• From the New York Times this morning, a story about how, while "many retailers ramped up their e-commerce efforts while Americans were stuck at home during lockdowns … for others, the pandemic presented new real estate opportunities.
"Some larger online brands — like Warby Parker and AllBirds — have expanded with physical locations for several years, and smaller companies are now experimenting as well, opening free-standing shops, leasing from a retail service or securing short-term spaces in other stores.
"Business owners are motivated by multiple factors. Some have always included brick-and-mortar outposts as part of their strategy, adopting what’s known as an omnichannel approach, which provides a seamless shopping experience across desktop, mobile and physical platforms. For others, renting a store has become more attractive because the cost of acquiring customers through social media advertising 'has become prohibitive,' said Michael Brown, a partner in the consumer products and retail practice at Kearney, a consulting firm. The tipping point varies, he added, but it 'typically occurs where growth has slowed and the cost of acquiring new customers has increased'."
• Also from the New York Times:
"Since Instagram arrived in 2010, sharing food photos, writing a thoughtful caption and adding relevant hashtags have been the foundation of many small food businesses’ social media strategy, and a low-cost form of advertising. Then, at the end of 2021, Instagram’s parent company, Meta, changed the platform’s algorithm to prioritize videos, called Reels. Accounts that don’t regularly post the short-form videos appear below those that have embraced the format in users’ Instagram feeds, resulting in a notable drop in engagement on posts — and, in turn, sales — for many small businesses."
This change, the Times writes, "has left small food companies and their social media managers flailing. Instagram feed captions have functioned as a direct line to consumers and a way to humanize brand accounts."
In essence, the shift by Meta and Instagram has reinforced a lesson for small businesses - that the perception of social media as being a small-d democratic place was largely illusory, and that success or failure is "in the hands of a few corporations."
