Patrons Choose Small Businesses for Better Service, Lower Prices, Survey Finds

A survey by online marketer WebVisible finds many consumers prefer conducting business with smaller, local companies due to lower prices, better quality of goods and the more personal nature of service.

The term "Main Street" has become code for all that is right in America - especially in an election year - but it is a nebulous term when used to describe the economics of smaller, local businesses that make consumers spend their money there instead of a larger chain. A survey by local online marketing specialist WebVisibile found more than four out of five consumers - 83 percent - choose to patronize a small, local independent business over a larger chain, and their top three reasons for doing so speak to values that have long characterized small business.

Support for the community, convenient location and more personalized service were the top three reasons consumers shop with small to medium-size businesses (SMBs), the survey found: Just 17 percent of American consumers say they don't choose to patronize a small business over a larger chain. The survey was conducted April 28-30 to help kick off National Small Business Week, which begins May 23. In conjunction with Chicago market researcher Synovate eNation, WebVisible asked 1,000 Americans what makes them choose to patronize a small, local, independent business over a larger chain. Respondents were asked to rank seven possible reasons in order of importance.
Direct access to decision-makers within the company, higher quality of products and services and a closer relationship with an owner or employee also ranked highly. While the common perception is often that smaller, independent businesses can't compete with big box retailers on price, the survey found some consumers don't share that view. One in four overall said "lower price" was among their top three reasons for patronizing a smaller business over a larger chain.
The survey also found perceptions on price varied by income and age. Those with lower incomes were more likely to give local merchants credit for lower prices - 34 percent of those with incomes under $25,000 placed price among their top three reasons, compared with 20 percent of those earning $75,000 or more and 25 percent overall. The percentage placing price in the top three diminishes as incomes increase.
"While conventional wisdom would say that price should matter most in a recovering economy, it turns out Americans still make purchase decisions based on service, convenience and supporting their communities," said Kirsten Mangers, WebVisible's CEO. "That's great news for local merchants. As we celebrate Small Business Week, it's helpful to get a sense of what it is that people love about their neighborhood businesses. If you know what brings people in the door, it's easier to communicate those values in your advertising and marketing to keep those customers coming back."