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The COVID-19 that originated from China kept the Chinese people as a hostage for the firth month of the year. But now the spread of this disease went global & most of the developed and underdeveloped countries are lock downed to fight against corona circulation.
Till now,the widespread pandemic coronavirus has affected many businesses worldwide. Due to the profound effect of this crisis are significantly impact supply chains of many brick-mortar and eCommerce industries across the world. The eCommerce stores are also not left out from the toxic effects of this crisis. Well, some eCommerce sectors have seen a rise in the number of shoppers for a short-term period, but what will be the long-term scenario of the same is yet to be seen.
In this article today, we are going to discuss how this global pandemic has impacted the eCommerce industry. There are some questions that most business owners seek, like what will be the impact on the holiday season? And what are these steps for eCommerce brands from countries that have not yet been affected by the virus so they can churn in some profits?
“Consumers are switching to online eCommerce shopping“
Due to the outbreak of COVID-19 in mass numbers, consumers are staying home to abide by social distancing law to avoid going out in public places. It creates a surge in the traffic for retail eCommerce brands. Econsultancy says that more than 50% of Chinese and more than 30% of the Italian consumers have admitted that they are using eCommerce sites more frequently than ever to order various products.
In one their survey they found that more than 70% of marketers who believe that there will be surprisingly increasing the usage of eCommerce and online shopping due to the coronavirus pandemic. Apart from eCommerce sectors, food and grocery are going to be the most beneficial sector. Also, the rush to grocery shops have increased over 10% last month and will rise for upcoming days as well, with an 11% increase in the transaction recorded at the start of the 3rd month. This is due to all the people are panic buying stuff that is necessary for them to survive.
A global survey conducted by Ipsos found that people are buying food and groceries from online shops in the majority of countries than they usually do. And this is set to rise as people from other countries are in a similar situation of isolating themselves. As Shelley E Kohan, writer at Forbes, predicts that people are more interested in stock much-needed goods in their homes to survive and are less likely to spend on fashion merchandise.
The digital video streaming platform like Netflix, Prime Video, Now TV, etc. will see a rise in their Year-on-Year subscription rate. This is also one of the effects of social distancing and people mostly staying at home. The global subscription rate for Netflix video streaming service will grow to 30.9% against previously predicted 29.9%.
While considering all these things, there is a rise in the eCommerce retail business but for the short-term. It is because, for the long-term, the stock and supply chain issues are also going to rise. A quick investment is necessary to meet the demands while ensuring not to promote the panic buying situation. Various Chinese and UK eCommerce retailers are creating extra jobs to meet demands created from the coronavirus.
The Omnichannel Opportunities:
The closure of brick and mortar retail stores and less number of people coming out due to the coronavirus risk will create a significant dent in their revenues. It creates an opportunity for omnichannel retailers to focus and invest in eCommerce. These closed stores, using a smart PR strategy, can increase traffic and sales for their eCommerce store.
While there are challenges for in-demand eCommerce retailers such as delays and disruption in supply and deliveries, which can affect the reputation of brands and loyalty of consumers for short and long terms. As the situation is not constant and changes continuously, these issues will be dealt with a rolling basis.
Over 75-80% of Suppliers see Disruption:
The eCommerce companies will go through the disruptions in their supply chain, product delivery, and inventory management due to the mass outbreak of coronavirus. As per one poll of the Institute of Supply Chain Management conducted on 600 supply chain managers found that more than 75 to 80% of companies have experienced disruption in high magnitude due to transportation restriction levied out of the risk of coronavirus outbreak. The Digital Commerce 360 institute says that 16% of these companies have revised their revenue goals down by 5.6%. Also, the travel and hospitality industry will see a 15% Year-on-Year decline in growth.
Huge demand for safety material and products:
Due to the increase in the global cases of the COVID-19, companies have to deal with the big demand for safety-related products such as N95 masks, hand sanitizer, rubber gloves, and other safety-related products. The supply situation of these products is the same as other products and companies are lacking behind in fulfilling them. But they are working effortlessly to mitigate the current and future demands with a sufficient supply of alternative options available. The traffic on the healthcare site increased whopping around 25% at the start of the 3rd month with a spike in sales around 27% in the last week of the 2nd month said ContentSquare.
Will the coronavirus impact on the upcoming holiday season?
The holiday season is that time of the year when people shop more than what they do on regular days. With a consistent rise in the number of cases of COVID-19, eCommerce retailers will have another advantage during Holiday Seasons. Even if the coronavirus starts to dissipate within 6 months, but it has chances to come back in fall and may spike the holiday sales. Even if that does not happen, once this shopping behavior gets into the system of shoppers and consumers, they are more likely to buy most of the stuff online from then on. This will raise the percentage of sales even after the holiday season is over.
Meanwhile, many experts have forecasted that there will be a spike in the sales of grocery items along with other items such as beverages and liquor. So, the demand is going to explode in the coming months, but the question arises that can they mitigate these demands with sufficient supply?
Corona Virus Action Plan for eCommerce Stores:
Most of the companies and corporates have a team for risk management, which is dedicated to deal with the disruption created in similar situations like coronavirus outbreak. However, there are specific steps you can take to limit the coronavirus impact for your eCommerce store.
The steps involve monitoring the whole situation from the ground with your suppliers, maintaining the relations with your suppliers and consumers in these difficult times, keep yourself updated with regulations nationally and locally to keep your business running.
Other short-term measures you can take are…
- Increase the inventory of your store because the supply chain will take time to be restored again.
- Take the necessary steps to maintain and manage the sales run rate such as adjusting pricing to slow down the sales. This is essential so that you don’t run out of stock and have a sales order at a rate you can handle.
- Prepare FAQs and support team for handling customers queries, generally relating to the delays in delivery.
- Expand your supply base because relying only on one supplier may put your store’s product out-of-stock. Looking at the statistics and current trends, it would be a wise decision to start looking for multiple suppliers.
As we have seen how this pandemic crisis has impacted many eCommerce business sectors and will continue to impact until it ends. Some eCommerce sectors have been benefited from this outbreak such as food and grocery, video streaming services, medical, etc. But there are also sectors like the travel and hospitality industry, which is the worst-hit from this global crisis. The long-term impacts of the same are yet to be seen in the whole eCommerce industry. We have also discussed what should be your action plan when this comes to hit your market.
Lastly, If your business is affected & hit by a coronavirus and you are looking for a way to get through this, then consult an eCommerce expert. Many eCommerce companies are facing this situation for the first time or don’t have a dedicated team for preparing the action plan. At this time, our experts will advise you on how to handle it better and come alive. In the wake of the situation, the team of Mconnect Media & our Magento Experts are working tirelessly from home to meet your deadlines. We are ought to provide you the same quality work even working from home. Once you send a request our expert will get in touch with you within 24Hours. So, Hire our Magento Developers now.
Stay home, Stay Safe!
