Nextdoor Reports SMB Resilience and Support

Data Scout is Localogy’s series that curates and draws meaning from third-party data. Running semi-weekly, it adds an analytical layer to the industry data that we encounter in daily knowledge building. For Localogy original data, see the separate Modern Commerce Monitor™️ series.

One of the drivers for local commerce — in addition to convenience and proximity — has always been an underlying “support local businesses” cultural sentiment. Now, it stands to reason that a shared obstacle is unifying local communities around that same principle. Call it another Covid-era silver lining.

Beyond standing up to reason, growth in the support-local movement has been validated by a recent study from Nextdoor. This plays out on two levels: conversation about local businesses and visits to them. The latter is obviously more impactful as “talk is cheap” … albeit appreciated to some degree in terms of moral support.

On the first level, Nextdoor reports that its members visit the site more often — as much as an extra session per week. Conversations on Nextdoor about local businesses grew 17x since February. In total it reports that 70 percent of adults are interested in a digital neighborhood resource to connect with the community.

More practically speaking, there’s greater need to seek information about SMBs as we’ve examined. In other words, queries naturally spike given shifting variables like hours of operation, mobile ordering capability and in-store mask policies. We’ve seen the likes of Google and Yelp make UX updates to accommodate this need.

As for specific types of searches, the most popular business categories from April to July were medical & dental (up 201 percent quarter-over-quarter), classes & lessons (up 192 percent), automotive (up 108 percent), and home & garden (up 47 percent).  Grocery and restaurant are down 65 percent and 38 percent respectively.

On to the second and more impactful level — actual store visits — Nextdoor reports that 88 percent of its members report shopping at a local business at least once per week. This is encouraging but it should be noted that figures are down in the aggregate if looking at comparative metrics like year-over-year retail spending.

But on the bright side, other SMB categories are seeing growth — mostly categories that align with shelter-in-place realities. Specifically, Nextdoor reports that home services are seeing transactional growth including landscaping, house painting and carpet cleaning.  Mentions of “movers” on Nextdoor are also up 84 percent.

Strategically speaking, this validates and amplifies some of the principles we’ve been examining over the past few months. Specifically, local businesses that are meeting the moment by accelerating their digital transformation are faring best. Today that’s for survival, but tomorrow it will engender competitive edge.

Lastly, supporting local businesses isn’t just happening in grassroots ways. Brands like GoDaddy and PayPal initiated programs on Nextdoor to support local businesses. There’s some degree of opportunism in these moves, as PayPal benefits from goodwill (and transaction volume), but it deserves a shoutout nonetheless.

A sampling of other data points from the report can be seen below and you can access the full report here.



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