Think outside the “big" box: The economic impact of a shop local program
Taking its form in Small Business Saturdays, Restaurant Weeks and vouchers handed out in towns across America, it can be hard to define the economic impact of a shop local program. Shop local programs are programs often spearheaded by the Economic Development department or Chamber of Commerce, to encourage residents to do their dining and shopping at locally-owned restaurants and stores, rather than the big box retailers.
Shopping locally is important—for every $100 spent at a locally-owned business, $68 will continue to circulate in that town or city. For national chains, only $43 remains in the community.
In this article, we go coast to coast and dive into the city of Lancaster, CA and Arlington County, VA’s shop local programs.
The west coast way of measuring the economic impact of a shop local program
The city of Lancaster, CA is Los Angeles County’s 3rd largest city, with a population of 495,561 in 94 square miles, and is home to over 7,000 businesses. They have always encouraged their residents to shop locally, but during the pandemic they created a few formal programs.
One program began as a play on “Netflix and Chill”—their “Takeout and Chill” shop local campaign was powered by $20 vouchers residents could redeem at local restaurants, with City Hall reimbursing the restaurants. They also utilized Open Rewards—a shop local tool powered by Bludot, the leading economic development platform for government.
With Lancaster’s Open Rewards, residents can easily download the free Open Rewards app, shop as usual at their local establishments and earn 5% cash back on their local purchases. To incentivize downloading the Open Rewards app, the city offered a $20 voucher to redeem when signing up. Lancaster loved using a technology that kept the shopping local.
“It's crucial that the investment we're making remains local. So that we’re not just giving out $20 that is spent at Amazon or in a neighboring city, but rather being reinvested back in the community.“ Sydney Yeseta, Assistant Manager for Economic Development for the city of Lancaster, CA
"We’ve been able to give out these cards to people at community events, especially during the holidays. We have a lot of food drives and events such as Toys for Tots, so being able to give back to the community in a tangible way is important to our council. We’ve also been promoting it via our newsletters and flyers. We also have video advertisements at the local DMV and the movie theaters promoting the rewards that our residents can earn simply by shopping locally." Michael Flores, Coordinator for Economic Development for the city of Lancaster, CA
Over the time they’ve used Open Rewards, the city of Lancaster, CA has seen incredible impact. They’ve registered over 1,300 users to the platform and have over 400 participating businesses. The city has distributed $59,407 in rewards, but has seen $210,300 in total economic impact—bringing a 4x return on investment (ROI) for the program.
These results are quite impressive and would be impossible to track without a digital solution like Open Rewards.
From Small Business Saturday to everyday
In Arlington County, VA, Small Business Saturday has always been an important opportunity for its residents to shop local. However, in 2022, they used the occasion as a platform to launch their own rewards program—rewarding shoppers with 5% cash back with each shop local purchase.
"The Open Rewards program is one of BizLaunch’s many innovative tools that small businesses can leverage to help them." Tara Palacios, BizLaunch Director, Arlington County Economic Development
Since that launch, they have seen over 2,700+ transactions using Open Rewards in Arlington County. They’ve distributed over $6,400 in rewards and seen a $135,701 total economic impact—bringing a 21X ROI. Powered by Arlington Economic Development’s BizLaunch, the director loves that the program is a win-win.
“This effort not only helps Arlington’s small businesses, but also allows the consumers to earn cash back rewards by supporting them. In today’s economy, when everyone is watching their spending, this effort is a win-win for businesses and consumers.” Tara Palacios, BizLaunch Director, Arlington County Economic Development
Realizing the economic impact of a shop local program for your community
Both Arlington County, VA and Lancaster, CA utilize Open Rewards. Open Rewards makes it incredibly easy for residents to be rewarded for their purchases—they sign up for free with the app, make a purchase and rack up rewards by shopping like they normally would—whether debit, credit, cash or EBT cards.
70% of the users of Open Rewards agree that Open Rewards has directly influenced them to shop local. The tool helps business owners, too, and its impact is easier to track because it’s a digital solution.
Shop local campaigns are great tools for Economic Development teams to highlight their local business, support their local economies and reward their residents—it’s even better if you can easily measure the economic impact of a shop local program.
If you’re interested in using Open Rewards to power your city’s shop local campaign, schedule a demo today.