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Shop Local

Eat Local

Play Local

Keeping Business Local

 

   

 

 

 

 

 

 

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I.  Thriving  Local  Business  Districts  Keep  Local  Economies  Humming  

 

The  Challenges  Facing  Independent  Businesses  

Being  a  local  business  has  never  been  more  difficult,  or  more  rewarding.    Local  businesses  face  a  myriad  of  challenges,  most  of  which  are  out  of  their  control.    According  to  the  2014  Institute  for  Local  Self-­‐Reliance  Independent  Business  Survey,  respondents  found  "competition  from  large  internet  companies"  to  be  their  number  one  challenge,  with  69%  of  the  retailers  in  the  survey  ranking  it  as  a  very  or  significant  challenge.  Greater  than  three  quarters  of  respondents  cited  the  fact  that  online  retailers  are  not  required  to  pay  sales  tax  as  having  a  significant  impact  on  their  business.      Additional  concerns  included  supplier  pricing  favoring  big  competitors;  the  high  cost  of  health  insurance  and  the  lack  of  funds  to  adequately  market  their  business.1  

Shop  Local  Campaigns  Drive  New  Business  to  Local  Merchants  

To  address  this  challenge,  many  communities  have  initiated  Shop  Local  or  Local  First  campaigns  to  attract  new  customers.  The  American  Independent  Business  Alliance  (AMIBA)  and  Institute  for  Local  Self  Reliance  found  that  independent  businesses  located  in  areas  with  Local  First  campaigns  outperformed  those  in  cities  without  such  a  campaign.2  

 

 

 

• According  to  the  survey,  independent  retailers  in  cities  with  an  ongoing  Local  First  campaign  saw  a  1.6%  increase  in  holiday  sales  in  2013  vs.  1.2  %  for  cities  without  such  a  campaign.  

• Of  the  businesses  surveyed,  59%  claimed  the  Local  First  campaign  brought  in  new  customers  to  their  business,  while  58%  said  it  improved  the  loyalty  of  existing  customers  and  50%  said  it  increased  overall  customer  traffic  in  their  business  district.    

National  campaigns  such  as  American  Express's  Small  Business  Saturday  and  the  Buy  Local  Twitter  challenge  also  help  to  raise  the  awareness  of  shopping  locally.  

7.2   8.6  7  

2.6   3.4   2.3  

2011   2012   2013  

Year  to  Year  %  Increase  in  Sales  among  independent  business  with  a  Local  First  Campaign  

Communities  with  a  Local  First  Program  Comunities  witout  a  Local  First  Program  

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Top  Ten  Reasons  to  Think  Local,  Buy  Local,  Be  Local  

1. Money  spent  locally  stays  local:    When  you  buy  from  locally  owned  businesses  significantly  more  of  your  money  stays  in  your  local  economy.    

2. Support  community  groups:  Non-­‐profits  receive  an  average  250%  more  support  from  small  business  owners  than  they  do  from  large  businesses.    Large  firms  often  contribute  to  the  area  where  the  corporation  is  headquartered,  not  necessarily,  where  they  do  business.    

3. Local  character:    The  local  one-­‐of-­‐a-­‐kind  businesses  where  you  live  eat  and  have  fun  are  a  major  part  of  your  local  community's  character  and  identity.    

4. Reduce  environmental  impact:  Locally  owned  businesses  are  often  located  in  a  downtown  or  city  center.    This  means  less  development  on  the  fringes,  contributing  less  to  sprawl,  energy  use  and  pollution.    Additionally,  local  businesses  source  more  of  their  purchases  locally,  meaning  less  transportation  of  goods  and  more  dollars  staying  in  the  local  economy.    

5. Create  more  good  jobs:  Local  merchants  are  the  largest  employer  nationally  and  in  communities,  providing  good  opportunities  for  residents.    

6. Better  service:  Local  merchants  take  time  to  know  their  customers,  and  often  have  a  better  understanding  of  the  products  they  are  selling.    

7. Invest  in  the  future:    Local  businesses,  often  owned  by  local  residents,  are  more  invested  in  the  community's  future,  and  less  likely  to  leave.    

8. Put  your  taxes  to  good  use:    Businesses  in  town  centers  or  downtowns  generally  require  less  investment  in  infrastructure  and  make  better  use  of  public  services  as  compared  to  nationally  owned  stores.    

