Defending Local
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From disruption
comes transformation
No matter the type of business, social platforms have empowered entrepreneurs to make pivots necessitated by the coronavirus pandemic. At first glance, California-based pregnancy resource center The Cradle Company looks like the kind of operation that’s particularly vulnerable. Pre-pandemic, the majority of its services—including pediatric sleep consultations and lactation counseling—occurred in person. But The Cradle Company’s COVID-19 era adjustment to virtual classes and appointments was an unexpected success. The business’ client base quickly grew from being L.A.-centric to national—and the company even picked up customers abroad.
“We developed a three-hour online workshop, and it contributed to one of our highest-grossing months in the past two years,” says founder Brandi Jordan. “That one class has brought in around $55,000 since the end of June, and it was all done completely online and through posting on Facebook.”
Jordan and The Cradle Company have relied on social platforms extensively through the pandemic. She runs two Facebook Groups focused on providing families with postpartum support, which can translate to new business when one of her approximately 7,000 members reaches out to request services. She has held panel discussions on Facebook Live, providing free education to new parents, and she has even been used by teams from larger companies to speak from their Instagram accounts about topics like sleep and breastfeeding.
ot so long ago, Apotheosis Comics & Lounge in St. Louis, Missouri,
was an epicenter of community activity. In one part of the shop, a
group of veteran role-players were kicking off their weekly gaming session, while kids upstairs enjoyed the same card games their parents once played. In another corner, regulars gathered to compare notes on the week’s new releases.
The place looks different now. Reeling from an 80% revenue drop during the first month of COVID-19 shutdowns, Apotheosis was forced to transform to include an online delivery business—a pivot that meant converting parts of the shop from a warm, community-oriented space into something more like a warehouse. Tables and chairs were moved to the second floor to make room for a delivery staging area. Retail displays were taken down as inventory was alphabetized and owner Martin Casas, with the technical skills of store manager Ivan Wine, built and launched a revamped website. One early conundrum: how to deliver beer and comics in the same bag without condensation ruining the paper.
“We had to change basically every single facet of the business in order to survive, and we had to do it as quickly as possible,” Casas says. “It was ugly at the beginning, but now that we’re six months in, I think we’ve got it figured out a little bit better.”
Social media has been particularly crucial to the store’s survival. Tools like Facebook Live provide an outlet for Apotheosis to connect with the community during quarantines and provide updates about the business. The platform’s audience selection tools allow Casas to reach new customers—for example, by informing parents about the shop’s educational resources—while removing the friction between someone discovering the business and making a purchase. His 10-year-old daughter even joined the effort, creating social videos promoting the shop.
Casas is one of many small business owners who have relied on social media to help weather the impact of COVID-19. He and others are finding that platforms like Facebook and Instagram can play powerful roles when it comes to staying plugged in with customers, reaching new audiences and even delivering on radical, all-or-nothing pivots.
“The tools that Facebook has made available to us are invaluable to our survival. They are what has kept us alive,” Casas says. “We’re just going to keep doing the things that we know work well, and hopefully we can make it to the finish line.”
The broader impact is staggering. According to the U.S. Small Business Administration, small businesses accounted for 1.8 million new jobs in the latest year studied, while 8.7 million small businesses in America are minority owned. These stats demonstrate the power that small businesses yield to drive economic growth and opportunity.
But applications for new businesses’ employer identification numbers (EINs) plummeted in the weeks following the declaration of the public health emergency, and unemployment claims spiked to over 24 million—with some estimates for the U.S. indicating that small businesses have borne the brunt of the job losses.
“Each business has its own individual challenges based on the way it’s structured,” says Carey King, director of Uptown Grand Central, a nonprofit organization that supports small business growth in New York City’s East Harlem neighborhood. “The Paycheck Protection Program can work for some restaurants, but it doesn’t for fitness studios or hair salons because they tend to use independent contractors. So there are financial differences, and then there are cleanliness, sanitation and timeline issues.”
Small businesses in nearly every sector have been wracked by the pandemic. According to a recent survey from the National Academy of Sciences, of those surveyed, the median small business with monthly expenses of more than $10,000 only had around two weeks’ worth of cash on hand. The same research, which surveyed more than 5,800 business owners between March and April, stated that 43% of businesses had temporarily closed due to COVID-19 and reported having reduced active employment since January by an average of 39%.
Small business, big stakes
Source: U.S. Small Business Administration Office of Advocacy, 2019
47.3%
Share of private workforce employed by small businesses
Wall Street Journal Custom Content is a unit of The Wall Street Journal advertising department. The Wall Street Journal news organization was not involved in the creation of this content.
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Faced with an ever-evolving set of challenges, small businesses are deploying digital tools to connect with customers and preserve their entrepreneurial dreams.
30.7 million
Small businesses in the United States
Like Casas in St. Louis, Johnson turned to social media to find new ways of reaching customers. Instead of laying off her retail staff, she transitioned them to work remotely as “brand ambassadors,” promoting Elle Jae Essentials on Facebook and Instagram. Since social media drives 90% of the business’ online traffic, engaging with customers and growing the brand’s following has been crucial to its survival—and ultimately, its success.
