As governments rush to deliver aid, and businesses of all sizes pivot to try and capture revenue, almost every industry is feeling the effects of COVID-19. Supply chain disruptions are leaving some scrambling to find and move inventory, marketplace infrastructure changes are affecting how and when buyers will receive their goods, and buyer behavior is flipping the status quo of what goods people want and need on its head. But the number one question on everyone’s mind is "how can I ensure my business is on the right side of history once this is all over?"
Together with ZonGuru, an all-in-one software solution for private label ecommerce sellers, we took a deep dive into the ongoing effects of COVID-19 to better understand its long term implications and what businesses can do to remain relevant.
If there’s one avenue of business that looks the brightest, it undoubtedly has to be online sales. It’s no secret that ecommerce sales have risen year over year for the past decade. Nowhere else in the world is this more true than in the United States, where according to the U.S. Department of Commerce, 2019 online spend increased by nearly 15% compared to 2018. Meanwhile, question marks loom for physical storefronts as many business owners wonder when restrictions will lift so they can reopen. The implications are widespread. Even large retailers are suffering: Adidas posted a 95% fall in net profits this quarter compared to last.
Online sales continue to soar, however. Major ecommerce platforms are streamlining efforts to keep up with demand, and improve customer experience. And they’re seeing results. Adobe’s Digital Economy Index shows that US ecommerce increased by 49% in April 2020, compared to March before social distancing and shelter-in-place restrictions went into effect. Clearly, shoppers are moving online.
An interesting insight from core customer data trends at ZonGuru shows that in almost all cases, sellers that actively optimized and expanded their business since last year (by adding one or more products to their storefront) have seen their business earnings grow during Q1 of 2020, compared to the same time periods last year. In fact, without removing the outliers, that growth is over 7.5x.
Let that sink in.
While the stock markets plummet and governments inject trillions of dollars into their economies, the average private label seller on the ZonGuru platform is actually growing compared to last year.
Sellers should understand that everyone is on a level playing field navigating the same ambiguity together. But the conclusion is clear: sellers that stay lean and adapt with the times will benefit. Ultimately, risk is reduced and revenue expands over the long term. Consumer demand will continue to grow, and in many cases, the only place to buy goods will remain online. Understanding the needs of your customers is the best way forward.
Hear more about the development of ecommerce and customer trends from Jon Tilley, CEO and Founder of ZonGuru:
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