Unconventionals Podcast | Season 3 Episode 4

Five Years of Small Business Saturday: How American Express and Local Retailers Are Changing Small Business Culture

It seems odd that a large corporation would launch a campaign that’s neither proprietary nor tightly controlled.

So when American Express — a not-so-small business — created Small Business Saturday, they must have envisioned a great opportunity. And with the President and U.S. Senate’s support, in addition to countless Mom & Pops, it’s clear they were on to something.

Join host Mike O’Toole as he chats with several guests including one of the leaders behind Small Business Saturday, Mary Ann Fitzmaurice Reilly. They discuss how the initiative was started and how it has helped small, local shops gain a fair share of the holiday shopping season.

You can also subscribe to The Unconventionals on iTunes and Stitcher. And be sure to join the conversation on Facebook and Twitter as well.

Video Highlights

PODCAST TRANSCRIPT

Speaker 1:
Next, on PJA Radio's The Unconventionals.

Barack Obama:
This is small business Saturday, so we're out here supporting small businesses.

Speaker 3:
What did you buy?

Barack Obama:
It is a long list, but some outstanding books. I've got every age group from 5 until 52. We all set?

Speaker 4:
You are all set.

Barack Obama:
All right.

Speaker 4:
Thank you so much.

Barack Obama:
All right. Okay guys. Have a great holiday.

Mike O'Toole:
I'm Mike O'Toole and this is The Unconventionals. Lots of the stories we tell on The Unconventionals are small stories told at a human scale. Higher Ground Farms is a great example. It's a couple of University of Vermont grads who overcome a lot of obstacles to start their own farm on a rooftop in the city of Boston. We also occasionally get to tell some big stories, and they don't get bigger than small business Saturday. Not many marketing campaigns are promoted publicly by the President of the United States, or are enshrined as an official day. In 2011, the United States senate voted unanimously to declare the Saturday after Thanksgiving "Small business Saturday."


This day, and the associated "Shop Small" initiative have become part of the culture. They impact literally billions of dollars of revenue for tens of thousands of small retailers. How did something this big happen? It was an initiative launched by American Express but all the things you might expect of a corporate campaign, that it's proprietary, that there are strings attached, that it's tightly controlled or there's an explicit commercial interest, none of that is a part of small business Saturday. This was deliberate from the beginning. This is what makes the campaign unique and what has enabled it to become not just a campaign, but a movement.


Our guest today is Mary Ann Fitzmaurice Reilly, the senior Vice President at American Express who led the charge. We'll also be talking to a few small businesses in Austin, Texas, who see the Shop Small movement as their own. Marry Ann led marketing at American Express Open, which is AmEx division to market to small businesses. To start, I asked her if Small Business Saturday was a way of promoting American Express' commercial interest.

Mary Ann:
Well, let me go back to sort of the history of Small Business Saturday, if that would be helpful.

Mike O'Toole:
Sure.

Mary Ann:
Because we have a long history with small business, we do a lot of research, we do a lot of discussion with small businesses so that we're basically tapped into what are their most pressing needs so we can try to address those needs. The mission of American Express Open is to help businesses do more business. In 2010, we did our annual research. We do a survey called the Small Business Monitor to really understand what are small businesses' needs, how are they feeling, what's their optimism. For the first time in 26 years, the number one need was no longer "Help me with my taxes." Suddenly, the number one need coming out of the recession was "Help me get more customers." That really was a light-bulb for us to say "Wow, there's got to be something we can do here."


We have a large consumer base that does a lot of spending across both large and small businesses. We did some research with them as well, and 93% of consumers said they understood that small businesses were the way the economy was going to come back. 93% of them said they wanted to support small businesses in their community. It was really an initiative that we put together in six weeks, which is pretty amazing for a large company.

Mike O'Toole:
You had in 2010 this research came out. We're coming out of the great recession. How does it go from that you have a documented need, in a way, how did it go from that to there's this initiative?

Mary Ann:
Right. The idea really just came about through some brain-storming of what can we do to tap into both of these needs and desires for consumers to help small businesses and for small businesses to get more customers. The idea was here we're getting into the holiday season. It was October timeframe. Is there something we could do around that holiday season? It really came out of some brainstorming. Because of, also, the timing of the fact that now social media was really a big channel, we actually marketed it through social media, came up with this idea of Small Business Saturday, and said "Let's find a day and create a day that small businesses can actually capture their fair share of the holiday shopping and really kick off the season in a big way.