9. Products  geared  toward  residents:    Local  merchants  are  more  in  tune  with  their  communities  and  customer  base,  leading  to  a  product  offering  best  suited  to  the  local  environment.    

10.   Attract  the  innovators:    In  an  increasingly  standardized  world,  it  is  not  surprising  that  highly  skilled  thought  workers  and  entrepreneurs  prefer  to  settle  and  invest  in  communities  with  unique  character  and  a  distinctive  environment.        

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Who’s  Going  Local?  

In  2008,  Clinton  County,  OH  was  in  a  world  of  hurt.    Its  largest  employer,  DHL,  closed  its  facility  at  the  former  Clinton  County  Air  Force  Base  eliminating  over  

8,000  local  jobs  just  as  the  full  impact  of  the  national  financial  crisis  was  becoming  known.    By  2010,  unemployment  in  Clinton  County  had  gone  from  3%  to  over  19%.    During  this  time,  two  young  local  residents,  Mark  Rembert  and  Taylor  Stuckert,  returned  from  college  determined  to  make  a  difference.    They  founded  a  nonprofit,  Energize  Clinton  County  (ECC),  and  began  working  with  the  local  County  Regional  Planning  Commission.    They  determined  the  best  use  of  their  skills  would  be  to  help  support  local  small  businesses,  and  established  Buy  Local  First  Clinton  County.  

Initial  efforts  included  monthly  coffee  meetings  to  build  relationships  among  local  businesses,  developing  a  web  site  and  email  database.    Consumers  received  weekly  emails  highlighting  local  events,  included  specials/coupons  and  presented  "focal  locals"  which  spotlighted  a  local  business.    The  focal  local  pieces  were  produced  in  collaboration  with  the  local  school  district  and  newspaper.  They  conducted  a  social  media  campaign  that  included  videos  allowing  business  owners  to  tell  their  own  story.3  

At  end  of  2011,  there  were  300  businesses  and  3,695  consumers  participating.  By  the  end  of  2013,  the  consumer  database  exceeded  5,000  names.    In  2012,  they  collaborated  with  JP  Morgan  Chase's  Technology  for  Social  Good  program  to  explore  the  economic  impact  of  their  buy  local  campaign.    That  study  determined  that  businesses  participating  in  the  Buy  Local  First  Clinton  County  campaign  saw  an  approximate  10%  sales  lift  over  those  that  did  not4.      Further,  the  study  found  that  one  Buy  Local  First  event  during  the  holiday  season  generated  a  local  economic  impact  of  $150,000.  

 

Austin  Independent  Business  Alliance,  founded  in  2002  and  is  now  comprised  of  over  800  businesses  spread  across  eight  independent  shopping  districts.    They  provide  members  with  shop  local  marketing  materials,  sponsor  regular  shopping  events  such  as  

"Summer  of  Independents"  and  "Local  Business  Month".  They  also  provide  directories,  an  organization  Facebook  page  and  Tweet  about  member  activities.    They  also  organize  marketing  activities  for  each  district,  promote  independent  businesses  to  tourists,  host  cultural  events  and  more.      

This  alliance  has  successfully  shifted  the  local  mindset  from  chain  shopping  to  taking  pride  in  shopping  with  Austin's  merchants.    

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According  to  the  Local  First  Utah  website,  their  goal  was  "to  recognize  the  value  and  vitality  of  locally  owned  independent  businesses  to  our  communities  and  our  economy".      When  Betsy  Burton,  a  co-­‐owner  of  The  King's  English  Bookshop  in  Salt  Lake  City  first  started  talking  about  buying  local,  "people  thought  we  were  a  bunch  of  whiny  little  businesses.  Now  they  see  the  devastation  that's  been  wreaked  not  just  by  the  chains,  but  by  the  Internet  -­‐-­‐  which  is  far  more  lethal".5    Local  First  Utah  now  serves  five  communities  within  Utah,  providing  them  with  coordinated  

campaigns,  campaign  materials  and  support.    According  to  a  study  conducted  in  2013  by  Civic  Economics,  the  American  Booksellers  Association  and  Local  First  Utah,  55.3%  of  revenue  from  locally  owned  businesses  goes  back  to  the  local  economy,  versus  13.6%  from  national  chains.  

