahoma State University, where she discovered her talent for research and content creation. In her spare time, Heaven enjoys painting, playing poker, and spending time with her husband and three dogs.