Wednesday, April 15, 2020

How the Online Retail Industry Can Adapt During COVID-19

Thomas John, Senior Director and Commerce Practice Lead
Strategy / Technology

The COVID-19 pandemic is creating unprecedented challenges for online retailers. The long-term impact on ecommerce is unknown. However the short-term impacts have caused significant changes across the spectrum from buyer’s purchase habits to warehouse management and logistics. Retailers with physical footprints have been particularly hard hit from this pandemic - from store closures, inventory replenishment and delayed shipments. This blog looks at the variety of ways retailers have adapted their businesses during the COVID-19 pandemic.

As the continued threat of the pandemic looms, we recognize the difficulties that the retailers are facing in the pivot of their business strategies. The surge in online shopping has exposed vulnerabilities in various areas from digital readiness to the robustness of supply chain strategies. Taking all of this into consideration, we have put together a quick list of best practices you can implement. 

Online Retail and Commerce: Best Practices for Immediate Consideration

Leverage what is still working within your business: If part of your store can still remain open (store room or warehouse), utilize it as part of your fulfillment strategy. This takes advantage of your existing inventory in the store and can be handled with limited staff. 

Local-first approach: In these conditions, pay attention first to the local community before considering shipping orders to other cities or states. You can leverage delivery services that are currently running to augment the delivery process. 

Provide options to your customers to both place and receive their orders: With social distancing being practiced across the globe, transform or create new services that allow your customers to place their orders online and provide curbside pickup services. For retailers who offer pick up in-store (BOPIS) consider moving to a model of pick up at-store (BOPAS) with above mentioned curbside services. This model can also be run with a limited staff, and yet provide critical service to your customers.

Reimagine your returns & exchange strategies: Consider a shift in your returns & exchange strategies by extending timelines. This will not only make your customers happy, but also help your fulfillment locations which might now be managed by a reduced staff. In addition, if part of your store is open, consider using it as a temporary fulfillment center to accept returns. 

Clear messaging to your customers: As the pandemic took hold and forced the closings of non-essential businesses, online retailers have posted COVID-19 related message on their sites. Most of them have been in the form of a banner on the homepage to alert and inform their customers of how the retailer was dealing with the pandemic and efforts to support both their customers and employees. For example: Target has been closing their stores everyday at 9PM to better replenish and deep clean their stores. This is communicated via email and online messaging.

Most retailers are cautious and are taking some actions to evolve during this time. More than half the retailers expect some revenue implications and others believe it is too early to quantify the long-term revenue implications for 2020. What is clear is that the COVID-19 pandemic will have many consequences for both consumers and retailers. This is truly unchartered territory for all of us, but it is also an opportunity to learn, evolve and grow.