 

Local  First  West  Michigan  was  one  of  the  original  Local  First  groups,  having  been  founded  with  by  seven  businesses  in  2003.    By  2007,  it  had  grown  to  150  members  and  today  represents  over  700  West  Michigan  businesses.      It  has  become  one  of  the  largest  Local  First  organizations  supporting  and  advocating  for  locally  owned  businesses  in  the  Midwest  and  the  Nation.    As  a  result,  it  participates  in  an  advisory  capacity  on  many  of  the  area's  economic  development  initiatives.    It  currently  employees  a  full  time  executive  director,  a  full  time  membership  coordinator  and  a  part  time  program  coordinator.    They  present  shopping  and  community  based  events  as  well  as  specific  business  related  programming  for  their  members.  Member  benefits  include  branding  materials,  listing  in  membership  directories,  networking  events  and,  “Local  First”  events  such  as  annual  street  parties,  the  Annual  Meeting,  LocoMotion  Awards,  the  Sustainable  Business  Conference,  and  the  annual  holiday  campaign  with  heavy  promotion  and  unique  POS  materials.  

According  to  the  Local  First  West  Michigan  Website,  a  2008  study  by  the  research  firm  Civic  Economics,  out  of  every  $100  spent  at  a  local  West  Michigan  business,  $73  stays  in  the  community.  In  contrast,  only  $43  out  of  every  $100  spent  at  a  non-­‐locally  owned  business  remains  in  the  community.  

 

All  of  these  towns  or  counties  designed  their  campaigns  taking  into  account  the  specific  opportunities  and  challenges  presented  by  their  local  environment.      Another  example  is  the  town  of  Danville  CA.  They  took  an  already  successful  local  program  and  enhanced  it  by  adding  a  Town  Card.  

   

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Another  Approach  to  Encourage  the  Local  Economy:  

Danville  California  CA  

A  Case  Study  

Danville  California  is  a  small  town,  loaded  with  character  and  charm,  about  30  miles  east  of  San  Francisco.    Danville's  historic  downtown  is  home  to  a  variety  of  one-­‐of-­‐a-­‐kind  shops,  galleries  and  restaurants  and  is  a  great  place  to  spend  a  day.    The  success  of  Danville's  downtown  shopping  district  is  the  result  of  efforts  on  the  part  of  the  Town  of  Danville,  the  local  Chamber  of  Commerce  and  the  Discover  Danville  Association,  or  the  DDA.    

The  DDA,  a  501c(6)  non-­‐profit,  is  a  collective  group  of  businesses  that  "seek  to  improve  the  economic  vibrancy,  town  centricity  and  tourism  while  maintaining  the  village  atmosphere."    It  was  established  to  counter  regional  competition  for  residents'  time  and  attention,  which  was  pulling  them  away  from  Danville  as  a  shopping  and  recreation  destination.    The  DDA  sponsors  events  such  as  "Discover  Danville  Thursday  Nights",  the  "Pirate  Quest  Treasure  Map,"  the  "Wild  Wild  West  Street  Fest",  Wine  Strolls  and  numerous  other  events  throughout  the  year.    They  also  work  on  town  branding,  advertising,  and  marketing  plans.    

 

The  Chamber  of  Commerce  addresses  the  needs  of  both  merchants  and  non-­‐merchant  businesses.    It  hosts  monthly  networking  events,  events  for  the  residents  such  as  Summer  Fest  and  an  annual  Business  and  Culinary  showcase.    The  Chamber  is  credited  with  integrating  local  businesses  into  this  event.    The  Chamber  covers  Town  ribbon  cuttings  and  the  promotion  of  new  members  in  the  area.  

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The  Town  of  Danville  staff  took  on  the  task  of  creating  a  town  gift  card.    After  several  years  of  research,  the  town  staff,  the  Economic  Development  Manager  and  the  Community  Development  Director  settled  on  Yiftee,  a  Menlo  Park  company,  to  power  the  Danville  Gift  Pass.    Yiftee  was  selected  because  there  were  no  development  or  administrative  fees  (unlike  a  plastic  card),  no  equipment  costs  for  the  merchants,  and  Yiftee  handled  program  administration.      

