Who Wins When Congress Makes Shopping Suggestions?
Members of Congress love to extol the virtues of American small-business owners, so it should come as no surprise that several have thrown themselves behind a buy-local Thanksgiving weekend initiative dubbed Small Business Saturday.
“I encourage shoppers to visit your neighborhood small businesses on Saturday, Nov. 26,” chirps the voice of Sen. Mary Landrieu (D-La.) in a radio public service announcement to promote the campaign. “We need to spend on Main Street in order to boost our national economy.”
But up close, the Small Business Saturday movement looks more like something associated with corporate America than with local mom and pop grocers, diners and gift shops. The multimillion-dollar campaign was launched by American Express in 2010, and this year it has backing from Facebook, Google and more than two dozen corporate supporters in the telecommunications, airline, hospitality and other industries.
Landrieu is one of a half-dozen Senators who has recorded PSAs to promote Small Business Saturday, all of them members of the Senate Small Business and Entrepreneurship Committee. Landrieu and Sen. Olympia Snowe (R-Maine) also recently won approval for a Senate resolution officially designating Nov. 26 as Small Business Saturday. The concept derives from the post-Thanksgiving shopping days known as Black Friday and Cyber Monday.
“We’re trying to create consumer demand for shopping at small, local businesses during this time of year, which actually defines the success or failure of a lot of retail establishments,” said Ann Sullivan, head of government relations at Women Impacting Public Policy, a trade association that represents female business owners and is playing a leading role in promoting Small Business Saturday.
It was WIPP officials who encouraged Landrieu, Snowe and others on Capitol Hill to record PSAs for the campaign, she said. The group has also asked members of the House Small Business Committee to promote the program. When WIPP members came to Washington, D.C., for their annual conference last month, they talked up Small Business Saturday in their meetings with Members of Congress.
“They were a natural ally to try to spread the word, in addition to local and state elected officials all over the country,” Sullivan said. State and local officials also are recording PSAs to promote the group and are planning to turn out Saturday to shop at Small Business Saturday events in neighborhoods around the country. Senior officials from the U.S. Small Business Administration will shop at a Small Business Saturday event in Adams Morgan that day.
FedEx has plowed $1 million into the effort, announcing last month that it would give away 30,000 American Express gift cards, each worth $25, as part of a “Shop Small” gift card program.
Google and Facebook have created free tools that business owners can use to promote themselves digitally. American Express will give the first 200,000 consumers who register on a Facebook page and spend $25 at a local store on Small Business Saturday a $25 statement of credit. That alone represents a $5 million investment. The 200,000 cap, moreover, may be relaxed to accommodate more customers.
All of this has prompted some analysts to wonder whether Small Business Saturday is more about American Express, which has a reputation for high merchant fees, than it is about local, independent retailers. In 2010, Small Business Saturday boosted sales at small businesses accepting American Express cards by 28 percent over 2009, but nationally, retail sales went up by only 9 percent overall, according to the business newsletter Multichannel Merchant.
An American Express official said the campaign is about helping small businesses, not about the card company’s bottom line. “If you look at all the work that’s being done in terms of creating awareness for shopping small on the day in general, everybody benefits from that,” American Express spokesman Scott Krugman said.
As chairwoman of the Small Business panel, Landrieu meets frequently with groups interested in promoting small businesses, a spokesman said. The other Senators who recorded PSAs for the Small Business Saturday campaign are Scott Brown (R-Mass.), Maria Cantwell (D-Wash.), Benjamin Cardin (D-Md.), Kay Hagan (D-N.C.), Marco Rubio (R-Fla.) and Snowe.