In recent months, online shopping has gone from a convenience to a necessity as millions of Americans have taken shelter in their homes to ride out COVID-19. The shift has caused a much-discussed boon for large online retailers like Amazon, which saw 26% growth in sales during the first quarter of 2020.
However, it is not only the largest retailers with the deepest pockets that will survive this sudden shift in consumer behavior. The boundary between retailers that struggle and those that survive—and even thrive—is not as clear as it might seem.
In a recent report, Gartner revealed that 71% of even the most digitally advanced companies were still not helping customers with their most pressing problems. That leads to even higher churn, returns, and revenue loss than retailers experienced before COVID-19. So, what are successful retailers doing to stabilize their bottom lines during the global pandemic? Here are three strategies to help you successfully navigate today’s new retail reality.
1. Take sales online—even if you think you can’t
Less than a decade ago, we couldn’t imagine buying items like eyeglasses and mattresses online. The average consumer felt they needed to experience these products in person—they wanted to know how a frames looked on their faces and feel the firmness of a mattress. Well, times have changed.
To survive, retailers started rethinking which items could realistically be purchased online. Companies like Warby Parker and Purple paved the way for many of today’s retailers to bridge the online-offline gap by taking items that would typically be bought offline and selling them online.
Then there’s Vogue Fabrics, a family-owned fabric store outside of Chicago, Illinois. Vogue had limited online sales before the coronavirus. Most of their customers typically want to see and touch the fabric they’re purchasing. But when social distancing practices went into place, Vogue was ready to switch exclusively to online sales from its warehouse. The shift has led to swift sales for items such as elastic and cotton fabric for masks. Now, customers can even order sewing machine repairs online.
Retailers that want to thrive in a post-COVID world, no matter their size or years in business, must reconsider an online selling model if you haven’t already done so.
2. Online retailers should be prepared to scale
While online sales have skyrocketed for many retailers, many of them also weren’t prepared to handle the increase in traffic and sales. The ability to scale is now critical every day, not just on Black Friday or Christmas Eve. For example, some toy stores recently saw a 25% increase in sales as Amazon delays left parents with few options to keep their kids entertained (and out of frame on their conference calls).
Would your online store be able to support a sudden 25% increase in traffic—or would it crash and leave customers disappointed, annoyed, and probably never to return?
To thrive in today’s retail climate, retailers must invest in scalable technologies to help them prepare for unpredictable spikes in online business. This strategy likely includes upgrading to a flexible ecommerce platform that’s ready to scale with fast-changing traffic demands. And retailers new to selling online (or selling at a much higher rate than before) must also consider the security implications of shifting to online sales. Malware blockers, firewalls, and security certificates are critical to protecting customer data.
3. Adapt to consumers’ changing needs
Following Illinois’ stay at home order, Dearborn Denim owner Rob McMillan was unsure if his small business would survive. As a local shirt and denim factory, the state considered the operation to be non-essential ordered it to shut down. Rather than giving up, McMillan pivoted to making thousands of fabric masks a day, first for hospitals and later for sale to the general public.
Dearborn Denim isn’t the only manufacturer pivoting to meet the needs of customers, but it is a great example of how smaller businesses can make it work. There’s also door manufacturer Pella, which is now making face shields. Others like Brooks Brothers, Prada, Diego, and LVMH are shifting parts of their supply chain to create masks, mask bags, and other items that customers suddenly need.
Distilling companies, like Manifest Distilling in downtown Jacksonville, have shifted operations to produce thousands of gallons of hand sanitizer.
It may be cost-prohibitive for many companies to pivot their offers right now. But others that have already thought ahead and devoted time and budget to developing multi-channel offerings can leverage this shift while creating genuinely helpful experiences for their customers.
How will you thrive today?
No matter what type of items your company sells or at what volume, opportunities for stabilization or growth exist—even during a global pandemic. You just have to look for ways to shift to online sales, implement technology that improves scalability, and keep an ear to the ground, so you’re always offering customers the necessary things.
Above all, look for ways to help. As the country emerges from months of lockdown, customers will remember the brands that helped and sought to create a real connection with their communities.
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