They  presented  it  to  the  Town  Council,  received  the  go  ahead  and  set  to  work.    Six  weeks  later,  they  launched  the  Danville  Gift  Pass.  

During  the  6  weeks  they:  

• Created  Merchant  Sell  Sheets  to  help  merchants  understand  the  program.  • Designed  merchant  marketing  collateral  including  window  clings,  standard  and  co-­‐branded  tent  

cards,  and  consumer  ads.    • Created  collateral  that  is  given  out  by  merchants,  and  placed  at  the  community  centers,  the  

Farmers'  Market,  the  Visitor  Center  and  other  venues.  • Together  with  Yiftee,  developed  the  Danville  Town  Gift  Pass  landing  page  yiftee.com/Danville  • Signed  up  over  50  Merchants  for  the  program.    • Defined  a  marketing  rollout  plan.  

The  launch  was  straightforward;  designed  to  raise  awareness  of  the  new  Danville  Gift  Pass.    Elements  included:  

• Press  releases  by  both  the  Town  of  Danville  and  Yiftee.  

• Press  interviews  by  members  of  the  Town  and  Yiftee  staff.  

• Information  incorporated  in  PTA  letters  to  parents.  

• A  Yahoo  ad  and  email  campaign.  • Banner  Ads  on  the  local  town  newspaper  

website.  • An  advertorial  in  a  local  paper,  which  covers  

several  regional  cities.  • A  two  page  spread  in  a  local  book  published  

for  local  homes  and  hotels  • Links  to  the  landing  page  from  town  

websites.  

 

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Together,  the  Town  of  Danville  and  Yiftee  designed  an  easy  to  navigate  web  page  for  residents  and  merchants  to  use.    On  the  Danville  merchant  page,  merchants  can  customize  their  listing  and  image  related  to  their  business.  

 

 

 

 

   

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II.  Tips  for  Creating  a  Shop  Local  Campaign  

Getting  Started  

The  best  place  to  start  is  with  other  local  business  owners,  the  local  Chamber  of  Commerce,  Town  Council  or  local  merchant  association.    See  if  you  can  identify  a  group  of  local  merchants  who  would  be  interested  in  forming  a  steering  committee.  Review  the  map  of  local  alliances  on  the  American  Independent  Business  Association  (AMIBA)  web  site:  

http://www.amiba.net/about_ibas/find-­‐iba.      

You  may  find  an  already  established  local  group  that  you  can  join.    

Once  you  have  established  a  core  group,  get  agreement  on  the  vision,  goals  and  message  of  your  organization.      Choose  a  name  for  your  organization,  a  logo,  and  a  slogan.  Consider  asking  local  designers  if  they  might  volunteer  their  services  in  exchange  for  a  free  membership  or  promotional  credit.  Finally,  create  a  pitch  that  spells  out  your  vision  and  make  sure  everyone  in  your  core  group  can  deliver  the  message.        

 

Your  group's  name  should  be  positive,  proactive  and  mention  you  are  local.    For  example,  oakland  grown  (Oakland  CA)  or  Homegrown  El  Paso  (El  Paso,  TX)      

Logos  can  incorporate  local  landmarks  or  other  important  features  of  your  community.        

Slogans  should  incorporate  a  call  to  action  "Think  Local,  Be  Local,  Buy  Local  or  "Local  

Spoken  Here"  or  BUoY  LOCAL."    

If  possible,  create  a  template  of  a  sample  flyer  or  brochure.  Review  the  materials  on  both  the  AMIBA  web  site  http://www.amiba.net/,  and  the  BALLE  (Business  Alliance  for  Local  Living  Economies)  site  https://bealocalist.org/  for  templates  that  you  can  customize  for  your  campaign.      

When  you  have  reached  this  stage,  it  is  time  to  arrange  a  meeting  with  the  greater  independent  business  community.      

Your  goal  is  to  promote  your  vision  and  bring  more  businesses  on  board  to  join  in.    So  create  an  event,  invite  the  local  merchants,  present  your  plan,  get  their  feedback  and  see  if  you  can  get  a  critical  mass  to  help  create  the  campaign.  

