How Small Businesses Are Fighting to Survive The Pandemic
The year 2020 has been like no other, in-store shopping has declined by 50% since the pandemic arrived. A number of big retailers have gone out of business, and a few small independents have also closed their doors forever.
But it's not all bad news. Smaller retailers that had resisted selling their products online, swiftly made the leap and dragged their shop into the 21st century. Those that made the move fast enough and selling the products in high demand have reaped the rewards.
Retailers are now preparing for the so-called 'Golden Quarter' (that time of year when most retailers expect to make most of their money) preparations are well underway to tackle demand during Black Friday, Cyber Monday and then the Christmas surge. This Golden Quarter is going to be far different from previous years.
Winners and Losers
Of course even in the online world there has been a massive shift in product demand. Suits and smart wear are out whilst lounge and sports wear is in. Consumer needs changed over night, but those shops with an online presence were able to adapted fast to meet these new demands.
A shift in product demand also meant retailers targeting businesses first and individuals second had to shift their marketing strategy. They were no longer talking to business managers, but individuals.
Being able to change marketing strategies not only applies in the midst of a pandemic, but also during any rapid or unexpected change in demand. Those that can change equally as fast and meet the new demand will survive.
Being online makes changing a shops focus far faster than is possible in-store.
There are a number of small businesses that have resisted going online to sell products. Often the though of having to deal with deliveries and returns and the extra costs that can be involved just didn't seem worth the hassle.
But because of the first lockdown, some small retailers were forced to close their doors forever. Only a small percentage of those decided to transfer their business online and get a website up and running and selling their products.
For some online shops their products have become hot commodities and demand has skyrocketed. Businesses that were lucky enough to be in this category changed their marketing strategy and quickly placed the products in demand at the forefront of their websites.
Language used by the marketing departments had to change, offices no longer needed desks and chairs, but individuals working from home did. Moving from words such as productivity and office furniture, to comfort, style and home working became more important.
The nation was told to get out and exercise for an hour a day, and about the importance of spending time in gardens for well being. This lead to an increase in demand for sporting goods and garden furniture, until stocks ran out and bicycles and garden furniture couldn't be found anywhere.
Although the publishing industry thought it was the end for them, they were one of the lucky industries that became popular. Bloomsbury Publishing saw a 10% increase across their business. Whilst their digital divisions saw a 47% increase in sales.
On the other hand some products are now suddenly less relevant and demand has drastically decreased.
Hair products, make-up and shoes were some of the items that people stopped buying during lock down. Once lock down was lifted, make-up didn't make a full recovery, because when wearing a face mask a full face of make-up is pointless.
The benefits of going online
Once a retailer has an online shop with customer tracking, they can start looking into real data to determine what their customers are doing and why. This helps when decisions have to be made fast.
In-store retailers noticed footfall was decreasing a week before the official lockdown date, but online sales were starting to increase before that, with demand for food and especially toilet rolls reaching crazy heights as people started to panic buy.
Garden centres were closed, so the companies who supplied them with plants could only sit back and watch a seasons worth of plants rot. The industry says there was a lack of demand, but I think the demand was there the plants just weren't online.
The companies who supply the garden centres said they couldn't make the switch between large deliveries to one location, over to small deliveries to multiple locations.
The smaller family run garden centres, who grow their own, have reaped the rewards. They were able to fill the gap the large multi-nationals couldn't.
How some small local family run garden centres met the challenge.
A local garden centre who has a website and Facebook presence but didn't sell online, simple changed their website to clearly show off each product and price (hanging baskets already made up with flowers). They also put a message out on their Facebook page with the same details.
They took orders over the phone and through comments in Facebook and delivered to their local community. Or arranged for customers to drive-thru and collect pre-ordered plants.
It was great watching them go pass on a tractor with a trailer full of plants and compost. They turned a negative into a positive and sold all of their stock.
This shows how smaller retailers can adapt far faster, then larger organisations.
How online retailers can deal with a boom in demand
High demand brings its own challenges. Here are some of the most important factors to consider when a product is newly booming.
Managing temporary out-of-stock items
This is so much easier to do when a retailer is online.
Online shops never have a missing space where the product should be. The product photos remain with an out of stock message, while they swap out the 'add to basket' button to 'leave your email address to be notified when back in stock' button.
This way the customer can still find out everything they want to know about the product, and get notified when it's available.
Addressing Customer Service Demand
Given the extreme circumstances we are facing, customers need more reassurance right now, they need to know what will happen when they order something, and how they deal with any problems such as returns or refunds.
Lots of people have been asked to work from home, or have been furloughed. This means most companies are facing reduced staffing and their call centres can no longer deal with the number of customer enquiries.
Most customers do not want to waste time calling customer services to get an answer to a basic question. If they can't quickly find the answers on one website they will go to someone else's.
When online, this is easily dealt with. Having a prominent message about procedures during COVID-19 with a link to a Frequently Asked Question (FAQ) page should be enough.
