While the COVID pandemic brought dramatic shifts in employment that disrupted many lives, it also created a record-breaking number of entrepreneurs — driving the largest increase in new business applications in history. But as many of these new retailers adjusted to a “click to brick” economy, finding the time to build their brand in a crowded online market was a major challenge ... without the right help.
More than 4.3 million new business applications were filed in 2020, a 24 percent increase over the previous year. Retail trade saw the highest gains, with a 58 percent year-over-year increase in 2020. And the number of Black-owned businesses is currently 30 percent above pre-pandemic levels, with women driving much of that growth.
LaToya Tucciarone started SustainAble Home Goods as a brick-and-mortar store in Atlanta. Her business is a fair trade and ethically-sourced home decor and lifestyle brand, using commerce to bring financial stability to marginalized communities. Tucciarone wanted to create a platform where customers would know everything they buy is made intentionally with a positive impact.
When the Black Lives Matter movement swelled in May 2020 and June 2020, the spotlight on Black-owned businesses drove a 4,000 percent increase in sales for SustainAble Home Goods. But Tucciarone didn’t know if she was looking at a “moment or a movement,” as she put it. Should she make long-term investments in staff and inventory? Or would sales go back to normal in a few months? She took the leap, but found building online loyalty with her customer base was a big task for a small entrepreneur. She just didn’t have the capacity to improve her online marketing in a way that would keep the brand's momentum going.
Ethan Cohen, vice president of ecosystem and community at the SaaS-based e-commerce startup Yotpo, was also asking how Black-owned businesses could use this opportunity of increased awareness to take advantage of this inflection point in time. Cohen had provided strategic support to global brands like Patagonia and Ikea, and knew the impact marketing automation and hands-on experience can have to generate consumer awareness. He helped launch the Yotpo Grow incubator and started working with six companies in the first cohort.
Yotpo helped Tucciarone expand her site’s reviews and user-generated content capabilities, which made it easier to feature product pictures created by customers. She also implemented a loyalty program and SMS marketing.
“Yotpo came in and really filled in some gaps,” said Tucciarone. “Being able to have that support around marketing was a dream come true. Getting SMS, loyalty and reviews was amazingly helpful — I wouldn’t have had the capacity on top of everything else.”
SustainAble Home Goods' email campaigns for soliciting reviews saw immediate results — a 47 percent review request email open rate, and a 21 percent reviews engagement rate. In addition, the brand's SMS campaign delivered a 472X return on investment. Cohen says that newer tools such as SMS marketing can really help brands escape the "Gmail Promotions tab wasteland" facing so much of email marketing today.
“SMS is just faster and easier for consumers to react to," Cohen noted. "If you do it right, you can really have an impact. The tone doesn’t have to be commercial; it can be nice and friendly. SMS is really the low-hanging fruit, but reviews can be very strong for social proof, and loyalty programs are where retailers can really build a long-term relationship with that consumer.”
Yotpo Grow launched last year to help provide a full marketing platform for these entrepreneurs, but it also offers a supportive community and provides small businesses access to a level of data and insight they wouldn’t have otherwise.
For LaToya Tucciarone, she's excited to continue growing her company both online and offline. As an entrepreneur, “You get to help create the world you want to be in," noted Tucciarone. "You have to know the ‘why’ you’re sacrificing so much of your life for a new business. Be ready to dig deep — if you’re changing the world, it’s going to be hard.”
The Yotpo Grow program is currently reviewing applications for the 2022 cohort, and is looking forward to working with the next group of innovative Black-owned retailers. Products from SustainAble Home Goods are available at their store in Chattahoochee Hills, GA, and online.
Ethan Cohen is the vice president of ecosystem and community at Yotpo.