68% of Main Street SMBs Leveraging Social Media See Increasing Revenues
Since April 2021, most Main Street small to mid-sized businesses (SMBs) in the U.S. have been experiencing significant growth.
In fact — according to PYMNTS Intelligence’s latest SMB Growth Monitor Report, “Main Street Small Business Growth Exceeds GDP for First Time in Two Years — growth in 2023 was so strong it reversed a two-year trend in which Main Street SMB growth trailed nominal GDP growth.
In 2021, the nominal GDP growth was 12% — nearly three times the 3.2% growth rate these SMBs reported. And although nominal GDP growth dropped the following year to 7.1%, it still outpaced the 5.5% growth rate Main Street SMBs reported in 2022.
The growth Main Street SMBs saw last year was especially evident in those businesses operating in the hospitality sector. Thanks in a large part to consumers embracing a post-pandemic peace of mind, hospitality-focused SMBs saw revenues climb by 11% in 2023.
And although no other Main Street SMB doing business in other sectors could match the earnings that hospitality businesses reported, PYMNTS Intelligence did note that many Main Street SMBs saw improved earnings by investing in innovation.
For instance, those SMBs that broadened the types of payments they accepted (both in-store and online) did better than those with narrower payment options. Those Main Street SMBs reporting growth in 2023 accepted an average of 6.4 payment types, while those reporting decreasing revenues last year accept 4.7 payment types.
Similarly, those Main Street SMBs that provide customers with access to more sales channels also appear to be the ones who are seeing increasing revenues.
Simply put, by offering consumers more ways to close deals, businesses are giving them more ways to spend their money. Those Main Street SMBs that enable shopping via websites and social media channels (in addition to their in-person retail locations), report seeing increasing revenues as a result. Those efforts to diversify their sales to include online shopping are paying off: Since January 2023, online sales account for 55% of Main Street SMBs’ sales.
As the chart illustrates, Main Street SMBs with increasing revenues are more likely to sell their products online than those businesses with decreasing revenues. Businesses with growing revenues are more likely to reach their customers via social media (68%), mobile apps (27%) and websites (60%) than businesses with stagnating or decreasing revenues.
As social media selling is prominent among SMBs with increasing revenue, it seems that some Main Street SMBs are innovating to catch those customers who are perpetually online — and finding success.
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