Consumers have embraced ordering online for goods, services and food during the COVID-19 pandemic and many likely won’t switch back to their old habits. Swaths of late adopters also are discovering the benefits of the online experience of home delivery, or pickup in-store options, and may not go back to their old ways.
“Businesses will wake up to a new reality when the crisis subsides,” says Jean-Philippe Senneville, Director of Business Innovation and Technology at BDC.
Consumer behaviour changed abruptly due to necessity
“Many new consumer behaviours displayed on a massive scale during the lockdown will become permanent,” he says.
E-commerce is exploding on every metric right now. Within the COVID-19 context, consumers are looking for alternatives to traditional channels and are expanding product categories. Spectacular example: Statista indicates that “Online sales of household appliances, electronics, building materials, and DIY have rocketed since the outbreak of the coronavirus pandemic in Canada. Sales within this sector increased by 587 per cent between March 11 and April 14, 2020, compared to the same period in 2019.”
E-Commerce-ready businesses are cashing in, others are suffering
Companies with a strong online presence and a robust e-commerce infrastructure are currently experiencing revenue growth (or losing the least). Those businesses not prepared or that offer a poor customer experience will fail to retain customers.
For example, “If your site ranks low in search engines for relevant searches or displays performance issues, or your product catalogue is poorly managed, your business will not thrive in this competitive space,” Senneville says.
What if I cannot sell my products and services online?
Many retailers are investing in e-commerce capabilities and numerous manufacturers, service providers as well as distributors are turning to sell directly online.
What does it mean to companies whose offerings do not lend themselves to online selling?
“In times where trade-shows and traditional face-to-face interactions are off the list, a strong online presence that attracts traffic and converts to leads is more important than ever to offset the loss of offline sales,” adds Senneville.
“Investments and efforts in content marketing, analytics, search engine optimization, paid search, social media, etc. must continue and be supported by a capable platform.”
Short and long term strategy
The pandemic offers a critical opportunity to reflect and plan for the new business landscape. In times of great change, it is important to understand both the short term and the long-term implications of the economical, social and technological changes brought on or accelerated by COVID-19.
You need to consider: What is happening in your industry and markets? What changes and trends do you anticipate for your industry? How will your clients and suppliers change? What will your competitors do? How can technology help you adapt and thrive? Can a transaction platform and a more robust digital marketing infrastructure be part of the answer?
Here are some considerations:
Shipping costs, inventory management, and the logistics order fulfilment are only some of the challenges posed by e-commerce. The economics of online orders diverges from traditional “offline” sales and requires a different cost structure to be profitable. For example, lease costs, store payroll and upfront investment costs are heavier for a storefront retailer. The online e-commerce store will bear greater costs for web development, digital marketing and technical support.
Also, e-commerce giants have set the expectation of fast free shipping and free, easy no-questions-asked returns—it comes with a cost. And how will you pack, fulfil and ship your orders? What about customer service?
“It is not simply the products and services that you must get online. Many pieces of your business model need to come together to make it a profitable revenue stream,” Senneville says.
After you make sure you have your short term, a crisis management plan in place, create your action plan that reflects the short and long-term changes:
- Elaborate a strategy by involving your team and by seeking advice from seasoned e-Commerce experts.
- Lay down the changes you will need to make to the various components of your business and build a technology roadmap.
- Remember to communicate constantly with your employees and create your plan as you learn what works and what doesn`t for your company.
It is not too late
Many years of change have been compressed into just a few months. Instead of playing catch up when others come out of COVID-19, start planning now.
“Not only does e-commerce have the potential to help your company through the crisis, but it can position it for faster recovery and prepare it for the post COVID-19 economic reality,” concludes Senneville.
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Source: bdc