Online retail: scalability and authenticity in a time of uncertainty

Globally retailers have spent the past few months rethinking their business models due to COVID-19. Perhaps the biggest challenge has been for brick and mortar retailers as they shift their businesses online, however, pure-play online businesses have not been immune to the change.

Across sectors, online audiences are soaring. Merchant data suggests that in the week commencing 10 May 2020, sales across sectors like apparel and electronics increased substantially compared to the same period in 2019. This means that there have never been more people shopping online and what’s clear is that simply having an online storefront is not enough. Retailers must ensure that the technology used is scalable enough to ride the waves of consumer demand and effectively meet customer expectations.

A shift in demand

N-Essentials is an Australian retailer and wholesaler of aromatherapy, natural skincare and personal care products. In the first six weeks of the COVID-19 pandemic, the business saw a dramatic increase in sales.

“While our sales were slowly building prior to the 15 March, we experienced an overnight increase that we could not have foreseen. As things like hand sanitiser started to run out, Australian consumers started looking for other options. As a result, the traffic to our online store surged,” Managing Director of N-Essentials, Kacie La, said.

While an increased audience is something that retailers aim for, the goal is usually a long-term one. For N-Essentials, the overnight increase, while welcome, was not equal to the size of their team and their ability to meet orders at that time.

“At the time, our small team of four were managing all functions – from marketing and purchasing to accounting. We had to start hiring, manufacturing, packing and fulfilling orders,” Kacie said.

CX drives future business

In the current climate, brand loyalty can be fickle – especially when products are scarce. Communication – whether direct, personalised or across social media – comes to the forefront at this time, and is key for retailers in terms of ensuring a level of authenticity and consistency.

“Our goal was to keep our customers across the challenges we were facing. Whether it was delays in postage, or delays in restocking causing backorder issues, we spent a lot of time speaking with customers directly, answering calls and emails to communicate any issues,” said Kacie.

Scale as needed

As brick and mortar retail starts to reopen, Australian retailers are again bracing themselves for change.

“As time goes on, and we acclimate to the increased online traffic, we’re running our business in a similar way to usual. We have since started to implement a sophisticated Inventory Management System to help us automate our stock management process to minimise restocking and backorder issues as well as improving efficiency and productivity. The volatility of what we experienced highlights the importance of scalability. As things start to settle, and we start to anticipate a drop in sales, it’s been crucial that the business is set up in a way that allows it to scale up when things are looking up and to scale down when sales are hard to come by,” Kacie said.

The nature of retail and shopping has transformed significantly from what it was a decade ago – and never more so than in the last few weeks alone. Customers have more choice than ever and brand loyalty is a concept that has faded into the background.

It’s clear that success in online retail will come to those who prioritise the delivery of an authentic and personalised customer experience, regardless of the global environment. Now is the time for retailers to showcase the true benefits and opportunities of online retail, in order to convert long-term shopping behaviours.

Shannon Ingrey, Vice President & General Manager – APAC, BigCommerce