It created a way for us to do a national advertising campaign to support small businesses and also give small businesses the tools to market to their customers. It became the fastest growing Facebook page up until that time during 2010 and really was just lightning in a bottle. It took off and now we're about to launch this year will be year 5 of Small Business Saturday.

Mike O'Toole:
Let me stop here for a second. I run an ad agency and agencies like to talk about big ideas. Naming the day after Black Friday "Small Business Saturday" is a huge idea. It's powerful, it's simple, it's immediately graspable. It leverages and extends what's important in the he culture. It's connected to what American Express does, but not at all parochial. I asked Mary Ann who came up with such an idea. As you'd expect, like many great ideas, it has many authors, but when I pressed her, she did say that someone in corporate affairs deserved a little more credit than others. Well done, whoever you are.


Great ideas go nowhere unless they're played out the right way. We know of Small Business Saturday as a big, enduring part of the business culture today, but it didn't have to be that way. It could have been just another ad campaign. Clearly, American Express had something bigger and broader in mind from the beginning. Mary Ann told a story about the official launch of Small Business Saturday in 2010. Hours after a press conference with New York City Mayor Bloomberg, American Express CEO Ken Chenault was barraged with requests from major corporations who wanted in.


American Express decided to invite other big brands to support the day. In fact, last year, Small Business Saturday had over 160 corporate partners. Just as critical was the conditions American Express set for participating. This couldn't be about self-promotion or selling. It had to be for the benefit of small businesses. How does that work with other companies? I imagine you don't want them selling a products.

Mary Ann:
No. We're very clear about the criteria of how they support. It has to be about giving value to small businesses, marketing the day on behalf of small businesses and not selling their product. For example, we've had FedEx as a partner since year one. FedEx is very focused on small businesses. They provide free printing of the posters that they can hang in their store windows. This past year, we had the US Postal Service who actually shipped out all of our collateral. We provide small business with Shop Small shopping bags and doormats for the door. We had Facebook and Twitter providing free advertising for small business to market to their customers. Then beyond that, it's corporations who are marketing to their consumers today to say "Get out and support your small business in your local community on the day."

Mike O'Toole:
You said, I think it was, companies coming together under American Express' leadership to provide value to small businesses not to sell. It occurs to me if the goal is to provide value, you're not going to get in trouble with people trying to promote themselves. People are signing up for that and being useful to customers as opposed to trying to promote a commercial interest. That's got to keep everyone aligned.

Mary Ann:
Yes, yes. It has kept everyone aligned. I think from year one we've said there's no exclusivity in partnering with us, because it's not about us. It is about the small business. It is not about your products unless you're offering value that supports the day, such as the free printing and free shipping. I have to say, it's not a difficult discussion. Everyone really understands and it's been our belief from year one that if we help small businesses, the pie grows, the economy grows and we all benefit.

Mike O'Toole:
I want to underscore a critical point here. Small Business Saturday would not have become what it was if American Express hadn't made a basic and unconventional decision. The day was not going to be about American Express. It was not going to be about driving credit card applications. It was not going to be a tightly controlled message or campaign. This had to be true to attract other big brands like FedEx, but it absolutely had to be true to pass the smell test with small retailers. How much does American Express own Small Business Saturday?

Mary Ann:
We were very clear from year one that Small Business Saturday, we didn't own it. Small Business Saturday was we were creating this movement and this day for small businesses. It was not about us, so we specifically called ourselves a founding partner and leading partner of small business. We created the day. We are proud of the fact that we created the day, but we don't own it. In fact, in that first press conference, when Ken Chenault announced the day that we were creating, he was asked that question of, "Well, are you just promoting this to American Express card members?"


He said "No, this is about getting consumers off their couch and going out and supporting small businesses on this day. If that means you're going to use cash or check or a competitor's credit card, as long as you go and spend at a small business, then that's what we want you to do and we'll be happy about that." That's been very much the way we've also measured the success. It's about what are consumers spending at small businesses on that day, not just with American Express.

Mike O'Toole:
Not about accounts opened for American Express or something.

Mary Ann:
Exactly.

Mike O'Toole:
It's co-owned in a way with a lot of other parties, including some of the other brands that have participated. What about the retailers themselves? Have you seen them co-own it in a way, take ownership over this initiative?

Mary Ann:
Yeah, absolutely. In fact, last year was another exciting sort of movement that we saw happen. It was actually started in 2012, and every year we go back and do a bit of a post-mortem and say what worked, what was different this year, what felt different, what do we need to work on for next year? In 2012, what we saw popping up that was really exciting was communities getting involved in it, communities creating events, getting their businesses in the community involved and actually promoting each other. In fact, in Detroit, one of the businesses created what they called a passport. They literally had you stamp, created a passport, you would go to each business and they had a Shop Small stamp. You would get a stamp and at the end of the day you would get discounts based on shopping at other small businesses. How often do you see a business promote another small business?

