The Top 10 Ways Small Businesses Can Make Money This Year Experts share the small business trends they believe will make a difference to entrepreneurs' bottom line.
By Rachel Davies Edited by Frances Dodds
This story appears in the March 2025 issue of Entrepreneur. Subscribe »
There's plenty of financial uncertainty this year, with inflation still dogging the economy, and small business bakruptcies on the rise. But there are also reasons to be optimistic about small businesses profitability, including innovations in AI and evolving business models. Here, we talked to a range of experts to learn about the top trends driving small business sales this year.
1. Direct-to-consumer will be a bigger piece of the marketing pie.
For years, brands with new products had a simple playbook: Drive sales on Amazon. 1. That's where customers were, after all. But now, small businesses are renewing their focus on direct-to-consumer (DTC) strategies, instead of trying to win the Amazon game. "There is huge, huge competition on Amazon, and new entrepreneurs are finding it's really hard to invest all this money to be in the first pages," says Hope Khoury, a cofounder of Go Vertical, which has worked with over 250 inventors on developing their products and launching their small businesses. "They are relying on [other] sources so they can boom and have brand awareness elsewhere."
In order to incentivize more DTC sales, small business owners are getting strategic about differentiating what they offer on their own sites versus what's offered on Amazon. For example: Tubby Todd, a small business that makes bath products primarily for babies and children, only offers bundles on Amazon — but on its own website, it also offers other opportunities.
"Amazon is for a specific Tubby Todd customer," says Tubby Todd cofounder Andrea Faulkner Williams. "If you want to buy the bundles with two-day shipping, you can do that. But if you want to get the products at a slightly lower price, you might have slower shipping, and you can get loyalty points and other limited-edition things that are only on TubbyTodd.com." Differentiators like these will draw more customers to shop directly with their favorite brands in the coming year.
Related: How Small Businesses Can Score Big Marketing Wins Without Much Money
2. Micro-influencers will make a bigger impact.
Influencer marketing is huge, but huge influencers aren't always the best marketers. Their audiences are too broad, and their pitches can feel inauthentic. "That's where micro-influencers crush it," says Makena Finger Zannini, founder of The Boutique COO, a business advisory and social media strategy firm. "The more authentic, the better. That's what people respond to, and you see that in analytics on social media success in the last year or two."
Michael Michalowicz, a speaker, consultant, and author of eight books on small business, agrees. "The micro-influencer knows the language of their community; they can speak with true experience and authenticity," he says. "The macro-influencer doesn't have that intimacy."
Faulkner Williams prioritizes working with influencers with less than 100,000 followers for Tubby Todd content. "We always look for the mom and dad who have, like, 5,000 followers, who are working their heels off to create the best content," Faulkner Williams says. "They'll send you a Dropbox full of content, and they're going to be so much more motivated than [a big-name influencer]."
Having trouble finding the best micro-influencers to work with? There are now marketplaces to help you do it, like Kale and Hummingbirds. Both make it easy for small, hyperlocal creators to find your brand and partner with you.
3. Strategic offers will replace extended discounting periods.
Remember the 2024 holiday season? Our inboxes were full of discount promotions, with every brand running earlier-than-ever Black Friday/Cyber Monday promotions. And what good did that really do?
"A discount code encourages the immediate transaction, but it dissuades loyalty," Michalowicz says. "Groupon is probably the best expression of that. If I want to use Groupon, it's not like, 'Oh, I'm trying to find the local plumber to be my plumber forever going forward.' It's because I have a plumbing project and that's one of the cheapest deals. That's the mentality people are going in with [when using a discount code]: not seeking a relationship, but seeking a price."
This year, we may see a correction. Finger Zannini predicts that, instead of relying on seasonal discounts, small businesses will start incentivizing customers with free add-ons — and they'll do it throughout the year. That could mean offering a bonus item to DTC buyers, or a service enhancement to certain customers. "I think offering more value keeps your credibility, but still incentivizes people when you want to incentivize them," says Finger Zannini. "I've seen quite a few clients looking into that and switching away from discounts."
Tubby Todd's Faulkner Williams agrees, and is approaching her own promotions with more focus. On Instagram, her brand posts monthly calendars showing exactly when promotions and new products will drop. For instance, in November, Tubby Todd had a four-day window for the Black Friday sale at the end of the month, plus three giveaways and one day where customers would receive a gift with their purchase.
Related: 4 Advanced Marketing Tactics for Small Businesses That Actually Work
4. Bold ideas will counter the digital noise.
AI slop is everywhere: on your social feeds, in your inboxes, and in your web searches. So how can a small business break through to customers? Michalowicz has an answer: Surprise them.
"People want something that's different," Michalowicz says. "So a restaurant that does a goth theme is going to be far more successful than Macaroni Grill. Any brand that really leverages their own unique style, where people can use it to express themselves, will find success."
How can you find ideas that stand out? Michalowicz recommends finding your answers by asking: How are you unique? And how does your uniqueness align with what makes your customers special? "The new thing is to understand your own idiosyncrasies, desires, interests, and passions," he says. "Then see how that can serve communities just like you." For example, in-person businesses can offer spaces for people to immerse themselves in a unique experience. Online, businesses can offer eccentric or custom goods that allow people to show off their uniqueness.
5. Personalization will drive loyalty.
Imagine that you run a local HVAC business. You adopt an automated system which sends clients an SMS reminder about two hours before your technician arrives at their home. "A system does this, but it feels like you're being given good service," says Barry Moltz, an advisor who's hosted the Small Business Radio Show for 15 years.
