Retailers have been giving back to their customers and communities by sending products to frontline workers or ensuring their communities b to c database remain safe at home. Now, customers can return the support to support their favorite businesses.
In response to some brands at risk of closing permanently, customers are choosing to directly support them, starting what we’re calling “the giving economy”. The giving economy is a movement of consumer generosity, and it appears in a couple of forms: direct tips to retailers or gift cards, ensuring cash is still going into the business, and using those cards for later.
Here, we unpack what the giving economy is, the shift in buying behavior, and the tools available for brands to use.
Why the giving economy matters
Many retailers, small or big, face an unprecedented battle by having to close during the pandemic. On average, retailers only have about 19 days of buffer money to keep them afloat.
This remarkable essay by Gabrielle Hamilton in The New York Times, detailing the closure of her decades-open restaurant Prune, provides insight into her emotional decision to shutter the business. Former customers calling up Prune on its last night open in March to place orders they’ll never get signals both how important physical spaces are to communities, and how support does not and will not occur in isolation.
The story of struggle is becoming more common
For many businesses around the world, closures of physical stores or hiatuses on certain practices have extended to months, further online reputation management: boost your digital image now! depleting their capacity to run their businesses as normal. The strain the pandemic puts on them further risks permanent closure.
How customers are supporting brands
In the earliest days of the pandemic, many be numbers businesses shifted online or made their online stores their primary means of business. It served as a way for customers to still shop and provide revenue for the brand.