When Frog and Toad LLC launched in 2001, the owners of the gift shop didn’t see the need to create a website, let alone the need to worry about web sales.
But in today’s e-commerce climate, even established small businesses such as Frog and Toad, which has two Providence locations, have needed to adapt to retail trends that have shifted heavily toward e-commerce in the last two years.
Around 30% of the store’s transactions now take place online, compared with 10% before COVID-19, when almost all the sales took place at the brick-and-mortar stores.
The store’s online presence is crucial for success, co-owner Asher Schofield says. “Personally, I don’t see how we could remain competitive as a small business without having it,” he said.
Indeed, e-commerce sales totaled $537.7 billion in 2020 in the U.S. alone and are projected to increase to $723.6 billion by 2025, according to a report by market research firm Statista.
Successful small businesses have not only put more effort into their online stores but also have used their social media to keep customers feeling connected during shutdowns, says Kristen Regine, a professor of marketing at Johnson & Wales University.
“What happened with COVID is the small businesses that never invested in technology were hurt the most because they weren’t able to pivot,” Regine said. “Those that had strong social media, websites and tech infrastructure were able to pivot their businesses … and maintain the communication.”
That means many small businesses have migrated to e-commerce platforms that offer an easy avenue to grow revenue but come with fees and policies that can create hardships, too.
The issue came under a national spotlight when about 29,000 Etsy Inc. sellers closed their shops for a week in April as part of a global strike led by Rhode Island designer Kristi Cassidy.
Cassidy, who makes and sells gothic wedding dresses and steampunk costumes through Etsy – an e-commerce site focused on handmade or vintage items and craft supplies – rallied sellers to push back against increased fees and incentives that shop owners say favor mass-market resellers rather than the independent artists and makers who once formed the site’s backbone.
And it’s not just Etsy. Regine notes that for retailers of all sizes and across all sectors, Amazon.com Inc. holds a massive influence.
“Amazon basically owns the space in everything,” from fashion and electronics to furniture and personal care, Regine said. “They’re a key player for every segment.”
While e-commerce giants such as Amazon and Etsy take a cut from their sellers, many small businesses find the fees a necessary sacrifice, she says. “The goal is to sell more and reach more customers,” Regine said.
Frog & Toad closed its Etsy store in solidarity with strikers last month, and it remains on hiatus. The store’s other outlets, which include additional e-commerce platforms, are lucrative enough to withstand this closure, Schofield says.
While Schofield doesn’t need Etsy for Frog & Toad’s sales, he says he understands why the e-commerce platform, once seen as tailor-made for independent artists and makers, is unavoidable for other small businesses.
Building an independent web store “requires a little more tech savvy, and a lot more time and energy,” Schofield says.
Before the e-commerce boom, conducting online sales “was a simpler job,” he said. “Now, it’s a full-time job” and “necessary for a business of our scale to add more staff and to invest a lot more time and resources into e-commerce.”
Torsten Mayer-Rothbarth, a Barrington-based woodworker and designer, agrees that businesses need to pay attention to e-commerce to be financially successful but takes a different view on the dominance of large e-commerce platforms.
While the platform has its downsides, it has the benefit of convenience, he says.
“Does [avoiding Etsy] mean you have to do more work because you have to be … louder and more verbal, and do that all the time? Yes,” Mayer-Rothbarth said. “But that’s obviously why people like Etsy – because it’s not a lot of work.”
Regardless of what platform a small-business owner uses, “I think, nowadays, if you want to try to make some form of a living on [selling], you can’t rely on just one,” he said.
In addition to selling his work through his own website, and more recently, through Etsy, Mayer-Rothbarth is also a member of the Made in Warren artist cooperative, which has a storefront in Warren.
But many sellers still see the need for diversified e-commerce offerings, with some saying that increasing fees have made the platforms unpredictable, and sometimes unsustainable, when it comes to profit.
Eventually, Cassidy, whose Esty store is called Auralynne, hopes the strike can help to spark an effort to diversify e-commerce options in a way that gives small businesses more power. As a next step, she says, sellers are planning “the equivalent of a union for Etsy sellers” to help fight for independent artists and makers.
Jacquelyn Voghel is a PBN staff writer. Contact her at Voghel@PBN.com.