Mike O'Toole:
Oh, this was a retailer, not a chamber of commerce.

Mary Ann:
This was a retailer.

Mike O'Toole:
What's the name of the company? Can you share it?

Mary Ann:
It was Pure Detroit in Detroit. That's something that now is, we literally took that idea, because we're not shy about taking great ideas and then sharing it elsewhere, and they were very proud of that, but that one idea as well as the other 50 or so communities that we saw pop up gave us the idea for 2013, which was to create what we called the Ambassador Program, where we actually did promote this to chambers of commerce in a much bigger way than we had in the past. We created an online toolkit to say "Go out and get ..." We actually had a requirement. If you want to be part of this Ambassador Program, you need to sign up at least 10 small businesses in your community, create some kind of an event, tell us what you're doing and we will provide you with collateral. We'll give you signage and promotional posters for the town and banners to hang across the street and the door mats for each of the doors of the small businesses.


We said we would be happy if we got 500 communities and we got close to 1500. In fact we had to shut it down because we just ran out of collateral.

Mike O'Toole:
There's only so many doormats, right.

Mary Ann:
We weren't prepared for the volume. That was a really exciting breakthrough that happened last year. I think that really was just a watershed moment of "This has really been embraced by the small businesses and by the communities, more importantly, because it really is about your community and your main street."

Mike O'Toole:
Yeah. Because it seems like maybe that's how you define a movement. A movement evolves in ways that you can't predict. You didn't really see that coming, but it sounds like the strategy has been to respond quickly on your part. If you see it, feed it.

Mary Ann:
Exactly. That's worked really well. It's evolved every year. I mean, in the beginning it was about just building awareness. Then it moved to getting small businesses to own the day and really leverage the tools that we made available to them. Now, it's moved to "It's about the neighborhood."

Mike O'Toole:
We talked to a couple of small retailers in Austin, Texas in the city's 2nd Street district. Julie Sutton is their marketing director and one of the community ambassadors Mary Ann talked about. When Julie talks about Small Business Saturday, it is impossible to separate from other initiatives they run to promote their retailers. Here's Julie talking about their holiday Window Walk, where they provide scholarships to local students who decorate store fronts in the district. Long before Small Business Saturday, they used Window Walk to drive traffic. Now, Small Business Saturday and the holiday Window Walk reinforce each other all to the benefit of her retailers.

Julie:
The first Small Business Saturday that the entire 2nd Street district participated in was 2012. That was the second year that we had done the Holiday Window Walk. We made sure that the unveiling of the windows correlated with Small Business Saturday. I really do appreciate the fact that it is kind of a one-size-fits-all in that you don't have to fit any strict parameters. By the way, if Austin had to fit any strict guidelines, nothing would happen. Everyone here has to branch out and do their own thing. We're not Dallas, we're not Houston. In fact, the 2nd Street district is different than far up north with the other mainstream shopping centers. We want to make sure that we have our own flavor.


Before, traditionally, we wanted to say "Okay. Black Friday. We've got to do something to generate that interest." Now we really have a set plan and a guideline, a template to go by and say "Okay, Small Business Saturday, that's when our windows are going to be unveiled and it just kicks off the season really well."

Mike O'Toole:
We'll continue our conversation with Mary Ann Fitzmaurice Reilly of American Express after the break. We'll talk with her about measurement and specific holding the Small Business Saturday campaign accountable. I'm Mike O'Toole and this is The Unconventionals.

Speaker 1:
You're listening to PJA Radio's The Unconventionals. If you'd like to learn more about the show or join in on the conversation, check out our Facebook page. Facebook.com/unconventionalsradio. Our academic sponsor for The Unconventionals is the Center on Global Brand Leadership at Columbia Business School, which turns the research of academia's foremost thinkers on branding into practical tools and insight for real-world application. For more information, visit GlobalBrands.org

Mike O'Toole:
Welcome back. We're talking with Mary Ann Fitzmaurice Reilly of American Express about Small Business Saturday. It's pretty clear that Small Business Saturday wasn't conceived of as a typical campaign. You certainly couldn't hold it accountable by standard measures. American Express invests many millions of dollars every year. They have to look at what they're getting for that money. I want to talk about getting credit, because this is not a commercial enterprise for you guys, and that's clear. At some point, it probably feels important that people connect it to American Express and I know in my home town there's people, there's retailers who put out cardboard signs that say things like "Shop Small Saturday" or "Shop Local Saturday." I don't know if they connect that to American Express. Does that bother you if they don't?

