Study Shows Small Businesses are More Optimistic Than Ever Entering 2022
According to the 2022 SMB Outlook from the Visa Global Back to Business Study, 90 percent of small business owners are optimistic about the future of their businesses — the highest levels of optimism found in Visa’s studies to date.
Visa’s study surveyed 2,250 small business owners (with 1,000 or fewer employees) and 1,500 consumers across nine markets — including Brazil, Canada, Germany, Hong Kong, Ireland, Russia, Singapore, United Arab Emirates and the U.S. — in December 2021. The report marks the sixth consecutive edition of Visa’s Global Back to Business study.
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Along with a surge in optimism a standout change was seen in this year’s study, Jeni Mundy, global head of sales and acquiring at Visa, told WWD was increased use of digital payment methods. In fact, 82 percent of SMBs surveyed said they will accept digital options in 2022 and 46 percent of consumers surveyed expect to use digital options more often in 2022.
“These high levels of optimism go hand-in-hand with how much better equipped small businesses have become,” said Mundy. “The digital capabilities that so many small businesses built up during the pandemic — from contactless payments to e-commerce — helped them pivot and survive. [In our study] four-in-five (80 percent) small businesses agreed that, with the right tools in place, their business can compete against any competitor. That level of response reflects both confidence and optimism — a welcome outcome after managing through two years of uncertainty.”
Getting online has been crucial for small businesses during the pandemic and for 90 percent of those surveyed increased efforts to sell via e-commerce was the reason they said they survived during this time. On average, the businesses reported that more than half of their overall revenue came from online sales in the last three months.
Notably, this came in tandem with rising consumer demand for more digital payment options. In the consumer portion of its survey, Visa found 41 percent of global consumers have abandoned a purchase in a physical store because digital payments were not accepted. This percentage rises to 59 percent for Gen Z and to 55 percent for Millennials. A third of global consumers also said they would not shop at a store that only offers payment methods that require contact with a cashier or a shared device.
“The pandemic accelerated the shift to digital payments and redefined the boundaries between online and in-store experiences,” said Mundy. “More than ever, people are engaging across multiple channels — shopping online, in-store, and through mobile apps. We’ve seen that SMBs who have embraced digital commerce and made changes to the way they operate not only have weathered the pandemic better but are also setting themselves up to thrive in the future.”
At the same time, almost 90 percent of consumers also said they see benefits to a digital-first payments society, reporting it would be easier for online shopping, less risk of robbery, health reasons and more security.
“I think the most important thing for small business owners to consider is that if they do not invest in digital payments, they risk turning away potential customers,” said Mundy. “The pandemic has accelerated a shift toward digital commerce that was already well underway in most parts of the world and accepting new forms of payments can be a fundamental part of their business’ growth strategy.”
Moreover, Mundy said, while in the past small and micro-businesses worldwide have struggled with traditional payment acceptance there are now solutions to enable.
“We’ve introduced a number of innovations to help reduce this burden,” said Mundy. “For example, Visa Tap to Phone makes it easier for sellers to use the smartphones they already own to accept contactless payments — simply by downloading an app. Customers win, too, as they can make safe, contactless payments with just a tap of their contactless card, phone, or watch to the seller’s NFC-enabled smartphone. Solutions such as this one open up the notion of accepting payments anywhere — even at curbside — for even the smallest businesses.”
As more businesses look for ways to grow amidst continued uncertainty and ongoing disruptions, Mundy told WWD it has been interesting to see how accessible international markets are becoming to small businesses thanks to the digital adoption and evolving technology. Selling online will help these businesses grow through the opportunity to bring products and services to customers around the globe. In Visa’s research, 50 percent of small businesses said they plan to increase cross-border sales in 2022.
“Helping to open that kind of opportunity is one of the reasons Visa remains committed to supporting small businesses, globally,” said Mundy. “While 2020 and 2021 were about embracing cashless and getting businesses online, 2022 will be about building on that foundation and prioritizing the customer experience. Payments aren’t just about completing a sale, after all. The checkout experience is a reflection of your brand. It’s also the last opportunity for small business owners to make a great impression on customers as they walk out the door.”
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