How the Coronavirus is Impacting eCommerce

By:
RAKUTEN SUPER LOGISTICS
Mar 12, 2020

There is no doubt that the coronavirus has impacted eCommerce worldwide, and its repercussions have only begun. It's interesting to note that for a select number of retailers, the threat has been a short-term gold mine, while for the bulk of retailers it's been more like a nightmare. Let's delve into coronavirus' impact on eCommerce and see what steps can be taken to protect retailers’ interests.

THE GOOD, THE BAD, AND THE UGLY

A notable increase in demand for things like bottled water, cleaning products, hand sanitizer, face masks, and even toilet paper has surely boosted some retailers' sales, as shoppers are in a frenzy to disinfect surfaces and stockpile common household goods. It's also made shopping online more popular than ever because most people would rather avoid in-person shopping for now. This has resulted in a temporary surge in sales.  The good news for companies like Clorox, Purell, and even Netflix is that people want to disinfect everything and stay home.

However, whatever positive impact the scare has had, there is more bad news to go with it.  The extra demand has created a multitude of issues even for well-equipped businesses. Retailers are seeing increased demand, but delivery capacity is bogged down with the influx of unanticipated orders. Unless businesses are leveraging a 3PL with the ability to scale at a moment’s notice, it can be difficult to catch up to unexpected spikes in volume.

Of course, retailers have widely experienced problems fulfilling orders that require anything shipped from China. Not only are factories overseas effectively shut down, but in many cases, communication has become increasingly difficult...or even nonexistent.  Restart dates and shipping estimates are elusive at best. What information is available is certainly not concrete and often not reliable.  

Along with these challenges, retailers are seeing fear from consumers regarding receiving items that come from China. There are some concerns that are reasonable, and plenty of unfounded fears that retailers are being forced to sift through and respond to. Many have been afraid to receive packages from China for fear of the virus living on surfaces. The CDC has stated in their 'Frequently Asked Questions' section of the website: "Because of poor survivability of these coronaviruses on surfaces, there is likely very low risk of spread from products or packages that are shipped over a period of days or weeks at ambient temperatures, refrigerated, or frozen temperatures." which should allay concerns.

WHAT'S A RETAILER TO DO?

1. Be Informed

It's important to follow the latest news in order to respond to current problems and anticipate issues down the road. Staying informed will help keep companies one step ahead and ready to respond to concerns as they arise.

2. Make the Changes You Can  

Much of the impact will be out of our control, but there are some measures that can be taken. Many retail companies haven't felt the impact in a huge way yet, but they know that it's likely. Now is the time to find ways to compensate for the loss of sales through strategic moves internally. This could include decreasing cash outflow as well as looking for possible alternatives to meet the demand for supplies, as least until this passes. There is still time to get creative about planning and hopefully stave off some of the negative impacts.

3. Communicate the Plan

 A good plan is a plan that everyone understands. It's important for retailers to not only plan at the top but also imperative to communicate with and prepare employees at the ground level. Remember, these are the ones who are interacting directly with consumers. When customer service representatives receive calls with questions, or sales managers have concerns brought to them, they shouldn't have to come up with their response off the cuff. This should be covered ahead of time by educating employees about what measures are being taken to correct any problems or reassure shoppers that inventory is safe.  

4. Stay on Top of Suppliers 

This is key, but not always fun. Getting information in times like these can be like pulling teeth, but it's necessary to stay on top of communicating with all suppliers and partnerships on the status of orders, supplies and shipping updates. This will help with planning and with customer service in keeping the most up to date and accurate information.

5. Reassure Consumers as Widely as Possible

Remember that retaining customers long after the threat of Coronavirus is over is the goal, so it's important to make shoppers feel as calm as possible. In other words, they want you to hold their hand through this. One way to do this is to make the information they need easy to access. Consider a banner on webpages with the most up to date shipping estimates or updating the FAQ section of websites to include information surrounding the Coronavirus and its effects.  This will not only save retailers time and resources in answering questions, but it will also cause customers to feel secure, which makes for a loyal customer base.

6. Redirect

The upset in the markets will cause some departments to be less busy, while others, like customer service, will be pulled on. Rather than wasting resources, consider temporary alternative placement within. During the outbreak, there may be less need for shipping managers and more need for answering emails. When it's possible, resources can be saved through this type of redirection.  

ALL IS NOT LOST

The Coronavirus outbreak is causing harm and certainly has already had a significant impact on retail, much of which is out of our hands. However, retailers are not totally without strategies that help ease the pain. By implementing creative strategies, we can position ourselves to come out on top.  It will take some time, and no doubt a lot of patience, but this too shall pass. Perhaps the most beneficial thing a company can do in times like these is to keep an eye on the bigger picture, knowing that most effects will be temporary and better days are around the corner. Hopefully, when it is all said and done retailers will be more prepared for any future events.

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