With the holiday season fast approaching, Canadian small businesses are feeling the heat – and it’s not from the festive lights. According to a new study from Constant Contact, inflation is squeezing the wallets of both shop owners and consumers, threatening to turn what’s typically the busiest time of year into a battle for survival.
The Small Business Now report highlights a worrying trend: nine out of ten small businesses across Canada have been hit hard by rising costs. And if that’s not enough, more than half of Canadian shoppers are cutting back their spending at local businesses due to inflation pressures. That’s a lot of holiday cheer lost before the season even begins.
The Pressure is On for Q4
Small businesses are pinning their hopes on the fourth quarter – traditionally the golden goose for sales. With a significant 32% of small businesses saying they feel the most pressure to boost revenue during this time, everyone is hustling to make sure they don’t miss the mark.
Sarah Jordan, the Chief Marketing Officer at Constant Contact, knows what’s at stake. “Small businesses are tough as nails, but they’ve got to act fast and smart this holiday season,” she said. “The good news? Shoppers still want to support local stores, but businesses have to start their holiday marketing early and keep customers engaged all season long.”
Marketing Struggles Could Spell Trouble
Despite the importance of the season, many small businesses are falling short in their marketing efforts. A staggering 72% of small businesses say they’re held back by tight budgets and lack of time, making it harder to put the right strategies in place. What’s more, 59% of those who did market their business last year aren’t even sure if their campaigns worked.
Even worse? Nearly a third didn’t bother with any promotions during the 2023 holiday season, and almost one-quarter didn’t run any holiday marketing at all. With numbers like that, it’s no wonder some businesses are feeling the pinch.
Simple Changes Could Make a Big Difference
The silver lining? Small tweaks can have a big impact. Here’s how Canadian small businesses can make the most of this holiday season:
- Start Early: October is when things really start to heat up. It’s the unofficial start of the holiday season for 18% of businesses, and getting a jump on things early could be the difference between standing out or being forgotten.
- Don’t Reinvent the Wheel: Instead of scrapping entire campaigns, many businesses (43%) find success by giving their existing marketing a holiday makeover. It’s a simple, low-cost way to add festive flair without breaking the bank.
- Discounts Work Wonders: Shoppers love a good deal. With 36% of small businesses reporting that discounts drive revenue, and 61% of consumers saying competitive pricing nudges them to buy, offering a holiday sale might just be the gift that keeps on giving.
- Stay Focused: Last year, businesses said they spread themselves too thin. This year, more than half plan to double down on email and social media marketing – two areas that have proven to get results.
The Final Word
As Canadian tech expert Marc Saltzman puts it, “We Canadians have a soft spot for small businesses – they’re the backbone of our economy. When the holidays roll around, we want to support them as much as we can.” His advice for small businesses? Make small changes that drive traffic, whether it’s trying out new tools or refining last year’s winning strategies.
There’s no doubt this holiday season will be a challenging one for small businesses across Canada, but with the right moves, there’s still plenty of room for success.
To dive deeper into the numbers and learn more about Constant Contact’s findings, check out the full Small Business Now report.