There’s a big question for business leaders to be evaluating right now: How certain are you that the popularity of e-commerce will continue after the global lockdown is over?
The popularity of online retailing was rapidly on the increase before the advent of COVID-19, reaching 16% of all retail sales in 2019 — and expected to rise further.
Since the pandemic reared its ugly head, demand for online shopping in FMCG categories like groceries, over-the-counter pharmaceuticals and clothing have sky-rocketed.
But what happens when life goes back to “normal”? Will online shopping habits that formed during the lockdown continue afterward and become long-term behavior?
The early 2000s SARS crisis can teach us about online shopping behaviors.
The SARS crisis in China in 2003 became a real watershed moment for the likes of Alibaba, which was on its way to becoming the e-commerce behemoth that it is today.
E-commerce was still in its infancy when SARS struck China and threatened a global pandemic. The question became: Would Alibaba and other e-commerce players like it survive?
But Alibaba put its neck out during the lockdown and boldly continued to innovate, and it would reap the rewards of its boldness. Chinese consumers confined to their homes turned to the internet to order items.
This way of doing business and buying products caught on in a big way. And, as people looked to source goods, Chinese suppliers had little choice but to heavily invest in online marketing on platforms like Alibaba.
The popularity of online shopping ballooned during SARS and, importantly, continued afterward. What might have been temporary new buying and consumer behaviors solidified and became permanent.
Management is about evaluating probabilities.
Right now, it is highly probable that the current crisis is going to amplify an already existing trend. The likelihood is that people who had been reluctant to shop online before the COVID-19 quarantine will recognize the benefits of continuing to shop this way in the future.
But — and it’s a big but — that doesn’t mean that they will shift completely. It might be that some people aren’t satisfied with online shopping. So how can organizations adapt to this new uncertainty and mitigate risks when it comes to planning their future sales strategies?
Retailers must embrace the omnichannel.
Research conducted by AdColony relating to changing consumer behaviors during lockdown shows that nearly half of all the people surveyed would shift to more online purchases in the future. On the flip-side, more than half of the people surveyed said they are keen to shop in physical stores again.
So, how do you strike the right balance?
Taking an omnichannel approach — that is, “a sales approach that provides the shopper with an integrated shopping experience across all channels (physical and digital)” — is no longer an option for retailers, but an absolute necessity.
Retailers should be thinking about how they can seamlessly combine their physical and digital channels to create the best possible omnichannel experiences for their customers. For instance, how can brands use customer data generated online to tailor personalized customer interactions in-store to deliver an incredible experience?
One shining example is digitally native lingerie brand Adore Me, which, though it has a very strong online presence and e-commerce store, offers an exclusively in-store body scanner that shoppers can go into to get an idea of the underwear or sleepwear that will suit them. Adore Me’s staff are trained to be able to then offer the customer a consultation on the best options for them based on the measurements provided by the scanner.
Sporting goods retailer Orvis is another brand that enhances shopper experience through the omnichannel. They know that its target audience of affluent over-50s understands the benefits of e-commerce tools but prefers to shop in-store. To combine the strengths and benefits of physical and digital channels, Orvis gives its employees tablets with pre-installed CRM and e-commerce tools. Employees can use these tablets to order out-of-stock products and bill customers for sales (both in-store and online). The tablets also allow staff to show customers similar products and make recommendations. And the tablets tell employees whether someone entering the store is a new or loyal customer.
For this omnichannel approach to be successful, Orvis has had to ensure that its employees have developed the skills to allow them to play their part in enhancing shopper experiences. This can only be achieved through capability building (or training).
Management has to use the power of probabilities to work out what to do next and plan a way forward for their organizations. They must also use tools at their disposal like data and analytics to monitor consumer behavior.
To strike the right balance in the future, retailers should be thinking about how they can seamlessly combine their physical and digital channels to create the best possible omnichannel experiences for their customers.
As with all new approaches, staff will also need to be given the skills and build capabilities that will allow them to adapt to the omnichannel and play an active part in greatly enhancing these new shopping experiences.