Can Online Shopping Save Retail?

by WarriorForum.com Administrator
31 replies
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A new article by Entrepreneur asks if the devastating impact the Covid-19 Pandemic has inflicted on the retail economy has altered the way we shop, and changed the rise of e-commerce.

The current global pandemic has affected the retail economy so badly that "60 percent of listed businesses that shut their doors during the pandemic have permanently closed, including 48 percent of retail stores."



Covid-19 has resulted in many businesses turning to online stores to sell their products to combat social distancing. "Online grocery sales surged to $7.2 billion a month this summer, up from $1.6 billion last summer." Shopping methods such as kerbside delivery have also soared in popularity.

Why digital, physical, and Social need to exist in shopping


Why digital, physical, and social need to exist in shopping

Despite the in-person restrictions caused by our current global situation, shoppers still need to physically experience products such as shoes and clothes before purchasing. Customers don't want products to be blocked by a screen, and stores understand this. That is why slowly but surely, stores are letting shoppers back in, but with strict social distancing restrictions and cleanliness standards.

Shopping is a social pastime for many. Friends and family shop together and many people form bonds with staff members if they buy from a shop regularly. The fulfillment of social-shopping with friends and family simply cannot be replaced digitally.

How store 'Best Buy' is surviving the pandemic

U.S store Best Buy has taken minimal damage from the virus, "maintaining around 80 percent of its sales compared to the same time last year". It have done this by successfully integrating social, digital, and physical aspects of shopping, even during a global pandemic.

How exactly did Best Buy achieve this?

"Best Buy introduced its popular Geek Squad support staff and launched an app with social components such as the ability to access live support and make appointments. The company linked warehouse and store inventory so that local stores can fulfill online orders and hired in-store consultants to help customers discover products on site and then buy them online. They also began offering free in-home consultations to build trust in their brand and become the preferred supplier. These features helped create strong, faithful relationships with customers who don't want to navigate electronics purchases alone - even during a pandemic."
E-commerce has helped keep many businesses afloat during this pandemic, and without it, many more would close down.
#online #retail #save #shopping
  • Profile picture of the author SofienParisien
    COVID-19 has changed online shopping forever, survey shows

    The pandemic has accelerated the shift towards a more digital world and triggered changes in online shopping behaviours that are likely to have lasting effects

    The COVID-19 pandemic has forever changed online shopping behaviours, according to a survey of about 3,700 consumers in nine emerging and developed economies.

    The survey, entitled "COVID-19 and E-commerce", examined how the pandemic has changed the way consumers use e-commerce and digital solutions. It covered Brazil, China, Germany, Italy, the Republic of Korea, Russian Federation, South Africa, Switzerland and Turkey.


    Source: UNCTAD and NetComm Suisse eCommerce Association
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  • Profile picture of the author Naheed
    @admin,
    You are absolutely right. Pandemic affected all the offline businesses adversely. Pandemic urged most of the businesses to shift online as the figures reveal in this summer. Now, ecommerce will flourish even more in the upcoming years.
    As this shopping is getting trendy and users prefer to shop being at home.
    Regards
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  • Profile picture of the author Kay King
    Seems to me a lot of big articles are being written pointing out the obvious.


    Companies that had a strong online presence before the pandemic were able to pivot from 'mostly offline' to 'mostly online' sales with little loss of business.


    BestBuy has had a good online presence for years - not surprising that would save them now. Smaller companies may have more problems establishing themselves because they are competing now with hundreds of china-based sites (fashion sites, for example) selling cheap, poorly made goods and with very poor return policies.


    I've run across quite a few businesses where being online seems to have been an afterthought prior to the pandemic - because 'we have to have a site'. On those sites, the descriptions, the navigation, the guarantees of satisfaction are weak or non-existent. Quite a few businesses still had the old 'return cost' of years ago where if you return an item you pay a 20% or 25% 're-stocking fee' or required buyers to pay return shipping costs.



    Some stores have been quick to update their policies...one I noticed was Cavender's western wear - where there was a mandatory 'return fee' that has now been removed. Even the 'you must pay return shipping' is not enforced on that site now. I think offline stores that are quick to adapt their online presence to provide the same level of customer service have a good chance of survival in the business marketplace. Those who don't....don't.

    Amazon profits because if you can buy it from Amazon - why take the chance on a small site you've never heard of or a site where navigation is poor?
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    • Originally Posted by Kay King View Post


      I've run across quite a few businesses where being online seems to have been an afterthought prior to the pandemic - because 'we have to have a site'. On those sites, the descriptions, the navigation, the guarantees of satisfaction are weak or non-existent. Quite a few businesses still had the old 'return cost' of years ago where if you return an item you pay a 20% or 25% 're-stocking fee' or required buyers to pay return shipping costs.

      ...

