Insights & Trends

The Role of E-Commerce in a Post-COVID-19 World.

3 min read

E-commerce post Covid.

Not that ‘long long ago, in a galaxy not too far away’ e-commerce leaders at businesses used to be touted as ‘evangelists. Someone to help convince others that digitisation should be a vital part of the sales mix and to be allocated more resources, and better talent. Thanks to Covid-19, that persuasion is no longer required.

There is no doubt that the trend of shifting from physical shelves to virtual stores has been there for some time; however, weaving in and out of lockdown restrictions has accelerated the adoption of E-commerce from a steady march, to a wild sprint to the finish line.

More than one in three UK retail sales took place online in February 2021 – a record high. (Office for National Statistics, ONS). With over 45% of UK adults receiving more parcels during the pandemic than ever before. While many retailers may believe that this shift is only a passing fad, international research by (Oliver Wyman) done several times since the onset of COVID-19, indicates otherwise.

Up to one-third of supermarket consumers who started buying online in response to the pandemic have continued to shop online after the restrictions have been lifted. The data also indicates a strong rise in online penetration beyond the grocery market, in industries like fashion retail and household goods.

SME E-Commerce Strategies

Undoubtedly, the shift towards e-commerce presents numerous challenges and great uncertainty to traditional brick and mortar stores. Despite this, defining a winning E-commerce strategy and developing the required supply chain capabilities can create massive opportunities to increase scale and profitability potential.

No two retailers are the same however, there are a few critical issues that must be solved in order for an e-commerce strategy to be successful. The first is to create a winning consumer proposition that is unique to your target market. Put simply it is a statement of the different ways you can provide value to your customers. It answers a crucial question that every e-commerce customer is asking: “Why should I buy from you instead of your competitors?” Once this is solved the next challenge is to develop and design a supply chain that delivers against this customer proposition.

One of the biggest barriers for both these key e-commerce levers for SME retailers comes from the 'last mile'.Many goods can be delivered the next day to Amazon Prime subscribers. Prime Now customers in select cities can get groceries and other goods delivered the same day within a two-hour delivery window.

This pressure to deliver goods rapidly is referred to as the “Amazon Effect"

On the flip-side, the large influx of customers toward e-commerce platforms has meant that traditional shipping companies have been unprepared for the increase of packages they had to deliver, and many customers were surprised to discover that shops' stated delivery dates for non-essential items were weeks or even months away. With shipping carriers maxed out, it has led to the development of a brand-new form of delivery service. Merchants have turned to same-day delivery apps to meet the shopper demand for speedy delivery, such as Carryr.

The majority of these platforms allow merchants to display their goods via a marketplace app. When a consumer makes a purchase using the app, a gig-worker is dispatched to the merchant's location to pick up the order — which is either ready to go or requires the gig-worker to shop the store themself — and then deliver the item to the end-customer.

These same-day delivery services can also be integrated into retailers' own websites. The consumer may, for example, pick "same-day delivery fulfilled by..." on the retailer's checkout page, and the gig-worker from whichever platform is then assigned to complete the delivery of that purchase. These new forms of delivery carriers have allowed even the smallest of retailers to benefit from the competitive advantages that arise from same-day delivery, scheduled orders and innovative security measures.  

Conclusion

The last 18 months have proved difficult for many retailers around the country, but it has also enabled others to explore new possibilities in the digital space and reap the rewards.

Although the market is tightening due to the number of active retailers online, the development of new carrier providers has somewhat evened the playing field for smaller businesses against the bigger players. Even in today's saturated media environment, with a smart e-commerce strategy, it is possible for SMEs to cut through the noise and turn threats into opportunities.

 

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About Charles Carr

Newcastle University Business management graduate, passionate about solving the biggest issues in the retail and delivery market.
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