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Insight of the Day: Customers spend the most money in these small retailer categories

Adobe's new analysis sheds light on consumer spending at small retailers, revealing the top categories, discovery methods, and demographics driving this trend.

Key Findings:

  • Top Spending Categories: Consumers spend the most money at small retailers in the following categories: Furniture, Groceries, Automotive Repair, Fitness Services, Clothing, Pet Care, Eco-Friendly Products, Home Decor, Beverages, and Beauty Products.

  • Monthly Spending: On average, consumers spend $128 per month at small retailers, with millennials and men leading the way.

  • Discovery Methods: Consumers primarily discover small retailers through friends, online reviews, family, community events, and social media platforms like Facebook and Instagram.

  • Generational Preferences: Baby boomers favor small automotive businesses, Gen X prefers beauty products, millennials lean towards art, and Gen Z shops for clothing.

  • Shopping Preferences: While most consumers (78%) regularly shop at small retailers, a slight majority (51%) prefer to do so in physical stores rather than online.

  • Online Presence Matters: 31% of consumers have avoided shopping at small businesses due to their lack of a website, highlighting the importance of an online presence.

  • Reasons for Supporting Small Retailers: Consumers support small businesses due to their local nature, small business status, and sometimes because they are women-owned, minority-owned, or LGBTQ+-owned.

Implications for Small Retailers:

  • Focus on Key Categories: Small retailers in the top spending categories should leverage this trend to attract and retain customers.

  • Embrace Online Presence: Investing in a website and social media presence is crucial for reaching a wider audience and driving sales.

  • Cater to Generational Preferences: Tailor marketing and product offerings to specific demographics to maximize appeal.

  • Highlight Values: Communicate the unique values of being local, small, or diverse-owned to resonate with conscious consumers.

  • Enhance Customer Experience: Provide excellent customer service both online and offline to foster loyalty and positive word-of-mouth.

Additional Insights:

  • Gen Z consumers are more likely to avoid businesses without a website and show the highest support for diverse-owned retailers.

  • Groceries, bakery goods, and beverages are the most frequently purchased items from small retailers.

  • Instagram and TikTok Shops are considered important by a significant portion of consumers.

By understanding these consumer trends and preferences, small retailers can adapt their strategies to thrive in a competitive market.

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