Retail therapy | Merchants look to growing buy-local campaigns for greater sales

When a longtime credit union recently moved out of Bowdoinham’s tiny village, the downtown merchants experienced a communal shudder. With a population of 2,612, Bowdoinham has a town center with one store, one restaurant and one gas station nestled around a sharp corner on Route 24. Once drivers make the quick turn in the road, they’re already headed out of town, and an empty business has a big impact.

“What is really sad is our little credit union left us,” Bowdoinham Town Manger Kathy Durgin-Leighton bemoans. “It was the result of the recession. [Bowdoinham Credit Union] has been in town for over 20 years, maybe 30 years. It merged with Down East Credit Union, and they just left a couple weeks ago. That was a real setback for businesses to lose the local bank.”

Worried about the toll the economy has taken on the town’s business community, Durgin-Leighton is focusing more than ever on a “Buy Local, Buy Bowdoinham” campaign that’s being funded by a downtown tax-increment financing district. By organizing businesses to offer holiday promotions and displaying locally made products at the town office, she is hoping to stimulate the teensy economy within her town’s borders. The town has also hired a woman to run a farmers’ market every Saturday to offer products from local farmers, and it is also updating a business directory on its municipal website, which lists just about everyone, including furniture upholsters, farmers, mechanics and even a grant writer.

“We got creative,” Durgin-Leighton says. “It was not just about shops, because we don’t have a lot of shops, but we do have a lot of arts. Every town has its own niche and we are a town of agriculture and food and artists, so we promote that. But we are also a town of small businesses, and that might be snowplowers, so we’ll promote them as well.”

Even on minute scales like Bowdoinham’s, these buy-local campaigns are becoming increasingly common. New campaigns are springing up in South Portland, Scarborough, Brunswick, Saco and Biddeford. By comparison, Portland has had a prominent campaign for the past four years, with “Buy Local: Keep Portland Independent” window decals, bumper stickers and posters seemingly ubiquitous throughout the city. But it has taken the dire economy and a growing awareness of the benefits of buying locally to push more communities to launch similar campaigns.

“We saw an uptick in people getting organized when the economy turned down. It was certainly a motivator for some folks, recognizing that they can’t just operate on cruise control and expect everyone’s going to make more money every year,” says Jeff Milchen, co-founder of the American Independent Business Alliance in Bozeman, Mont. “And it was also driven by a backlash against corporations, realizing that corporations don’t have communities’ best interests at heart. Their concern is only maximizing profit, and that sometimes conflicts with the community that they operate in.”

Does buy-local work?

Bowdoinham has not yet collected data on the success of its campaign, which began two years ago, Durgin-Leighton says. Shopkeeper David Skelton, who owns the Bowdoinham Country Store, says in the past year his sales have slumped by $20,000. He adds, however, that sales might have been even lower had it not been for the buy-local effort. “Obviously I appreciate the campaign; it’s a good campaign and seems to be advertised well,” he says. “The impact with this economy, though, is hard to judge, but it certainly hasn’t hurt.”

Other shopkeepers are more sanguine about the effects of buy-local campaigns. Lori Irving, owner of Saco clothing boutiques Simply You and Simply You Too, claims her sales have increased 10% since several community organizations started a buy-local movement in Saco and Biddeford last spring. “In the last few months, word has got out. [Customers] say, ‘I’m buying local,’ and they want to let you know that they’re shopping local because they have a lot of choices out there,” she says.

Riding that wave of consumer preference is the SunriseGuide, an annual shopping handbook published by Heather Chandler that offers coupons for local, sustainable businesses. In its fifth year, the guide has nearly twice the coupons as last year’s and expanded from southern Maine to include the midcoast.

Pushing against big-box stores — the Walmarts, Targets, Home Depots, Lowe’s and Borders that dominate many malls on the outskirts of communities — is a bit of a David and Goliath struggle. While some studies show small, nearby shopkeepers benefit from spillover mall traffic, the low prices and endless inventory of major chains have driven other small competitors out of business. Yet national retailers are also joining the buy-local movement and stocking shelves with more locally made products, according to Curtis Picard, who as executive director of the Maine Merchants Association, represents large and small retailers. “They want to be sure they’re offering the right product mix at the right price to get people through the door,” he says.

Buyers for Walmart and other retailers now regularly attend the annual New England Products Trade Show in Portland to find crafts, specialty food products and home furnishings for their stores, he says.

Buy-local activists, in response, stress the independent part of the buy-local push. And they say their efforts are starting to make a small but significant difference. Milchen, with the American Independent Business Alliance, estimates there’s now about 130 buy-local campaigns nationwide, a number that’s doubled over the past four years.

Stacy Mitchell, a Portland-based researcher who works for the Institute for Local Self-Reliance and is a board member of Portland Buy Local, surveyed 1,800 independent stores across the country last winter. She found that retailers in cities with “Buy Local” or “Think Local First” campaigns, as she describes them, reported their holiday sales increased by 3%, compared to 1% for those in cities without an active buy-local initiative. Moreover, in a Portland survey Mitchell conducted last year, she found that 84% of the almost 400 members of the Portland Independent Business and Community Alliance said the campaign has had a positive impact on their businesses.