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Develop  a  Basic  Campaign  Kit  

Once  the  organization  is  created  and  membership  is  committed  to  the  campaign  and  the  mission,  creation  of  marketing  materials  begins.  These  are  the  materials  that  businesses  will  receive  with  they  join.    This  can  include  a  welcome  letter,  window  cling  for  their  storefront,  counter  top  tent  card,  tips  for  promoting  the  campaign,  flyers  to  distribute  to  customers  explaining  the  campaign,  a  list  of  participating  businesses  and  a  poster.  You  should  also  create  a  basic  website  where  merchants  can  download  logos,  sample  text  and  marketing  materials.  The  web  site  should  list  participating  merchants.    Plan  to  charge  new  members  $20-­‐$50  dollars  for  startup  materials.  

 

Town  Gift  Cards  a  Powerful  Tool  for  Shop  Local  Campaigns  

 Town  gift  cards  can  provide  both  an  anchor  and  a  focal  point  for  shop  local  campaigns.    A  town  gift  card  is  a  physical  or  virtual  card  that  is  at  participating  members  in  a  specific  area.    The  advantages  of  a  town  gift  card  are  numerous  as  they:  

• Deliver  new  customers  from  gift  givers  who  like  your  town,  and  want  to  treat  their  friends  or  loved  ones  to  a  new  experience,  product  or  store  offered  in  town.    

•  Provide  merchants  the  ability  to  participate  in  the  $110B  gift  card  market.  •  Are  a  convenient  way  for  real  estate  agents  and  other  local  business  professionals  to  promote  their  

community  when  gifting  new  residents  or  clients.  •  Raise  the  visibility  of  the  local  merchant  base  over  the  online  and  big  box  stores.  •  Reduce  retail  sales  leakage.  •  Are  a  powerful  marketing  and  branding  asset,  defining  the  local  circle  of  merchants  as  one  

community,  one  brand.    • Boost  sales,  especially  during  the  post-­‐holiday  slump.    Gift  cards  bring  people  back  into  stores  to  

shop  in  the  post-­‐holiday  season  when  retailers  or  still  trying  to  move  overstocked  inventory.    Even  if  consumers  are  feeling  that  their  own  wallets  are  stretched  thin,  they  can  spend  gift  card  guilt  free,  often  spending  a  bit  more  then  the  value  of  the  card.  

•  Help  make  the  downtown  a  shopping  destination  and  inspire  residents  to  shop  local.  

Additionally,  

• Shoppers  with  gift  cards  are  2.5  times  more  likely  to  pay  full  price  with  a  gift  card6,  increasing  retailer's  profits.  

• Gift  card  users  generally  spend  over  the  face  value  of  the  gift  card,  as  purchases  rarely  come  out  to  the  exact  face  value  of  the  card.    For  example,  research  shows  that  the  bulk  of  purchasers  who  walk  in  with  a  $50  gift  card  will  spend  about  20%  more,  or  an  additional  $107.  

 

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Town  gift  cards  function  like  most  other  gift  cards.    Purchasers  load  a  dollar  amount  onto  the  card,  which  can  then  be  redeemed  at  participating  merchants.    The  group  managing  your  buy  local  campaign  controls  which  merchants  are  included  in  the  program,  ensuring  that  only  local  businesses  are  included.  

 Participating  members  are  also  reflected  on  a  web  site  linked  to  the  town  card.    Reporting  functions  linked  to  redemption  of  town  cards  can  help  merchants  and  the  town  associations  track  the  effectiveness  of  shop  local  promotional  efforts.    

 

Mobile  Gift  Cards:  the  Leading  Edge  of  Gift  Card  Options  

To  date,  plastic  cards  have  dominated  the  gift  card  option.    These  types  of  cards  have  become  less  popular  with  customers  due  to  many  disadvantages.    These  include  the  fact  that  customers  must  track  their  balances  and  expiration  dates,  remember  which  drawer  they  left  them  in  and  to  grab  them  before  heading  out  to  go  shopping.      

As  a  result,  these  cards  are  giving  way  to  more  convenient  mobile  gift  cards.    The  advantages  of  mobile  gift  cards  are  numerous:  

• They  can  be  stored  and  accessed  on  a  smartphone  or  tablet.    •  Mobile  gift  cards  give  the  consumer  convenient  anytime/anywhere  access  without  having  to  keep  

track  of  the  physical  cards.    • Mobile  gift  cards  give  consumers  an  option  when  then  need  to  give  a  gift  now  -­‐-­‐  during  the  holiday  

season,  to  show  appreciation  to  a  client  in  another  city  or  for  a  celebration  that  may  have  been  forgotten  until  the  last  minute,  such  as  a  sibling's  birthday,  tomorrow,  in  another  state.  

