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Retail gains traction during coronavirus crisis thanks to e-commerce

byCharlotte Otremba |Apr, 2020 |Content,Culture

The retail sector is gaining traction during the coronavirus thanks to e-commerce. Empathetic brand messaging, digital advertising, and shifting to changing consumer needs will help retail grow online sales through the coronavirus crisis.

The U.S. Census Bureauannouncedthat total U.S. retail and food sales fell 8.7 percent from the previous month. But there is light: the worst hit may be over and ecommerce continues to rise.According to experts on eMarketer’s recent podcastSizing Up COVID-19’s Impact on Retail, a huge portion of retail may be completely shut down, but it’s those businesses who depend completely on brick and mortar locations for sales with limited to no ecommerce initiative. In order to survive, retail brands should shift messaging to empathy and helpfulness, drive traffic to their sites, adapt shipping capabilities, and above all: don’t go dark. Be prepared to bounce back once this is all over.

Boost in online orders:Adobe Analyticsreported a 25% boost in average U.S. daily online sales March 13-15 compared with March 1-11. In North America, the number of online orders for web-only online retailers were up 52% year over year in the United States and Canada for the 2 weeks of March 22 through April 4, according to an online trackerfrom marketing platform Emarsys and analytics platform GoodData. Revenue for web-only retailers in the U.S. and Canada was up 30% year over year for the period. This could indicate that rapid and massive efforts of retail businesses to shift their operations online as well as aggressive promotional campaigns started to pay off (“Retail sector is getting more traction”).

Use digital advertising to drive traffic to e-commerce sites:Pubmaticreported an 8% increase in ad spend in the shopping vertical and a 3% increase in style & fashion in March comparing the pre- vs. post-global impact of the coronavirus. Everyone is online: Verizon reported huge spikes in device and internet usage thanks tohome office workand social isolation. Between the weeks of 3/12 to 3/19, it saw web and internet traffic climb 20% (CNET)

It’s a good time to take risks, according toeMarketer: “‘Everyone is navigating new territory,’” Stacey Thomson, vice president of eBusiness and ecommerce at agile agency Scrum50 said. “‘Retailers can test and learn new ways to sell inventory and quickly meet new demands. It’s a forgiving time to take some risks.’”

Even Amazon is going back on its two-day delivery promise for nonessential items: “Sharp, unexpected growth in demand for Amazon is resulting in tough choices of how to manage the supply of in-bound products and available last-mile delivery capacity.”(eMarketer)

Lasting brand damage? People will be pretty understanding of the changing reality, says eMarketer in their podcast “Sizing Up COVID-19’s Impact on Retail.”

Online Grocery:NetElixirreported that online food sales surged 183% between March 1 and 25, vs. the same period last year.Millions of first-time online grocery buyers are materializing, and millions of infrequent buyers are now doing so on a weekly basis, vs. over multiple weeks or months (eMarketer).

Amazon:The top 10 US ecommerce companies—led by Amazon at 38.7%—will represent about 60% of ecommerce sales in 2020 (eMarketer), thanks in part to their online grocery delivery that is thriving during the coronavirus crisis.One example:“On Amazon, our clients in household goods and fitness are selling more than three times as much as usual” Buy Box Experts’ Thomson said. “Overall, sales are up at least 30% higher than what we would expect for this time of year.” (eMarketer)

The new “essential” items: What may have been considered nonessential are now the new necessities, includingsweatpants,self-care items, and electronics to make working from home more effective. As more gyms and fitness centers close to the public, shoppers have increased their spending for at-home fitness equipment. Online orders for products, such as kettlebells, dumbbells and treadmills have increased 55% March 11-15 compared with March 1-10, according toAdobe Analytics.

Get creative:A number of retailers have shifted to makeshift delivery options and click and collect options.Forbeswrote about a number of small businesses likeFaire, who traditionally sold candles, stationary, and beauty, but has shifted gears to more urgent inventory during the coronavirus crisis. The platform’s top-seller is now disinfectant and it’s added more household essentials like hand soap.Necessity is the mother of invention, reiterateseMarketerin their podcast.

Provide value:Think outside yourself. Let empathy and service leadyour messaging, your efforts, and next steps.According to Brit Bulla onMediapost, three distinct types of brand messaging have emerged during the coronavirus crisis:“All About Me,”“Helpful,” and “The Friend in Need.” Can you guess which is the most unappealing? Sharing all of your brand’s current news and how great you’re doing isn’t appealing to customers at the moment. Empathy and offering ways to help make their lives easier is.

To put this into perspective,83% of respondents want compassionate connection, including brand messaging that communicates empathy and support with the struggles they face, according to anEdelmanSurvey.29% of Americans have already begun using a brand due to the innovative or compassionate way they’ve responded to theCOVID-19 crisis. (Edelman) According to another study, 75% of respondents said that the way a brand responds to the crisis will affect future buying decisions (eMarketer).

Cater to frugal spending:We’re in the middle of an economic crisis. Chuck Grom at Gordon Haskett says it could take a couple of years for consumers to recover, he says, especially if the virus returns in the fall. He favors stores that cater to frugality. (Barrons)

Here’s what doesn’t work:Not addressing the crisis at all or continuing with thoughtless and potentially offensive messaging is damaging. 57% want brands to stop any advertising or marketing that is humorous or light-hearted.(Edelman).

While Katie's Twitter page and traffic may be down, do not go dark during the coronavirus crisis. Brands need to provide certainty and purpose. It’s important for retailers to be very responsive on social media and digital platforms, sayseMarketer.And taken a step further, 84% of customers want brand social channels to facilitate a sense of community and offer support to those in need (Edelman). In times where our security is threatened,people are hardwiredto seek clarity and calm, according toEconsultancy.

No crisis lasts forever. There is light at the end of this.The post-COVID-19 period will be used by many as a time of rebirth, and many will bemotivated by aspirational behaviours, writes Richard Storey forEconsultancy. “The best action for brands is to forecast the emotional state and behavioural changes required of everybody to re-start…In order for a brand to be there in the positive moment of a new beginning, it needs to stay active in darker times.”