Small VS Big Business: Are You Putting Your Revenue Eggs in the Wrong Basket?

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By Published On: April 20, 20210 Comments

There is a clear connection between the size of a business and the channel that revenue comes from. How do you measure up?

While we know that retail strategy should change depending on the size of a business, there is still a huge amount of pressure on small businesses to compete with retailers of all sizes. The danger here is that brands and retailers may be focusing their marketing efforts on channels that aren’t the most bang for their buck.

For example, should small businesses be focusing on SEO and organic search when the majority of their revenue is actually coming from email?

Power Retail benchmarking data shows that in March 2021, over 31 percent of revenue for small businesses came from Email and over 28 percent came from Paid Search. In contrast, less than 20 percent came from Organic Search.

Source: Power Retail Switched On


When we look at big businesses, where revenue comes from is flipped entirely. In the same period, over 31% of revenue came from Organic and just under 25% from Paid Search. Compared to small business, where email is a huge driver of sales, Email yields just 10% of revenue for large businesses.

Source: Power Retail Switched On

This breakdown may come as a surprise for some retailers who may not have a complete picture of the industry as a whole. With the massive increase in online sales during the pandemic, online retailers (of all sizes) who aren’t focused on loyalty and brand awareness are missing out on an enormous opportunity. For example, for returning visitors, Email accounts for over 34% of online revenue for small businesses. For returning visitors to large businesses, this exact same revenue percent (34%) is from Organic Search (and is also in top spot). Does your budget align with what the data is telling us?

In a post-pandemic world, retailers need to focus on the channels that yield results, not just in the short-term but as a long-term growth strategy. This is why constantly reviewing where you sit compared to the benchmarked competitors is vital. It means you can identify both gaps and opportunities and ensure that you’re hitting the mark from a strategy perspective.

Power Retail’s benchmarking platform offers retailers an accurate view of e-commerce performance, based on more than 500m online sessions. Want to find out more? Contact [email protected]

About the Author: Natasha Scholl

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