How digitisation can help hyperlocal businesses grow
By going digital, small businesses can become more discoverable and what’s more, they can have less dependency on aggregators for their visibility
Hyperlocal businesses are those that are specifically tailored to meet the needs of a particular community or neighbourhood. Traditionally, such businesses have always preferred to be offline and function with what they call a 'personal touch.' However, with the advent of digitisation, they have been forced to pivot and adapt to being online, but not all have done so and the full-fledged migration to digitisation still remains incomplete. Hyperlocal businesses, however, stand to gain immensely from digitisation as it can help them to grow and fulfill their untapped potential.
What is a hyper-local business?
A hyperlocal business is defined as a place where a merchant/ business is able to create tremendous visibility in a defined zone and cultivate a symbiotic relationship with other merchants around in terms of cross-selling and offsetting each other's products. This is in contrast to businesses that may operate at a regional or national level. This can be particularly beneficial to tourism, as visitors can get a taste of the local culture by shopping at small businesses. In addition, hyperlocal businesses tend to be more environmentally friendly, as they often source their goods and services from within the community. For example, a travel agency or a hotel would be considered a hyperlocal business. While they may have some online presence, the majority of their customers come from the surrounding community. Hyperlocal businesses often represent the backbone of a city or town's economy and play an important role in promoting tourism and supporting local artists and craftspeople, and they help create a network effect that has a viral growth effect.
How can digitisation impact hyperlocal business growth prospects in India?
India is a country of immense diversity, with a rich culture and history that draws tourists from all over the world. However, due to the myriad of small and medium businesses and service providers scattered across the country, it can be difficult for business owners to truly stand out from the crowd and connect with their customers one on one. This is especially true considering today's aggregator culture that is impersonal and doesn't offer a level playing field for small and medium businesses who might not have the tech-savvy capacity to push their visibility and therefore lose out on being noticed or having any personal connection with their intended audience.
This is where digitisation can step in and can contribute to hyperlocal business growth in India.
1. Profitability and revenue: Profitability remains a top priority for any business. By taking a business online and leveraging the power of digital tools, entrepreneurs can open up the doors to increased profit margins and more revenues. This is because by going digital, small businesses can become more discoverable and what's more, they can have less dependency on aggregators for their visibility. Eventually, this can help get rid of the steep commissions charged by aggregators and small business owners can get the chance to retain 100 per cent of their earnings, resulting in increased revenue and profit margins.
2. Saving on time and effort: More often than not, small business owners have more than one business to look after. In such a scenario, digitising a business has more than one benefit. Simple digital tools that allow business owners to create a booking portal to automate the intake of bookings 24x7 and ensure that a booking-related query is never missed out on, can help immensely. Such steps can enable service providers to seamlessly consolidate bookings and queries that come through several digital channels such as WhatsApp, Facebook, Instagram, Justdial, and Google. In the long run, this empowers small and medium business owners to run their businesses remotely and not be bound to one location all year round.
3. Improved customer service: For hyperlocal businesses, customer satisfaction becomes even more important as they function in tight-knit communities and word of mouth can be a powerful boon or bane. Small businesses have traditionally struggled to provide the same level of customer service as larger businesses because of the lack of digital tools at their disposal. Thus, using simple digital tools such as contactless payments could mean the difference between a customer choosing one product or service over another.
4. Data-driven Insights: While this sounds like a term reserved for big tech businesses, even small and medium businesses can leverage the power of digitisation to gain insights that can help improve their business. For example, the digitisation of bookings can help them to understand more about who their customers are. Information about customers' age, social background, residence etc. are all details that can help generate valuable insights, building a treasure trove of data that can help business owners to learn.
The bottom line is that digitisation can help hyperlocal businesses in more ways than one. And today, there are several quality business enablement platforms looking to help entrepreneurs to build a digital presence for very little money. Small and medium service providers and business owners can, thus, leverage these close to zero-cost migration offers and set up their online presence hassle-free with minimal cost investment.
(Viineit Toshniiwal is Founder and CEO of Bizzo, a startup that allows small and medium businesses (SMBs) to build their own booking portal, digitize their inventory & receive bookings 24/7)
