Digital Leapfrogging: Will Your Ecommerce Business Get Jumped?

kids playing leapfrog

The retail landscape demands bold decision-making to keep pace with the rapid digital transformation that is taking place before our very eyes.

Late adopters to ecommerce are coming to market and a larger number of customers are engaging with different products and services for the first time. With a third of global consumers shopping more online now, and a quarter saying they plan to, the habit will prove hard to break. The potential for wallet capture also creates an opportunity for brands with disruptive models, and large marketplaces could all thrive.

New direct-to-consumer brands are looking to position themselves to take advantage of the ecommerce bonanza. Stores created through Shopify Plus increased by 62% between March and April 2020, highlighting the speed and ease with which new brands are able to get online to meet new demand.

The pandemic and its impact on retail has seen smaller players ramping up radical innovation and digital transformation. Others, especially major store chains, lack the technology infrastructure to pivot smoothly, if at all, and have faltered as a result. They are struggling to respond to a once-in-a-generation test of business continuity planning and supply chain flexibility. Have no doubt, COVID-19 is the retail equivalent of a meteor impact, an existential even that changed the nature of the industry and, sadly, is eradicating jobs and businesses.

Many retailers who made it through the last few months have been so busy reacting to the challenges that they haven’t had time to consider, plan or prepare for what the future looks like post-pandemic.

That’s a dangerous position to be in, especially with the looming threat of a second viral wave. To survive and thrive, they need to reassess their digital infrastructure and plan for operating model changes right now.

Companies that are resistant or slow to change face real threats from the emergence of a new group of DTC brands, boosted by technology, that can deliver a complete end-to-end customer experience.

The laggards need to address their operations urgently, or risk being digitally leapfrogged and left behind by the pack of hungry DTC brands racing to become ecommerce leaders in the brave new world.

Post-COVID Prep: Think Pre- and Post-Purchase

As we are seeing through the rapid upswing in stores created through Shopify Plus, most brands understand the urgency to create sleek ecommerce sites to attract direct sales. However, few seek to address the operational complexities post click – a costly mistake. Without solid operational mechanics in place for inventory, shipping and multichannel logistics across locations, or more real-time customer support, businesses will quickly run into problems.

Discussing the importance of operations in ecommerce success, Eve Mattress Co-Founder Kuba Wieczorek puts it best: “That whole back end is so mega important that if you don’t get it right you’re screwed.”

Post-COVID-19, online businesses are operating in an arena of greater competition and heightened demand. Some categories we work with are seeing 600%-800% YOY increases in direct online sales, with similar highs in demand post-lockdown. Even when the virus recedes, new online behaviors will likely extend the spike to all types of retail. Thus, companies need to be asking themselves if their current setup supports the increases in traffic of the new normal.

Unfortunately, most retailers lack the agile digital retail infrastructure to successfully manage inventory, same-next day delivery, shipping and returns at a level that meets consumer expectations set by ecommerce leaders like Amazon.  

Show More Digital Ambition

In my view, retailers will need to show more digital ambition in order to be able to deliver excellent buying experiences and stand out from the pack in the post-pandemic landscape. More consideration should be given to investment into highly efficient and flexible ecosystems that can support speed and convenience, handle bursts of growth and the diverse needs of blended cross-channel experiences. For instance, buy online, pick up in store services have increased 65% since the crisis began in March, according to a recent study.

It’s important to remember that post-purchase experiences, from delivery to returns, have a direct impact on loyalty. To double down on this, our Rise of the Review Culture study found a whopping 61% of consumers have experienced issues buying from brands online within the past 12 months alone. Most problems related to post-purchase experiences such as delivery and returns, inventory management and customer communications. In fact, the same study revealed that 77% of all poor experiences are directly related to issues after the buy button, and two thirds of shoppers said a poor experience makes it unlikely they’ll shop with the brand again.

When looking at this data it’s clear why each scenario after the buy button should be recognized as equally important as those on the front end. This also presents an opportunity for ecommerce brands to emerge as leaders – and do some leapfrogging themselves. This requires being willing and able to implement a true consumer-focused strategy, becoming responsible for every scenario in the buying journey, including pre- and post-purchase experiences.

This begins with an honest audit of the complete customer experience, identifying improvements and bottlenecks along the journey. It also involves seeking partners who can help ensure the entire operation meets the challenges of post-pandemic retail, making them agile enough to compete, differentiate and thrive.

Derek O’Carroll is CEO of Brightpearl

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