      Amazon profits because if you can buy it from Amazon - why take the chance on a small site you've never heard of or a site where navigation is poor?
      I think because a lot of these business have a "build it and they will buy" mentality. They know enough about marketing to do the best practices within their own physical store. But for some reason, they can't seem to visualize how this all applies when it comes to building an online presence. And it's frustrating because a lot of good mom-and-pop shops have this mentality.
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  • I continue to agree with (the fund manager Gavin Baker's) the contention that it's actually the *category leading* brick and mortar retailers that will see the most long-term benefit from the pandemic. Some of these places were already "taking digital seriously" (Kay's point about Best Buy ... Target's another one), while others (Dick's Sporting Goods to name one) are now investing in ecommerce in a way that for the first time likely makes its importance on-par with merchandising in the eyes of company leadership. Found these points by Baker on this pretty interesting:
    • Beyond acquiring millions of new customers, seeing their e-commerce business reach levels in 2020 that most brick and mortar retailers likely did not expect until 2025-2030, experiencing profoundly positive cultural shifts and aggressively resourcing e-commerce for the first time, these brick and mortar retailers will face a significantly less intense competitive environment when consumers do begin shopping online again. Generally speaking, their weakest, most leveraged, most discounting prone competitors have gone bankrupt during Covid. So in addition to a structurally improved e-commerce business that should persist post Covid they will have a stronger offline competitive position post Covid.
    • Category leading physical retailer will have a 3p marketplace. These 3p marketplaces will benefit from integration with the stores in the sense that many new DTC brands will not sell on Amazon, but will happily sell through other 3p marketplaces especially if they are attached to a fleet of thousands of stores and the owner of the 3p marketplace and those stores commits to showcasing their brand in-store on a temporary basis a few times per year. Software is also making it easier and easier for sellers to sell into multiple marketplaces.
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  • Profile picture of the author cyholic
    In Main street in my town approx 5% of shops closed this year.
    I try to shop more local.
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    BR
    Freddy

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  • Profile picture of the author MicroHard
    The only thing that could save reatil is itself. The individual stores can only try to create webshops themselves or work together in regional webshops.
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  • Profile picture of the author Kay King
    The Gap has announced it is closing all of its shopping mall stores and over 100 Banana Republic stores as well....and will focus on outlet malls and ecommerce only.


    I wonder if that is the beginning of the end of 'shopping malls'? Or will this only affect businesses that were struggling offline to begin with?
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    • Oof. Add to this what's happening with movie theater companies - often mall staples and key trip drivers (AMC could reportedly potentially file for chapter 11 by end of year if it can't get additional financing) - and the current picture looks pretty bleak indeed. I wonder if part of what will eventually "replace" shuttered store fronts is "buy online, pickup in-store" hubs for the more resilient retailers and grocers.
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  • Profile picture of the author Naheed
    @Callie,
    I totally agree with your idea. Truly, it saves our tons of time.
    If people keep getting what is promised, it will flourish more in the upcoming years.
    Thanks
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  • Profile picture of the author Kay King
    But - that's been happening for several years. Covid may have speeded the process but personally I haven't been in a 'mall' for about 6 years or more.


    Fascinating to think back to the early/mid 2000's when we were asking 'will people ever be comfortable shopping for 'regular' goods online?' guess the answer to that one was 'yup'...
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  • Profile picture of the author Nizam Emon
    Yes,I think. Due to COVID-19 ,when all over the world kept in lockdown.All kind of shop was closed. Then anyone want to buy something ,obviously he would buy that product from online shop.

    And online shopping save retails.
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  • Yes, to a greater extent the pandemic has altered the courses of many businesses and staying digital has been the only way out. The world economy was prepared for this situation and this could have created move havoc if technology and most specifically mobile technology didn't exist.

    I would say yes online shopping has saved retail extensively, going to the verge of extinction and this is here to stay longer now, till the economy is on its foot again.
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  • Profile picture of the author Darren Clark
    The pandemic has absolutely changed the shopping styles of everyone. From essentials to luxury everyone has been dependent on online shopping. I completely agree that yes online shopping can save retail.
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  • Profile picture of the author danielkoelsch
    That hybrid online/offline shopping theme is powerful and the trend is likely to continue. Big chains like Best Buy with existing brick & mortar have an advantage, they can use their store presence as fulfillment infrastructure. Malls will have to pivot in the same direction, and they do already.

    For small e-commerce without physical presence this can work too, with partners providing fulfillment infrastructure as a service. Those services are likely to extend into existing unused retail space, e.g. malls. Closing the loop to the thought above.
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  • Profile picture of the author Kay King
    Interesting footnote to this subject.


    Pier1 declared bankruptcy just before this pandemic - then was stopped from closing/selling out until they could re-open. Pier1 is a store I used to visit regularly when I lived close to a physical store....their online presence was 'pretty' but not easy to navigate.


