In the almost 4 months since stay-at-home orders and brick-and-mortar closures first went into effect around the globe, e-commerce has taken off, a bright spot for the retail industry. But COVID-19 is changing more than where people buy. It’s changing what they buy – and having drastic impacts on supply. E-commerce after COVID-19 will reflect these changes, making agility and ecosystems a priority in order to quickly meet market needs.
The early days of self-isolation were full of stories reflecting the imbalance between supply and demand. Finding toilet paper, flour, and other essentials became near-impossible. Apparel retailers began to heavily discount unsold workwear, formalwear, and accessories to clear out unsold stock, even as loungewear sales went through the roof online.
Data from third-party online marketplaces illustrates just how quickly demand is changing – and how much retailers without flexible, agile assortment strategies are leaving on the table. Online marketplaces powered by Mirakl have seen year-over-year growth at more than double the rate of pre-coronavirus levels.
At the same time, fast-changing restrictions and requirements led to waves of changes in demand, creating a mandate for businesses to respond quickly or miss out.
E-commerce after COVID: Agility, flexibility, and adaptability are required
Consider the early days of quarantine preparation:
- Non-essential purchases dropped as panic-buying of food, health, and home goods rose
- Globally, online grocery marketplace sales jumped by a remarkable 27X year-over-year
- Home upgrades like office furniture and appliances grew by 4X, and consumer electronics like laptops, smartphones, and iPads were also in high demand, with 4X growth year-over-year
Even today, growth is well above pre-COVID-19 levels in many categories, and new patterns continue to emerge as we all adapt to the new normal. Take pets as an example: Mirakl-powered online marketplace operators are seeing 10X year-over-year growth in the category as people seek out leashes and other accessories for the pets they’re adopting during self-isolation. And, of course, throughout the crisis sales of medicine & medical supplies are way up, showing growth at 23X pre-COVID-19 levels.
There’s no denying that these numbers are remarkable. But when we look a little deeper, there’s a truly powerful message behind them: the COVID-19 crisis is an opportunity to rethink how our businesses operate. The traditional supply chain, with its “just in time” inventory, wasn’t built for this new way of doing business, and there’s no going back. To take the lead in this new world, every organization needs to invest in agility, flexibility, and adaptability.
The organizations that doubled their growth during the early days of the COVID-19 crisis already know it. They recognize that delivering what your buyers need right now – and setting yourself up for success in the future isn’t about scaling owned assortment.
By taking an ecosystem approach to commerce, they’re actually strengthening their relationship with their customers, working with sellers to source in-demand products, and adapting their assortment strategies in a matter of days. This also enables you to use your commerce engine to build, launch, and run you own online marketplace, transforming your business and introducing new business models.
This will allow you to initiate and increase your online product and services offerings with frictionless buying experiences and at the same time, limit your exposure to traditional commerce risks and expenses. And all this can be done because they’re doing it with the support of an agile platform business model.
No matter where you sit in the value chain, or who your customer is, the message is clear: we’re entering a new era of ecosystem thinking. This is an opportune time to determine what that means for your business – to be best-positioned during response, recovery, and beyond.