This may sound simple, but it's an important way that AI and automations can help small businesses grow. "Think about how well Amazon does this," Moltz says. "I log on, it greets me by name, it knows what I bought before. Technology allows even the smallest businesses to do that now."
Michael Khoury, the second cofounder of Go Vertical, agrees. "This year, we will witness more AI introduction into everything that we do in business," he says. The way he sees it, this can have a leveling effect — allowing small companies to engage meaningfully with more customers, even if they have a fraction of the staff that their larger competitors do. "It's going to help these small business owners get their foot in the door."
6. Communities will be monetized.
For years, businesses were told the same thing: Build your community! This meant many things, from cultivating a social following to hosting recurring events. But now, Finger Zannini says, it's not enough to just have a community. "You have to monetize it," she says. It can be a big, but important, mental leap to go from caring about the size of the group to prioritizing its value. "There are some people who are still vanity-metric inclined, but a lot more people come to us and say, 'I want to understand how to convert the people that I do have [in my online community], rather than hunting for new people just for the sake of it.'"
The best way to do it, Finger Zannini says, is to connect directly with your followers, and offer unique products or services that'll make them feel special.
This isn't just for digital businesses or for social media. Michalowicz says it can work in retail too — by returning to some old-school tactics, like naming products after loyal customers or featuring photos of customers in the store. "If you have a deli shop, name some of the sandwiches after your customer," Michalowicz suggests. "'Mike's sandwich.' You know what sandwich I'll get all the time, and I'll be writing to my friends, 'You got to go get Mike's sandwich.' It's now part of my identity."
7. Sustainability will become an even greater focus.
Sustainability is not exactly a new trend, but as the effects of climate change become harder to ignore, experts predict that consumers will seek out even more sustainable product options. In 2024, The Economist Intelligence Unit reported a 71% rise in online searches for sustainable goods globally over the previous five years, and PricewaterhouseCoopers' 2024 Voice of the Consumer survey found that customers were willing, on average, to pay 9.7% more for sustainable goods.
"We are seeing this request more and more," says Hope Khoury. "Clients want to create a sustainable product and to be using sustainable materials. I believe what's driving this is the awareness. Inventors are becoming more and more aware of the impact of products that aren't sustainable and the value of products that are."
Michael Khoury anticipates that more products will be made with sustainable materials, as well as more refillable products. He also expects an increase in small businesses of all stripes reporting their sustainability initiatives to customers, like GoVertical has to inform its own decision-making. "Our own Sustainability Index forces us to consider the markets that we step into," he says.
Related: How New Businesses Can Create a Content Marketing Strategy
8. Subscription models will become more important in new categories.
Consumers are used to paying subscription fees, but only for certain products, like software as a service or recurring meal kits. But in response to years of inflation, many more companies have launched subscription models, drawn to the predictable recurring revenue and the ability to build ongoing customer loyalty. As a result, consumers are now willing to pay for many more kinds of subscriptions — and the list will continue to grow.
Examples abound. Customers are subscribing to more products, coaching, memberships, and beyond. Finger Zannini points to a small salon that specializes in hair and makeup for events. "They're killing with their subscriptions because people want that subscription," she says. The Khourys shifted their own consulting business to a subscription model. They used to offer a project-based pricing structure, but now offer ongoing services at a recurring rate. "Now that we have this subscription model, we have some sort of financial stability, which allows us to plan growth strategies easily," Hope Khoury says.
The key to offering a worthwhile subscription, these experts say, is making sure the value to your consumer is clear. If customers see the subscription as a deal — enabling them to lower their costs and increase their convenience for something they'd have otherwise spent more money and time acquiring — then you might have product-market fit.
9. Niche marketplaces will drive meaningful sales.
Amazon may be the e-commerce behemoth, but niche online retailers are thriving too — and becoming a legitimate source of sales for many small businesses.
For example: Faire sells goods from independent brands to retailers at wholesale prices. Sober(ish) carries nonalcoholic beverages. Poshmark offers fashion, home decor, and beauty products. When you sell your products through these marketplaces, Michalowicz says, you might reach fewer people — but they're more likely to be the right people, and you're competing against less noise.
"If I market a suntan lotion on Amazon, so do 10,000 others," Michalowicz says. "If I do it at the grocery store, now I'm talking about maybe 200 or 300 options. If I do it at the surf shop, maybe I'm talking 50," Michalowicz says. "Ironically, the least expensive marketing is for the more unexpected links, and I do see business owners looking for those."
Related: How to Grow Your Small Business Without Breaking the Bank
10. Quality products will move to the fore.
After years of chasing low prices, customers are more willing to spend on higher quality products. Finger Zannini thinks that consumers are more swayed by quality because they're feeling squeezed financially and being more thoughtful about spending on the whole. "I think people are so over the Shein era of cheap, fast things," she says. "If you can tell a good story about why your product is the best, and price it in a way that reflects that value, I definitely think people are spending on those types of items. It's because they're being more intentional overall about their spending."
Just making a quality product isn't enough, of course. This year, successful small business owners will be those who have also created compelling ways to communicate their product's unique attributes.
Michalowicz points to a recent success story — in a company that makes wool dryer balls. "You can go on Amazon and there's countless knockoff versions, but theirs is pure wool, and it sells for $5 more. It's basically double the price, and they are selling at a higher rate," he says. "We are seeing that the customer is more selective, because they're seeing their source of income dwindling. They're realizing, If I make this purchase now, I might not be able to afford it again three more times this year."
Barry Moltz adds, "There's always going to be those people who just go for the lowest price, but I think folks do pay for value and customer experience. I tell small business owners that you really should have a high-value product, because not everybody will buy it, but some of your customers will."