Mary Ann:
No. You know, personally I would love to get credit for it, because of course you feel like "We created this and the fact that many people don't know that, it's a little bit of an ego thing that you feel like "Well, how could you not know that. We created this and it's going into your five." More importantly, the fact that whether you call it Shop Small Saturday or Shop Small Weekend or Shot Small Local, it has become a movement that these small businesses are embracing. If can walk down the street and see that and we are seeing the small businesses gaining those sales, in 2013, we saw spend go up from 5.5 billion at small businesses on the day to 5.7 billion in 2013.


That was on a weekend where large retailers saw spend decrease on Black Friday as well as over the weekend, so that was really a bright spot in that holiday shopping weekend. That feels good. If it takes small businesses owning it in their own way and evolving it in their own way, that's okay. There are small businesses that don't accept American Express and they're still able to promote the day and if they don't mention us, they're leveraging something that American Express has created and if they remember that or think of that at some point, that's great. If they don't, it's still contributing to the overall movement.

Mike O'Toole:
Small Business Saturday is an initiative to lift up the small business sector. The measures American Express cares most about is the health of that sector. The revenue growth figure that Mary Ann shared is a pretty direct way to look at it. We asked one of the small business owners in Austin's 2nd Street district to make the connection. How does Small Business Saturday help his business and others in his community.

Sean:
I'm Sean [Bear 00:20:46] from Milk and Honey. We're an Austin-based spa and salon. I think a lot of small businesses fail because of a lack of marketing support. Ultimately, if you have a good product, you can't just depend on people seeing your sign and coming into your store. You have to market but it can be very expensive. Things like Small Business Saturday provide small businesses with foot traffic, provide them with considerable advertising resources and those considerable advertising resources I imagine, for some businesses, make the difference between having a slow day or a busy day.

Mike O'Toole:
American Express looks at sales growth for local retailers, but it goes deeper than that. Certainly Mary Ann and others find themselves in meetings where they're asked to quantify the impact of the program. I asked her, what are some of the key measurements you look at?

Mary Ann:
We look at a lot of key metrics, but I would say most important is awareness of the day by both small businesses and consumers. Obviously, importantly. We look at the tools that are downloaded by small businesses, which really is then engagement. This past year we looked at the number of neighborhoods who leveraged the ambassador program. We look at the number of times Small Business Saturday is mentioned in the press, particularly in terms of the words mentioned in the conversation about Black Friday and Cyber Monday, where it's clear that it's become a movement. We look at sales on the day. Importantly, that's ultimately the key measure is are more consumers supporting small businesses on that day. Ultimately, as it becomes more and more of a movement, it's not just about the day. That's why we created Shop Small and a lot of the permanent collateral is Shop Small.


That one day is really to trigger the thought with consumers that it is important to support your small businesses. That, to me, is really a kickoff to supporting for the rest of the holiday season and hopefully for the rest of the year. That's where I really think the ongoing initiative that where you see more and more of just "Shop Small" around the rest of the year.

Mike O'Toole:
Not attached to it, yeah.

Mary Ann:
Not attached to Small Business Saturday, it really has had this halo effect and has a long tale beyond the day.

Mike O'Toole:
Yeah. You look at spending increases in the small business retail sector. Have you seen anything else along those lines, like longer-term shifts in spending from big retailers to small retailers, growth in overall spending?

Mary Ann:
We don't look at the shift from big retailers to small retailers because that's not really the intention. We certainly don't want the bigger retailers to suffer. They're customers and partners of ours as well. It's really about just giving a share of your holiday spending to small businesses. We look at really the small business spending and it's both qualitative and quantitative. We do the quantitative research to understand how consumers are spending and how much they're spending at small businesses. We look at our spending to see if we can see some trends on the day with American Express.


We talk to small businesses and ask them what increases in spend they saw on the day. That's important as well, just to understand the year over year growth as they market Small Business Saturday, what are they seeing. That's been really the most important point is the excitement from these small businesses themselves where they talk about seeing 80% lift in spending from that day or that weekend from the prior year. That's really what it's all about.

Mike O'Toole:
Do you, and this may be hard to do, but have you tracked an increase in American Express business measures as, again, Small Business Saturday account openings, transaction volume?