    That has changed...the plan now is to finish closing (permanently) the physical stores as soon as ll of them are allowed to re-oprn - and then Pier1 and it's various brands under that umbrella will be 'online only'.


    The site is easy to navigate now and will probalby get better. I think this move might save the Pier1 brand - it's a reputable brand but the small physical stores could not compete with online sellers.
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    • If memory serves, is Pier 1 one of the entities Tai Lopez (of ubiquitous youtube preroll fame) purchased out of bankruptcy as part of his 'transition brick and mortar to ecommerce' strategy? Interesting trend/strategy to monitor either way..
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  • Profile picture of the author Kay King
    The liquidation would have marked the end of another iconic brand but Tai Lopez and Alex Mehr's Retail Ecommerce Ventures (REV) stepped in to acquire the Pier 1 Imports brand for $31 million

    Yes - and I would think that's a huge wealth building endeavor- taking well known brands struggling and put them online in an efficient way. That's money in the bank IMO. Lot of money invested, too.


    Wonder if it's also being done on a large scale (or will be done) under the radar for restaurants/retail stores offline that are in great locations but failing due to covid restrictions...buy or option the property, acquire the brand name, etc.
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    • It does seem a smart strategy and worthwhile swing. Your restaurant idea in particular seems intriguing, too (I'm in for any lifeline to that sector). I wonder what 'converting them to mostly online' might mean? Cloud kitchens mostly focused on delivery and takeout?
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      • On the topic of cloud kitchens - I found this really interesting/cool. YouTube entrepreneur Mr Beast apparently opened a hamburger chain at 300 ghost kitchens (launched via a tweet) and availed it via food delivery apps. App jumped to #1 and reportedly forced server upgrades! Pretty creative business model indeed...

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  • Profile picture of the author EvolveBest
    Retailers who are offline better get an online presence. There are so many more options available online than offline for some of us. I like both personally, but retailers will have to shift and change towards innovative future based projects. From ecommerce to advertising business models to creating their own ebook.

    I have done and written the 2020 advanced ecommerce guide at the website ecommerce.fit and have also put together plr while working on potential digital or 3d products or a mix of both.

    It would be wise to have an online presence for all offline retailers if they want to play ball with their current inventory. Or what all good warriors do, start 2021consulting dot com or sell their inventory.

    Earlier this year I found out that a few of my business friends are selling their jewelry business, they don't have a online presence. I figured they would get one started but they dont want to , even though it could save their business. (i think it is because they already own 3 other jewelry stores)
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  • Profile picture of the author danielmcintosh
    Things are going to settle down pretty soon. It sounds weird if we hear a retailer not available online until now. They must be losing a big chunk of sales.
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  • Profile picture of the author MIqbal13
    Yes, with online shopping you can save your money. Because the well known and top brands offers high discount on their sites on events and sales. You can do online clothes shopping in Pakistan as well.
    There are so many website and eCommerce store that offers best prices and discount on popular brands. Like BrandzHub is one of them, Daraz, olx and many more.

    Thanks
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  • I don't think so, the online companies buy products in bulk so the price they get is cheaper than the retailer price. Online sites are harming local stores.
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  • Profile picture of the author allegandro
    Yes, online shopping made a huge step forward, but does this mean they can save retail?

    I think retail has to reïnvent itself. People don't get in their car to a shopping mall or the city centre to buy something they do not need now or have a big emotional value. They will order it online, but will they order it from the local retail company or from Amazon?

    If retail can add added value, they can survive (not win) the battle, but I see many retail companies that go online and don't add any extra value, so for consumers, there is no need to buy it from that shop.

    So yea, some retail companies will be saved, but many will fail and the gap will be replaced by the new giants and retailers that can add a new online shopping experience.
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  • Profile picture of the author Julia Timpson
    Hi Dear,
    The answer to your question is absolutely yes, because now we are living in a modern world where everyone wants their goods and services at their own doorstep, so yeah it definitely will save retail.
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    • yes, you are right!! In online shopping, we have more benefits like Time-saving, better price, more variety, and so on.
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  • Profile picture of the author Mary Annabelle
    I'm sorry but why couldn't they take their business online as well? What's stopping them. This is why you sit back and re-strategize and follow trends.
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  • I completely agree with everything that being said or have been said before. COVID-19 has changes our shopping experience for good.
    As business owner we need to change and adapt to the newly era where most people are online shopping.
    There're plenty of tools that were design in order to increase conversions. Apps like Twik that deliver every user the best version of the website in order to help them convert, something that we wouldn't be able to do in retail store.

    There are plenty of advantages in retail, but the power of the internet is much more effective because of the broad options we now have.
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  • Profile picture of the author Katie Leslove
    People are shifting from traditional shopping to online shopping very fast. As you mentioned about Best Buy, how it retained 80% of its sale in the pandemic also. All because of the online app which they used to take orders and give customer support. So, online shopping can definitely save the retails. Edited by moderator to remove link...
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