eCommerce Poses Threats To SMBs

Competing in the e-Commerce space can be tough enough for big retailers, leaving it that much tougher for the small, local stores to get their voices heard and products seen online.

High costs of technology investments and lack of employees have left many small businesses without viable websites, and sometimes no website at all. But this lack of digital savviness also translates into small businesses social media marketing, which trickles down to capturing a large customer base. Heavily reliant on word of mouth and foot traffic to their local storefronts, small businesses must focus on capturing the audience who appreciates what brick and mortar shops have to offer.

But that doesn't mean small businesses can ignore the power of e-Commerce in attracting customers, both online and in store.

"If a small entity doesn't have a website, it's as if they are not real," John Talbott, an Indiana University business professor, said in an interview. "It's almost more important than a storefront these days."

Lack of resources, lack of time, and lack of knowledge in how to bring a brick and mortar shop online is a struggle for many small business owners. Once they're done balancing books, paying employees and managing their storefronts, there's not much time or money to do much else. But what some shop owners don't realize is that not having a compelling website may prevent people from stepping foot in the store, too, since many people look online to find what shops to actually visit.

Beth Caroll, the creator of — a website that connects consumers to local, independent small shops — and instructor of entrepreneurship at Purdue said it's important small retailers realize the power of investing online. Caroll has 700 businesses nationwide listed on her site, but a majority of those don't have websites. 75 percent have Facebook pages, but only 40 percent have a website.

"That's not good," Carroll said. "We need to up that number, but that's another investment they have to make. … I think that's why a lot of them don't do it."

Etsy has given new life to many small businesses owners and artists who otherwise wouldn't have much of  a venue to sell their products, but that's not enough to make a mark in the e-Commerce space for small businesses. And while more businesses — both big and small — are focusing efforts on e-Commerce, there's also a segment trying to bring their online businesses into stores. That's an entirely different challenge.



The September 2020 Leveraging The Digital Banking Shift Study, PYMNTS examines consumers’ growing use of online and mobile tools to open and manage accounts as well as the factors that are paramount in building and maintaining trust in the current economic environment. The report is based on a survey of nearly 2,200 account-holding U.S. consumers.