Mary Ann:
No. I mean, we look at transaction volume, but really as an indicator of volume holistically going to small businesses because if we're seeing a left-end transaction volume with small businesses, on American express, typically that coincides wit the lift that we see in overall spending on all payment products with small businesses. We do not promote account openings. That's not the objective. It's not something that we're tracking, and we've been very pure about Small Business Saturday, of not allowing any of our Small Business Saturday, the website or any of the materials to link to or try to promote our own products. It's really about the day and promoting small businesses.

Mike O'Toole:
Part of Small Business Saturday and it's no-strings-attached support of small businesses, reminds me of what Converse is doing with Rubber Tracks Studio. We featured the Rubber Tracks Studio story on an unconventional episode last season. Basically converse opened a world-class recording studio in Brooklyn, staffed it with top-tier producers and give musicians access to it for free with no hidden agenda. In return, Converse gets a tremendous amount of good will, not to mention publicity from musicians, who are our core customer base. I asked Mary Ann if small businesses end up advocating for American express in the same way.

Mary Ann:
Very similarly, just small business going out. If you go to our site, ShopSmall.com, you will see videos of small businesses talking about the day. Who better to talk about Small Business Saturday and American Express if they choose to talk about American Express, than our own customers? Definitely favorability of small businesses towards American Express is a nice added benefit. It's not one of our key metrics, but it definitely is something that we've seen is from a brand perspective, when you are creating something that has become a movement and is so positive, favorability towards the brand is clearly something that's a nice outcome.

Mike O'Toole:
It's important to realize that American Express is a founding sponsor, but not the star of the show. Success is measured in growth of Shop Small but also the success of small businesses overall. If I can say it, there's a sense of humility that you don't often associate with global brands. Perhaps the ultimate measure of the success of the campaign is that at this point it's strong enough to continue on with or without American Express. Here's Julie Sutton again from Austin's 2nd Street retail district.

Mary Ann:
If American Express stepped away, I don't know who would take the reins. I don't know if necessarily anyone needs to take the reins. Maybe the carriage just goes off by itself. I think that that's okay, too, because right now it's in the hands of the local business owners I think that they're fully capable to do with it what they will and make it a wonderful experience for the consumer.

Mike O'Toole:
Small Business Saturday is unique in its scale and in its impact. The principle of brands playing a role that are bigger than selling products or promoting their commercial interest is catching on. Let's talk to David Rogers, director of the Center for Global Brand Leadership at Columbia. One thing that makes Small Business Saturday different than any other campaign, and I suppose you might not even call it a campaign, is that it's not really controlled by American Express. They're a founding sponsor, but they don't control it. They never intended to control it.


As it evolved, Mary Ann talked about how it moved from, hey, American Express was really driving it the first year, but then they really started to get the retailers to take on more ownership. Then the communities.

David:
That's what's happening with powerful marketing these days and brands is that the company still has a central role to sort of initiate and to conceive ideas and be an innovator but it's not trying to do the whole job. You're thinking about your customers as networks, whether they're end-consumers or business customers, and networks of networks. You're moving from, ideally, in the case like this, the company-initiating idea to, as you said, the businesses, like in Detroit and elsewhere picking up and bringing it to life, taking it to the next stage, to communities, right? These communities, that if they each, 1,500 of them, and if they each get enough companies participating then it's coming to life. Global is, I guess, the next stage and how do you bring this idea, adapt it maybe locally to different markets. Again, it's all about expanding a network of participation beyond the brand that started it but keeping the brand as a core element throughout.

Mike O'Toole:
Thanks for joining us. We love your comments and are always on the hunt for great, unconventional business stories. Let us know what you think on Facebook.com/unconventionalsradio. Join us next time when we'll be talking with Dave Engberg, founder and chief technology officer of Ever Note.

Speaker 1:
The Unconventionals is written and produced by Mike O'Toole and Reid Mangan. Post-production and technical direction by Reid Mangan with Emamnuel Ording and Anthony Gentles. Promotion and social strategy by Greg Straface and Graham Spector with [Tory O'Neil 00:30:53]. Our creative director is Aaron DaSilva. Our executive producer is Phil Johnson for PJA Advertising and Marketing. I'm [Jofea Lahey 00:31:03]. To hear more episodes of The Unconventionals, visit PJARadio.com

Mike O'Toole:
This is PJA Radio.

THE UNCONVENTIONALS
THE UNCONVENTIONALS

Discover more incredible stories of counter-intuitive moves that paid off big.

EXPLORE

NEVER MISS AN EPISODE.

Subscribe on iTunes now.

NEVER MISS A STORY

Brand for change

Life is too short to build an ordinary brand. Get ongoing perspectives on marketing that creates your highest value opportunities.