Mitchell also says almost 60% of Portland members reported that they now seek out local, independently owned businesses for services and goods that they previously purchased from non-local sources. Milchen says this last point is critical to the success of buy-local endeavors, but that business-to-business relationships are often overlooked. “It’s a key part of any alliance, to get business owners to say, ‘We have a lot to gain by doing business with each other. Why save a few bucks by getting supplies at a big-box store if I’m losing an opportunity to do business with my neighbor who could be buying my services?’”

He adds that the more robust campaigns don’t just focus on small businesses, but also include downtown anchors, such as hospitals, governments and schools, which can use their institutional purchasing clout to fortify the cause.

Grassroots versus top-down

Although the buy-local cause is generating an increasing amount of buzz, many campaigns fizzle after a few months or a year. “The overwhelming majority of buy-local campaigns fail to make an impact,” Milchen warns. “Effective campaigns need to be sustained over time. If your community is not committed to doing it for many years, it is not worth doing at all. It takes time to shift culture and educate people about the many benefits of doing business locally.” [See the sidebar on the next page for the Institute for Local Self-Reliance’s economic reasons for buying locally.]

Mitchell emphasizes, too, that it’s essential for business owners — and not just civic leaders — to try to shift consumer habits. A town office may create flashy campaign materials, but what really matters is how business owners use these materials in their stores and advertising. “That creativity and energy that comes from business owners themselves makes all the difference. Our research and analysis of looking at campaigns for 10 years or so shows [a top-down effort] doesn’t make much difference.”

Recently, two communities in Maine have taken different approaches to sway shopping preferences. Saco and Biddeford together launched a buy-local effort nine months ago driven by four civic groups: the Biddeford-Saco Economic Development Corp., Biddeford-Saco Chamber of Commerce and Industry, Heart of Biddeford and Saco Spirit. They raised $50,000 from local businesses — including big companies such as KeyBank and Time Warner Cable Media Sales — to purchase advertising and promotional materials like reusable shopping bags.

The plan for the future is for member businesses to pay $50 in annual fees to fund the effort, explains William Armitage, executive director of the Biddeford-Saco economic development group. “The theory was that we’d have a big push and invest in the website and the bags, and other things, and then have businesses make some annual investment in it to sustain it,” Armitage says.

Meanwhile, South Portland businesses also recently started a grassroots effort to stimulate a buy-local ethic. Members, of which there are about 140, are raising money with dues and by selling ads in their new local business directory that will be sent to residents in South Portland, Cape Elizabeth and Scarborough, according to Jon Platt, the owner of Nonesuch Books in South Portland and Saco. (He’s involved in both communities’ campaigns.) The South Portland group, SoPo Buy Local, is building a website, too, that will give every member its own page. It has also worked out a deal with the community newspaper to run a regular group ad that any member can join in on.

“Honestly, I think that any time something is done from the grassroots up it will be better, because you end up with greater ownership from the business owners,” Platt says. “Ultimately, the challenge for Saco-Biddeford will be to get greater involvement from members. That has not been as great a challenge for us.”

Biddeford-Saco Chamber of Commerce Executive Director Craig Pendleton says 102 business members have signed up for the buy-local program, and he’s hoping shopkeepers follow through. “We planted the seed, and now they better raise the crop,” he says. “It seems like a very simple concept but people are so brutally independent.”

Irving, owner of Simply You, is, for one, taking advantage of the campaign. She says she’s offering a 10% discount to any customer who comes into her shop with one of the campaign’s tote bags (35 have done so, thus far). And she’s giving out $20 gift certificates for nearby restaurants if customers spend $100 or more in her store. She’s also willing to slip coupons to other Main Street stores into her customers’ shopping bags, she says, and will include the campaign’s “Live Local, Be Local, Buy Local” slogan in her future ads.

“The door is there, they have to open it,” she says of other merchants. “In this economy, we don’t need to complain, we need to work together.”

Milchen stresses that the best way to trigger change is to get people talking about their consumer power by, for instance, presenting in front of civic groups or having tables at fairs. Talk is cheap, too, and he downplays the importance of having a big budget. “We’ve seen campaigns that start off with $2,000 in their first year and still succeed in making a significant impact if they’re engaging citizens and getting buy-in from business owners to spread the message,” he says.

Portland Buy Local’s budget is now $25,000, the largest it’s ever been, Mitchell says. The majority of this money is spent by its all-volunteer board on outreach, such as publishing an annual directory of independent businesses, maintaining an online directory and producing new poster campaigns every couple of months. The funds come from Portland’s members through dues, sponsorships and display ads.

“Portland is one [community] that is doing an awful lot right,” Milchen observes. “No one can hardly spend a day in Portland without seeing some evidence that this is a community that cares about local business.”

He also says a successful alliance gives small businesses opportunities for group purchasing or ad sharing, as well as pooling their collective power to lobby government or media.

Bookshop owner Platt says the new local networks are giving small businesses a fighting chance. “It gives owners an opportunity to talk together and network and problem solve,” he says. “The economy has crashed, and we need to find ways to work together as community members to strengthen ourselves and get a good common voice.”

Rebecca Goldfine, Mainebiz staff writer, can be reached at rgoldfine@mainebiz.biz.