The COVID-19 pandemic dealt a curveball to local and small businesses across Canada. Most had to contend with the unexpected, and often on barely a moment’s notice. Over the past year we’ve seen stories of pivots and adaptations, and sometimes entirely new business models that sprung up on the fly.
With any luck the next chapter will prove easier. One thing that can give us hope: Canadian consumers want to pitch in by supporting their local and small businesses.
A new consumer behaviour survey from Interac affirms that Canadians are eager to bolster their local economies by spending at businesses in their own backyards.
Some key findings? Three-quarters of respondents (75 per cent) said the pandemic has made shopping and supporting businesses in their community more important, and 78 per cent agree that local businesses are more important to local communities than retailers that exclusively do business online.
That strong support comes with conditions. Customers demand choice in digital payments, and the convenience that an omnichannel checkout experience delivers. More on that in a moment.
Consumer behaviour and attitudes favour local and small businesses
The vast majority (89 per cent) of the 1,000 Canadian adults who took part in the Interac survey say they understand that COVID-19 was a blow to local businesses.
That empahty could translate into a shift in consumer behaviour. More than half of Canadians (55 per cent) say their desire to spend money at local businesses incentivizing them to shift their spending habits by shopping closer to home.
Canadians say this desire is about more than just convenience. Half of survey respondents said they’d be willing to pay a local retailer $5 more for the same product as an online one — and 31 per cent would pay $10 more. Canadians are more patient with local retailers, too. Almost half (48 per cent) agree they’re willing to wait longer for products from a local business.
But after the difficulties brought on by the pandemic subside, will Canadian consumers continue to make local spending such a big part of their lives? That depends.
Consumers expect the convenience of an omnichannel checkout
Canadian consumer behaviour trending in the direction of shopping locally may sound great, but there’s a catch. Consumers expect the convenience and ease of faster digital payments. They told us this directly: Two-thirds said businesses that fail to adopt digital payment solutions will struggle in the times ahead.
Canadians want to support their local and small businesses, but they also expect them to create a seamless checkout that offers their digital payment method of choice. Interac Debit, notably, is an essential payment option for many Canadians, and 72 per cent believe consumers should have the option of using debit to pay when checking out online.
Debit continues to grow in popularity. It’s becoming the go-to payment choice for a growing number of consumers for online transactions. We see this in Interac data, for example in the 333 per cent increase in Interac Debit for e-Commerce payments since the start of the pandemic, and a 113 per cent year-over-year increase in the volume of Interac e-Transfer transactions received by businesses.
As e-commerce becomes more important for local purchases and consumer behaviour continues its rapid evolution, businesses of all sizes that invest in accepting debit are investing in their ability to adapt and thrive. As William Keliehor, Chief Commercial Officer, Interac observes, “Businesses need solutions to prioritize seamless integration of payment options across the consumer’s shopping journey, whether online, in-app or in-store. Businesses that support these changes now will be better positioned in the future.”
Small business payments toolkit to keep spending local
In other words, offering consumers a choice in digital payments is important today, and it’s only going to become more important tomorrow. Retailers are coming to understand that when it comes to payments, the customer is the channel, and an omnichannel checkout experience is one that meets customers where they are.
Interac can offer digital payment tools that will help small businesses serve local customers in all sorts of ways.
As ever, Interac Debit for contactless payments offers a fast and easy way to check out, in store or curbside. Offer Interac Debit for e-Commerce as well, and you can serve customers going online or in-app to order local pickup or delivery.
If you’re a small business that’s accustomed to accepting cheques or cash for deposits or payments, consider leveraging Interac e-Transfer for payments instead. More than half of Canadians (52 per cent) say they’re just as comfortable paying with Interac e-Transfer as by other payment methods, and during the pandemic they’ve been using it in new and different ways. Eighteen per cent of Canadians said they’ve used Interac e-Transfer for purchases from local businesses, 19 per cent have used it for takeout, and 14 per cent to pay a tradesperson.
Finally, for moments when your customers are on the move — from farmers’ markets to pop-ups — there are solutions that allow you to use your mobile device to complete point-of-sale transactions.
These are the events that bring communities together, and we anticipate they’ll be an important part of the economic rebound. As Keliehor says, “when spending returns to pre-pandemic levels, ensuring local businesses can serve customers safely with digital solutions will be an important part of the economic recovery.”
Small businesses are gearing up to capture the loyalty of local customers after the pandemic. It’s our job at Interac to ensure they have the digital, mobile, and e-commerce payment tools they need to make those local relationships even stronger.