As one of the most talked-about events of the decade thus far, COVID-19, more commonly known as the coronavirus, has impacted the entire planet. How will this virus affect e-commerce - will it be a threat to the industry? Insiders weigh in.
Retailers relying directly on supply chains, international shipping and last-mile delivery have seen the struggle to keep afloat while the virus rampages. Let us take a look at how this medical emergency has impacted e-commerce, and if there are any secret benefits to the online retail industry from this outbreak.
The Big Threat?
Several issues are surrounding this virus, health aside. What will be the most significant impact for retailers during this time? According to Charlie Youakim, CEO of Sezzle, it’s the supply chain.
“The main impact from Covid-19, at this stage, is on the supply chain,” Youakim tells Power Retail. “This disruption could impact the timeliness of customer deliveries which, unless handled carefully, could lead to customer dissatisfaction. Keeping consumers informed and up to date is the key to mitigating that. Most people are understanding and will be lenient if they are fully aware of the circumstances.”
Will E-Commerce Boom as a Result?
COVID-19 has currently infected more than 40 Australians across the country, of which 21 have recovered. Two have passed away from the virus. As such, those who are infected are told to stay inside and quarantine themselves until they’re free from the virus. In an effort to prepare for quarantine, essentials such as toilet paper and pasta have been flying off the shelves in supermarkets. In the long run, what does this mean for retailers? Should they prepare for a massive drop in foot traffic? Will online retail boom as a result?
“It’s only natural that those avoiding human contact would rather shop online than visit a store and so we absolutely do think that e-commerce platforms will see a boost because of COVID-19,” explains Youakim. “With the potential of government-imposed quarantines, we see this trend extending for some time.”
Even the adverse side effects fo this virus have their sunny sides, says Shuey Shujab, CEO of Whitehat Agency. “The negative impact on e-commerce is actually on the supply side. Due to a lot of factories being shut in China, many e-commerce businesses are finding it hard to replace their stocks. E-commerce businesses that have products made are Australia are booming right now because of increased demand and no disruptions in local supply chain.”
The Rest of the World Reacts
COVID-19 is currently active on every continent on the planet except Antarctica. More than 98,000 people have been diagnosed with the virus, of which 51,000 have recovered.
In South Korea, there are more than 5,600 reported cases; Italy currently has more than 2,500. Iran has also experienced a rough ride with the virus, with just under 3,000 diagnosed.
On a global scale, retail will likely be impacted by COVID-19. This will primarily influence the supply chain. “We’re a global economy, so most e-commerce platforms are being impacted in a similar way which, at this stage, is focussed around supply chain,” Youakim says.
The world reacts to COVID-19 – Vladivostok, Russia.
How Long Will It Last?
It’s hard to say, really. With no cure for the virus, it may be hard to determine when the end is coming our way. “While the data shows that new cases are being outstripped by recoveries, which would point to a near term recovery, this seems to be an unprecedented event at this stage which means it’s very hard to predict whether it will escalate or ease in the next few months,” Youakim tells Power Retail.
In the Meantime
There’s no definitive answer for retailers and the general public regarding the end of this virus outbreak. As such, the world has to sit tight and make appropriate changes to reflect the current environment.
For online retailers, there are a few steps to take in order to regain confidence from consumers during these tines. Shuey Shujab has offered some advice for e-commerce companies in the meantime.
Switch Product Offering
“Switch focus quickly to products in their inventory that they have more stock for or products that aren’t made in China. This switch is easy and cost-effective to do with digital marketing. It’s possible to build a paid media campaign within a couple of days to start promoting this alternative line of products via digital channels,” Shujab says.
Connect with Local Suppliers
“If there’s not an existing relationship with a local source it’s a good idea for businesses to identify providers of similar quality products from factories in countries not significantly impacted by COVID-19, with a particular focus on suppliers in Australia. This would have the double benefit of having a positive impact on Australian manufacturing,” Shujab suggest.
Move From Face-to-Face to Online
“Businesses that have a focus on face-to-face learning or networking can protect their revenue by running online webinars or courses instead of delivering face-to-face conferences, trade shows or promotional events. With a clear digital strategy this can be very effective in making up for the leads those businesses would have otherwise generated at such events,” Shujab tells Power Retail.
“Be as Digital as Possible”
As the virus continues to roam, Shujab suggests that sticking to an online strategy is the safest bet for retailers. My suggestion to businesses, in general, would be to start transitioning your business to be as digital as possible, as soon as possible,” Shujab tells Power Retail. “Especially those retailers who don’t yet have an e-commerce strategy for their business – they will be gone soon if they don’t adapt to the rapidly changing business landscape.”
What’s Important to Remember
On a global scale, the world will recover from this virus. Retailers need to continue with the ‘business as usual’ mentality. “It feels like the economy can pick up the flu, just like an individual. Most of the countries out there are taking the right steps towards recovery which has us hopeful that we will have our healthy economy back soon,” says Youakim.
Sticking to digital strategies, enlisting in local suppliers and staying transparent with supply chains are the best way to prevent the virus from infecting your e-commerce platform.
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