Ways to find out what customers want to know:
- customer service reps will know what questions they are having to answer repeatedly, these can be added to the FAQ page
- Social media comments will also highlight what customers are becoming frustrated about
- Then there are the obvious problems, such as shipping delays because of reduced staffing across the supply chain.
Letting people know what is happening up front, sets their expectations before they buy, reducing the amount of angry customers that will need to be dealt with later.
There can either be a page dedicated to FAQs, banners across the top of the website, pop-up messages, or a tab 'COVID Questions' on each product to address changes in operations due to the pandemic.
Meet consumers where they spend their time
Consumers can be found in online social networking groups, often within Facebook or websites like Mumsnet. Retailers who look at the language they use and adapt this to sell their product will be ahead of their competition.
As an example, before the pandemic office furniture companies focussed on business language as they were talking to the office planners. Their product photos would show a shared office space with their furniture featured in it.
Since the pandemic, these companies have updated their home pages to show off home office spaces. Standing desks, home office and home learning solutions have taken priority. This doesn't replace office-focused messaging, but supplemented it in a useful way. The language used changed from business talk 'increased productivity' to lifestyle choices 'comfort', 'ease of use', 'beautiful design', 'learn in comfort', etc.
Moving online provides retailers with new opportunities to create new pages to sell products in different ways
Not so long ago people were looking for hand sanitisers, cleaning wipes, masks and gloves. All of these items will have a product page all to themselves to capture a persons attention in the search engine results.
However, now people are using the terminology 'social distance supplies'. This gives the retailer the opportunity to create another selling page on their website, where all products under this category can be listed with a link to the products individual page.
Websites with internal search features, allow monitoring of product demand and the language customers use to find what they want. When a trend is spotted, a new page can be implemented that targets the new trend.
When demand for a product dries up over nightThis was a reality for many retailers from March 2020. Luxury goods, apparel, holidays, as well as try in-store models struggled.
A market can't be changed, but there are practical ways retailers can help themselves to make the most of a bad situation.
Highlight the most relevant products
When hotels, pubs and restaurants had to close, as well of having to deal with social distancing when they could reopen, many felt this was the end for them. But a few pubs with restaurants transformed their businesses into take away services.
A local pub with restaurant who couldn't open up during lockdown, transformed themselves into a meal making machine for the NHS. This gave them the training they needed to be able to offer take-out services once they were allowed to reopen.
This has proved to be a life line to them because social distancing limited how many people they can serve throughout the day. But it hasn't limited how many meals and drinks they can sell.
They place photos of their meals and drinks on their Facebook page to encourage the local community to order take out. They have also adapted their website to have a take out menu, ordering and payment system.
Although some clothing retailers are struggling, some moved towards creating a loungewear category and prominently featured these items on their websites and within email marketing. Loungewear may not be their primary focus and it's not the most expensive clothing line, but it is more likely to be purchased at this time.
Google Trends clearly shows how loungewear internet searches increased during the early days of the pandemic and how it is spiking again now we are entering the second wave of the virus:
Compared to party dresses:
By now searches for party dresses should be taking off, but it remains stagnant as office parties are not likely to happen this year.
Retailers should scan their product catalogue to see if there are any items that could be popular during a pandemic and bring it into a prominent position on their websites, social media accounts and within advertising material.
Crafting messaging for the moment
When current messaging (adverts, call to action, branding) no longer makes sense given the change in consumer lifestyles , it has to change.
There is no point pretending we are not in a pandemic. Messages with 'looking for winter holidays', 'nights out' and 'Christmas parties' are just going to remind people of the things they can't have right now.
Many clothes shops have moved to free delivery to encourage customers to buy. Their message hasn't changed that much, but 'free delivery' is clearly displayed and can't be missed.
Replace in-person experiences with virtual experiences
Although there has been a number of causalities in the Escape Game industries with a few closures, most of these businesses changed over night to virtual experiences, as well as selling books and games. Their customers had already come from the virtual world, so it wasn't much of a leap to take them back to virtual. The escape rooms message only had to change slightly from 'Escape Room' to 'Virtual Escape Room'.
They have managed to keep their customers entertained, and engaged while they wait for them to return once the pandemic is over.
Engagement rings have seen a big downturn, but some online shops have tackled this by doing virtual viewings.
A customer can take a photo of their hand and upload it to an app, where they can see how their favourite rings will look on their finger. The jewellery retailers message only had to change slightly from 'Try On In Store' to 'Virtual Try On', with an additional description so the consumer knows what to do 'Try It Yourself - Browse engagement rings on your phone and select your favourite ring'.
Change in consumer demand is a challenge retailers face everyday, right now the pandemic has expedited change in the way consumers shop and live.
COVID-19 has forced more businesses to operate online, and since then we have seen a huge spike in online buyer interest that has steadily increased since the pandemic started. This digital transformation was already occurring before the pandemic, but COVID-19 accelerated its implementation.
We help small to medium sized retailers to get online fast and start selling within weeks. Contact us for a free no obligation quote.
Christinas is an example of a small retailer who we helped get online during the pandemic.