Johnson is far from alone in turning to digital tools like social media during this challenging time. According to Facebook's Global State of Small Business Report, commissioned in partnership with the Organisation for Economic Co-operation and Development and the World Bank, approximately one-third of surveyed small business leaders reported earning at least 25% of their sales from digital channels in the last 30 days prior to the survey. Currently, some 200 million businesses use Facebook apps each month.
“We’re actually hiring another round of brand ambassadors next week,” Johnson says. “It’s a transitional period and we’re working through it as best we can, but I’m excited to ramp it up and increase our staff.”
Source: Facebook/OECD/World Bank (2020), The Future of Business Survey, available at: dataforgood.fb.copm/global-state-of-smb
25%+
Sales earned through digital channels in prior 30 days, reported by one-third of small business owners
La’Asia Johnson, founder of the Flint, Michigan-based natural hair and beauty products brand Elle Jae Essentials, has dealt with all of these challenges. She founded her business in 2017 as a personal hobby, making body butters and scrubs without the chemical ingredients that irritated her skin. To her surprise, her revenue rapidly grew from the single digits to six figures, and Elle Jae expanded from a one-woman show to a team of 10 with its own production space. But Johnson took an 80% revenue hit soon after COVID-19 struck Michigan, pushing her to make some hard decisions.
“I’m immunocompromised. I don’t want to risk it and I don’t want to risk my staff becoming infected, so we ultimately made the decision to close our retail location,” Johnson says. “That was a major setback.”
While The Cradle Company’s revenue is still expected to take at least a 50% revenue hit compared to 2019, Jordan’s social media strategy has helped her tap into new sources of growth that might have remained untouched. And even if there’s no replacing the intimacy of working one-on-one with a new mother, her commitment to building community has carried over to virtual offerings.
“In a weird way, COVID pushed me to become more global and open up to a wider opportunity,” she says. “I guess I’m in a ‘good’ business in that people are always going to have babies. But my vision for us is to continue growing—to really engage with people and create trust on a larger scale, even more so than what we were doing in our pre-COVID days.”
N
La’Asia Johnson
Founder of Elle Jae Essentials
KNOTCH SURVEY GOES HERE
The Cradle Company | Pasadena, California
Sources:
1. Luca, Michael, et alia, “The impact of COVID-19 on small business outcomes and expectations,” Proceedings of the National Academy of Sciences of the United States of America, July 28, 2020.
2. “2019 Small Business Profile,” U.S. Small Business Administration Office of Advocacy, 2019.
3. Wilmoth, Daniel, “Small Business Facts: Early Data Show Severe Disruptions,” U.S. Small Business Office of Advocacy, April 2020.
4. “ADP National Employment Report,” ADP Research Institute, March 2020.
5. Facebook/OECD/World Bank (2020), The Future of Business Survey, available at: dataforgood.fb.com/global-state-of-smb
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For Apotheosis Comics & Lounge, social media has been crucial to the store’s pandemic business pivot.
How Flint, Michigan-based Elle Jae Essentials transitioned its retail team to work as digital brand ambassadors during the pandemic.
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"During the pandemic, we've pivoted to do a lot on Facebook. What was important before became even more important as our lifeline to the community, which we had built in person, was kept alive virtually."
Edward Garcia, Owner
NEW YORK | NY
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”Before COVID, I wasn't someone who would put myself out there on video. But I think people like to see me, the person, behind the whole idea. Sometimes I share videos about how I do my sourcing; sometimes people want to speak to you. Using Facebook’s video platform has made communication with my customers better.”
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"During the pandemic, we've pivoted to do a lot on Facebook. What was important before became even more important as our lifeline to the community, which we had built in person, was kept alive virtually."
Edward Garcia, Owner
NEW YORK | NY
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”Before COVID, I wasn't someone who would put myself out there on video. But I think people like to see me, the person, behind the whole idea. Sometimes I share videos about how I do my sourcing; sometimes people want to speak to you. Using Facebook’s video platform has made communication with my customers better.”
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Philadelphia | PA
Queen & Rook Game Cafe
7/7
"During the pandemic, we've pivoted to do a lot on Facebook.What was important before became even more important as our lifeline to the community, which we had built in person, was kept alive virtually."
Edward Garcia, Owner
NEW YORK | NY
Emergency Mobile Thrift Shop
6/7
”Before COVID, I wasn't someone who would put myself out there on video. But I think people like to see me, the person, behind the whole idea. Sometimes I share videos about how I do my sourcing; sometimes people want to speak to you. Using Facebook’s video platform has made communication with my customers better.”
Janet Caraballo, Owner
Oklahoma City | OK
Tio Chuy's Auto Sales
5/7
Highland Park | IL
Embrace Amazing
with Jen Z
4/7
Westmont | IL
Rising Goddess Fitness
3/7
PUEBLO | CO
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Drexel HilL | PA
Tutunyou
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