As hectic as the holiday season can be, most retail shops embrace the frenzy in hopes of driving year-end sales. The same can be said for small business shops, as the holiday season can often make or break an entire year.

In fact, according to a recent study by Kabbage, while 38% of small business owners report steady sales throughout the year, a whole 44% say their highest sales period is the holiday season. With the importance of this season already at the forefront, let’s take a look inside the minds of both small business owners and their shoppers.

Small Business Holiday Optimism

Overall, recent surges in the economy have owners and consumers alike optimistic about the state of American business. And this optimism is validated by the successful years already reported by small business owners:

  • According to the Kabbage study, 76% say 2013 is already outperforming 2012.
  • 37% of those surveyed say business is “up more than 20%.”

These good signs point to strong sales at the end of the year, and many owners are hoping to cash-in on a big holiday sales season:

  • 80% of small business owners expect a stronger holiday season in 2013 than 2012, including 41% who expect it to be “much stronger.”

Holiday Consumer Shopping Habits

The Deluxe Corporation’s study shows there’s good reason for small business owners to look forward to holiday sales:

  • 35% of consumers say they’ll shop at small businesses and boutiques during the holidays, up from 27% in 2012.

This rise in shopping will hopefully warrant the optimism of small business owners, but the Deluxe survey highlighted some ways small businesses can capture a even bigger piece of the market. The biggest way is by improving the company’s online presence. While engaging content and active social media campaigns can go a long way to generating brand awareness, search engine optimization (SEO) and marketing (SEM) are keys to online success.

The rise of smartphones, tablets and e-readers has made online shopping even easier, but despite the ease, shoppers aren’t getting any more patient:

  • 51% of online shoppers do not go past the second page of search results when shopping.

While it may be too late to beef up your SEO before the holidays are over, an increase in regional search-engine ad buys can help boost last-minute sales. Beyond that, any downtime throughout next year is a good time to focus on SEO and organic users.

Recent studies also show that promotional gifts and discounts on goods and shipping can also drive sales. The Deluxe study expounded on these findings, as it asked consumers ways small businesses can cater to them during the holidays:

  • 47% say they’d like discounts on future products or services.
  • 18% say they’d prefer a holiday card.
  • 13% would like to receive a unique gift.

While discounts and sales are obvious ways to drive consumers to storefronts, hesitant owners can turn to online or traditional cards or small branded gifts as less-expensive incentives for shoppers.

When creating these promotions, it’s important to know reasons why consumers flock to small businesses in order to leverage that connection in marketing. Deluxe’s study asked consumers why they shopped at small businesses during the holidays:

  • 57% believe it’s important to support local businesses.
  • 49% say the merchandise is unique.
  • 39% like the suggestive and personalized service.
  • 25% say they offer good prices.

Whether you’re a mom-and-pop shop or an uptown boutique, it’s important to know your target consumers and to shape your marketing accordingly. This can go a long way to increasing brand awareness, which can increase both holiday sales and repeat customers. And focusing on loyal customers and repeat business can set any company up for success for years to come.


Deluxe Annual Holiday Shopping Survey

Kabbage: Small Businesses Expect Huge Holiday Season