•  Mobile  gift  cards  provide  the  consumer  with  greater  security.    Since  the  card  is  stored  in  the  cloud,  there  is  no  risk  of  losing  them  or  having  them  stolen.    

•  For  the  merchant,  redeeming  mobile  gift  cards  is  easy.  They  are  a  manual  POS  entry,  the  same  procedure  used  for  a  phone  order  or  bad  swipe.  

According  to  an  Aberdeen  Group  study,  61%  of  retailers  plan  to  adopt  mobile  gift  cards,  twice  as  many  as  those  planning  to  adopt  plastic  or  physical  gift  cards.8  Retailers  already  using  them  include  Starbucks,  Target,  American  Eagle,  Best  Buy,  Walmart  and  Home  Depot.  

   

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Putting  It  All  Together  

Once  you  have  your  organization,  signed  up  merchants,  created  your  marketing  collateral  and  town  gift  card,  it  is  time  to  launch.  Launch  activities  can  include  press  releases,  press  conferences,  presentations  at  local  merchant  association  meetings,  notification  in  the  school  newspaper,  information  sheets  to  local  sports  organizations  and  articles  or  ads  in  local  newspapers  or  on  local  websites.    

To  persuade  residents  to  shop  local,  define  specific  weeks  or  events  where  you  are  going  to  encourage  residents  to  shop  locally.    These  could  be  events  such  as  "Downtown  Days",  "Celebrate  your  Independence  -­‐-­‐Shop  Locally  Owned  Independents'  Week",  "Back  to  School  Days"  or  "Buy  Local  Week"  before  the  holidays.    Try  a  "Shop  Local  Challenge"  encouraging  residents  to  see  how  many  local  businesses  they  can  support  in  a  month  with  gift  card  rewards  to  the  top  shopper.  Partner  with  other  downtown  events  that  are  already  happening  such  as  art  festivals  and  farmers'  markets.    Make  sure  to  leverage  national  events  such  as  Independents  Week,  the  first  week  of  July  (AMIBA.net/indieweek),  Small  Business  Saturday,  the  Saturday  after  Thanksgiving  (www.shopsmall.com)  and  Shift  your  Shopping  campaigns  (ShiftYourShopping.org).  

 

   

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III.  Conclusion    

There  has  never  been  a  more  difficult  or  rewarding  time  to  be  a  local  business.  While  big  box  merchants  and  Internet  vendors  continue  to  challenge  local  merchants  for  the  sale,  cities  and  towns  are  devising  sophisticated  ways  to  stand  out  and  fight  back.    These  include  Shop  Local,  Buy  Local  or  Local  First  campaigns  and  events,  leveraging  national  programs  such  as  Small  Business  Saturday,  and  adopting  revolutionary  tools  such  as  town  gift  passes  to  give  the  local  community  a  strong  brand  presence  while  keeping  the  money  circulating  within  the  local  community.    

 

 

 

 

 

 

 

 

 

                                                                                                                         1  Stacy  Mitchell,  2014  Independent  Business  Survey.  AIB  Advocates  for  Independent  Business  &  ILSR  Institute  for  Local  Self-­‐Reliance,  pages  3,9  2  Ibid  3  Sophie  Quinton.  "How  to  Design  a  'Buy  Local'  Campaign  That  Actually  Works",  The  Atlantic  Citylab,  April  25,  2013  4  Christian  Schock,  Taylor  Stuckert,  Mark  Rembert,  Dr.  Peter  J.  Mallow.  "Growing  Forward:  In  Response  to  An  Economic  Disaster",  The  IEDC  Economic  Development  Journal,  Winter  2014  5  Julia  Lyon.  March  28,  2014.  "  'Buy  Local'  Campaigns  can  Actually  Supercharge  Sales"  blog  post  @CNN  Money  http://money.cnn.com/2014/4/03/28/smallbusiness/buy-­‐local/index.html