What Do Customers Want from Local Businesses?

A recent survey of over 6,000 consumers suggests that customers prefer to do business with small local businesses than the national chains. We see the clear evidence of this in the news every week when we hear another large chain store closing a store or going into liquidation and making thousands of staff redundant.



More than eight in ten consumers (82%) currently use local businesses, and 48% plan to patronize local businesses even more often. (Fewer than 1% expect to use local businesses less often.)

In fact, consumers use local businesses more often than national chains. In the last twelve months, local businesses accounted for 56% of total business use, compared to just 44% for national chains.


Consumers aren’t turning to local businesses out of necessity, but out of preference. The survey asked respondents to judge whether local businesses or big businesses have each of the following qualities.


Here’s what people said local businesses offer:

  • More personalized service: 96%
  • Being trustworthy/treating me fairly: 91%
  • Customer service: 80%
  • Delivering quality work: 86%
  • Being reliable/delivering what’s promised: 79%
  • Having professional staff: 75%

National chains only outperform small businesses in only two areas:


70% believe national chains are more likely to have a stable business

77% say they offer more competitive prices.


72% of respondents are willing to pay more to get the quality service they believe local businesses offer.

Though local businesses are doing a lot of things right, there’s still room for improvement.


Here’s what customers want to see that local businesses aren’t delivering:

  • Easy-to-use App: Using an app is the top priority respondents want to see in local businesses in the coming year
  • Special offers for returning customers: According to the survey, this is the top way local businesses can differentiate themselves from competitors. Nearly half (49%) would like to see more specials, deals, and offers (and 20% say they’ve seen businesses adding more special offers in the past year)
  • More frequent online communications: Consumers want to get the following communications from local businesses:
    • Service/appointment reminders: 84% (only 3% currently receive these)
    • Advice/helpful tips: 80% (only 26% currently get these)
    • Business news & discount updates: 76% (only 19% currently receive these)
    • Survey requests for feedback: 67% (only 13% currently get these)
    • Personalized communications: 65% (only 15% currently receive these)
    • Invitations to events: 63% (only 12% currently get these)
    • Newsletters: 60% (only 15% currently receive these)
  • Online reviews: 76% want to see online reviews for local businesses. Consumers are turning to reviews and social media more often to find companies, and they expect to see reviews they can use to make buying decisions
  • Self-service: Arounds 25% of respondents want to make payments, book appointments, manage their bills with local businesses online

Clearly, there’s a lot of room for improvement in how local businesses communicate with their customers.

How to Make Your Small Business More Successful


Focus on Customer Service

According to another recent study by NVM, 51% of customers will not repeat business with a company after a bad service experience. Many other studies have shown that it takes several positive customer experiences to make up for one negative one.


Given that loyal customers make a much easier sell, make good customer service a priority. Examine your current customer service and make the changes that need to be made to ensure that your small business is providing service superior to that of your competitors.



Expand Your Marketing Efforts

Effective marketing is key to increasing your sales, but you don't have to break the bank to promote your business. There are many inexpensive ways to market your products and services, including:

  • Be mobile and have an app
  • Creating and using a promotion kit
  • Sending out promotions with your invoices
  • Joining professional organizations
  • Involving the newspapers in your grand openings, moves, or charity events
  • Giving free workshops or classes related to your products or services
  • Developing business partnerships and doing cross-promotion with complementary businesses
  • Cold calling (yes it can still work)
  • Advertising your business on your vehicle with a vehicle wrap

Build Your Online Presence


Creating a professional-looking app can be quick and easy nowadays, and your small business needs to be in the online mobile space. Research from the E-commerce Wiki indicates that 88% of consumers now research purchases online before purchasing in a store.

A simple app that describes who you are, what you do, where to find you and how to contact you should be the bare minimum. Your app should at least contain:

  • Your logo and business name
  • All your contact information details
  • Your address, including a Google Maps link
  • A summary of what you do— Your mission, e.g. "We make the best pizza in town... etc."
  • Your product and service descriptions
  • Testimonials from customers
  • Social media links

Go Mobile

If you do nothing else this year, you need to make sure that your business is mobile.

Increasing numbers of people are surfing and searching with their phones—even when they’re at home.


But there are two other trends that could benefit your small business.

The first is mobile marketing. There are many mobile strategies that you could be using to reach your target market with great effect, from push notification messaging to mobile display advertising to having your own business app designed.


Second, having a mobile payment system represents your other opportunity. Apple Pay, Google Wallet, Samsung Pay, Venmo, Square, Intuit GoPayment, Paypal—the choices for paying via mobile are now endless. Offering mobile payment services is a significant convenience to customers, but your small business could be a considerable savings from being able to use a ​mobile POS system.



Build Word of Mouth for Your Business

Most consumers turn to their local network when searching for a product or business before deciding where to shop, so building a good reputation is vital to the success of your business.


How do you get positive word of mouth? By providing good, professional service, building and monitoring your local (and online) reputation, and gaining publicity by giving back to your community through your support and sponsorship of local organizations and charities.



Update Your Business Plan

You did make a business plan before starting your business?

A business plan is vital for startup businesses for many reasons, including testing the viability of your business idea and securing debt or equity financing.


If you haven't made one, it's not too late. Successful, established businesses update their business plan annually to review accomplishments (or lack thereof) and decide on new goals or directions. 


The financial health of your business is summarised by the income statement, the cash flow projection, and the balance sheet, which are contained in the financial section of the business plan. From there you can determine ways to make your business more profitable by increasing sales, reducing losses, or cutting expenses.

If you want your business to be more successful, you need a plan for how to get there.