Black-owned businesses gain confidence
Support of Black-owned businesses has slowed since digital campaigns sparked a surge last year after George Floyd's death, but some owners say they now have more confidence that they can continue to grow.
Why it matters: News outlets, social media and e-commerce platforms rushed to find ways to support the Black community, including the promotion of Black-owned businesses — but it was never clear whether that support was authentic or whether it would last.
- Interest in finding “Black-owned businesses” peaked on Google during the first week in June of last year and has seen spikes every few months since, with the last being in February of this year, during Black History Month.
- Yelp, which compared "identity attribute" terms such as "Black owned," saw search interest grow by more than 12,000% in June year-over-year. Growth is still high now, but not as dramatically high — up close to 480% as of March, the company tells Axios.
- Yelp reviews of Black-owned businesses grew more than 600% in June and July year-over-year and growth is still high at over 190%, compared to 76% growth in review of women-owned businesses and 58% growth of Latinx businesses, as of February this year.
What they're saying: Andrea Ballo, an artist, said she received many inbound commission and sponsorship requests for her artwork and designs during the first two months after Floyd's murder.
- "It was a surge of companies scrambling to look for Black content creators," Ballo tells Axios. “Once things fizzled down, I saw that those opportunities dried up as quickly as they came.”
- Ballo says she saw another wave of requests during Black History Month, and "now they are switching gears to the AAPI community. It can be easy to categorize that as performative — whoever is oppressed the most gets the funding. It doesn’t feel very genuine.”
On the other hand, individual customer support of her stationery business, Coco Michele, has remained strong.
- “In June, you can see the trajectory of our business shooting up. It’s maintained at that same level.” Ballo says she was able to leave her corporate job at Macy’s due to her sales and profits tripling.
Yes, but: Ballo attributes her continued success to focusing on merchandise that aligns with her own mission, and not just with the Black Lives Matter movement.
- Danielle Oloko of Mocha Design Studio in Las Vegas said she sold thousands of her empowerment and Black-culture inspired apparel and shirts for women after being featured on Facebook, Instagram and BuzzFeed. “Everything was back to 'normal' by September 2020,” she tells Axios.
- Anthony Edwards Jr., co-founder and CEO of EatOkra, an app that curates Black-owned restaurants, says he's seen support continue: Downloads of the app have grown from 100 per week before June of last year to 300 a day now.
- "We're going to last longer than this trend," Edwards tells Axios. "We feel more confident that we're speaking to more people now."
By the numbers:
- In the U.S., there were more than 2.5 million Black and African-American owned businesses as of the last Census data.
- During the pandemic, the number of Black and African-American business owners dropped by 41% — the highest among racial and ethnic groups.
- And because nearly 95% of Black-owned businesses are non-employer companies, that made it difficult for them to receive PPP loans.
The success has been bittersweet: Dayna Atkinson of Detroit runs vintage clothing brand FYRE VINTAGE. She says even though she's grateful for the increased visibility — her Instagram page has grown from 250 followers to nearly 14,000— “I hated why.”
- Her FYRE GIVES initiative donates 10% of her profits to women in need in her hometown of Detroit. “I was uncomfortable with my new success and I had to find a way to give back.”
The big picture: Business owners like Ballo and Atkinson now feel more confident about their brands.
- “I have no doubt about the success of my brand. It has been almost a year since the initial surge and my shop continues to grow,” says Atkinson.
- “My customers are buying because I have created a brand and product that they like and feel connected to not just because I am a Black-owned business.”
- Ballo is optimistic: “Even if capital opportunities don’t last forever, if we as marginalized groups put our heads together and get access to knowledge and capital and build sustainable growth ... there's opportunity for us to come out of this much stronger as business owners."
What to watch: Organizations like the Fifteen Percent Pledge are working to ensure long-term, systemic changes to support Black-owned businesses.
- Since its launch a year ago, the non-profit has already worked to get 23 major retailers, such as Macy's, Bloomingdale's, West Elm, Gap and Madewell to commit to devoting at least 15% of shelf space to Black-owned businesses for at least four years.
- "We've moved $4 billion of opportunity to Black businesses," LaToya Williams-Belfort, Executive Director of the Fifteen Percent Pledge, tells Axios.