Owning your digital present and future
The COVID-19 commerce lessons we have learned so far
The current situation facing every business is quickly reinforcing the critical importance of a strong digital commerce programme in times of business disruption. The lessons we have learned to date will continue to evolve as this plays out, and we will continue to adapt our thinking accordingly. Still, there are takeaways we can apply immediately and some longer-term strategies that can be planned now to minimise the impact of wide-scale disruption in the future.
Owned commerce channels
Own your digital commerce channels and own your destiny. This is true whether you’re a retailer, distributor, manufacturer or a FMCG brand that may only sell direct-to-consumer through niche-use cases. Adoption of digital-only or digital-influenced purchasing behaviours will accelerate going forward for both businesses and consumers. Mastery of these digital channels is a requirement not only for long-term success, but for brand preservation.
Digital impacts every sales channel. This is true regardless of business model, vertical or product line. For manufacturers, this means robust sales-team enablement tools complete with real-time inventory and customer-specific pricing, and self-service tools to enable replenishment, punch-out, configure-price-quote (CPQ), and even made-to-order (MTO) requests. For FMCG brands, this means seamless wholesale ordering and reordering, and strategically created, brand-centric direct-to-consumer sites. (No one needed to buy toilet paper directly from a manufacturer, until everyone did. Mechanisms to restock retail supplies have also fallen short.) Retailers must offer the best of both worlds once shopping patterns return to ‘normal’ and capitalise on click-and-collect capabilities, which have proven to be an equaliser against Amazon for brands that are doing it right.
Case in point, Best Buy is benefiting from their investments to offer one-hour pickup for online orders, with each store serving double duty as a fulfilment centre. Binny’s, a much smaller Midwestern beverage retailer, is able to offer the same 60-minute turnaround to their hyperlocal customer base. Home Depot can accommodate walk-in walk-out service with minimal human interaction, ideal for the situation we’re currently experiencing.
In the short-term, ensure sites can handle surges in traffic. Be transparent, especially in terms of the ability to fulfil orders. Look for quick wins and green-light stalled projects that can make incremental customer experience improvements. Longer-term, revisit your digital roadmaps to identify shortcomings in the current experience and gaps in capabilities. Then prioritise and begin moving forward on the next iteration of your digital experience.
At all times, but particularly times of crisis, brands must be exceptionally careful not to consciously – or unconsciously – seek to profit from a given situation. The potential long-term impacts outweigh any short-term gains. Even the perception of profiteering or price gouging can inflict irreparable brand harm. Trust is the underlying currency of business and it must be maintained over everything else.
With machine-learning programmes often tasked with implementing dynamic pricing based on data inputs, there is a risk of system bias resulting in punitive price fluctuations. Human oversight of merchandising programmes is a must.
No one could have predicted the hoarding of consumer staples that has affected supermarkets in the US and in other parts of the world. Or could they? Early in the outbreak, the Chinese government instituted buying curbs on consumer staples and issued directives to companies to ramp up production. That was almost two months prior to the virus being declared a pandemic. There are other issues that can be questioned about the Chinese response, but the shortages of consumer staples that we’ve seen in the US did not occur there.
World events can foreshadow local needs. No single company could have acted to prevent what happened here, but it’s clear that more proactive steps could have been taken, which would have lessened the anxiety felt by so many.
Logistics and fulfilment
Self-reliance has never been more important. Amazon announced that it is suspending its Fulfilment by Amazon Programme for third-party sellers for products deemed non-essential. This move is understandable given the need to keep up with customer demand, but it puts many Amazon sellers in a situation that will materially affect their businesses. This directly relates to the need for rock-solid owned commerce channels as discussed above. When it comes to logistics and order fulfilment, having a Plan B or using multiple 3PL vendors to lessen reliance on any one provider can help with business continuity in the event of any future disruptions.
We have seen some very thoughtful, useful and empathetic messaging from a number of brands and retailers.
Many of us have received emails from every brand and business with which we’ve ever done business. As these messages began to inundate our inboxes, many were simply echoes of each other. No real personalisation, no context as to whether we bought something six days or six years ago.
As each successive message became less meaningful, indifference began to give way to annoyance. And we know that was not anyone’s intention. It’s imperative for companies to be transparent and to keep customers informed, but mass mailouts that do not offer tangible value to the recipient can be counterproductive.
15 April 2020
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