- by Best Inc.
- November 10, 2020
The spread of the latest global pandemic has sent marketers into a frenzy to rapidly adapt and adopt new strategies. The impact of COVID-19 on e-commerce has shed some light on how important digital transformation is for many businesses. With quarantines and lockdowns happening across the globe, it is undeniable that the shift from our reliance in the physical world to the online world has penetrated some crucial aspects of our lives – from work, to education, to entertainment, to even shopping.
How COVID-19 Has Affected Retail Brands
While COVID-19 has affected all industries, retail brands are among the categories which have faced immense hardship in this period. With storefronts closing, retail brands have had to quickly refocus their sales strategy to convert their in-store sales to online sales. Bombarded by countless deals on the internet and coupled with free time at home in quarantine, consumers are making online purchases more often than before. It’s no wonder e-commerce giant Amazon saw its profits and share price soar amidst the COVID-19 pandemic. How do retail brands adapt their organizational infrastructure and cope with the stiff competition in the e-commerce space? While some brands are successful in their venture, other brands struggle to do so.
Examples of Successful Brands
Lululemon and Nike are two examples of successful brands in this new era of e-commerce during this period of pandemic. Having to stay at home under lockdown has led to the demand for athleisure wear to increase. It is unsurprising that lululemon and Nike are the top brands that come to mind when consumers are shopping for athleisure products. Having adopted an omnichannel retail strategy before COVID-19, both lululemon and Nike have a solid foundation in place to ensure their success: strong brand loyalty and an exceptional online shopping experience. This makes it easier for consumers to overlook their higher price point.
Having an integrated supply chain is another commonality that these two brands share. Being a vertical retailer, lululemon has a strong control over distributed inventory and product flow. Similarly, Nike has vertically integrated its operations and is involved in every segment of the value chain, from manufacturing to sales.
Examples of Struggling Brands
We find Under Armour and Uniqlo on the other end of the spectrum. Under Armour relies largely on third-party distributors, which began to struggle when physical stores shut down. Being reliant on third-party retailers also mean that Under Armour is at the mercy of their online experience, which is unfortunately too basic to meet the expectations of consumers today. On the other hand, Uniqlo, a brand known for its wonderful shopping experience in its brick-and-mortar stores, has seen a drastic decline in sales due to its mediocre online experience.
The Bottom Line
For many years, retailers have been moving their operations online by hopping onto the e-commerce trend to keep up with the digitalizing world. But the spread of COVID-19 has made it more crucial and urgent than ever that these retailers must make adapt quickly because there is no doubt that the changes in consumer consumption habits are here to stay.
Are you looking to build a seamless digital shopping experience for your e-commerce business and win your share in the retail space? Look no further for a trusted e-commerce fulfillment service provider. Contact Best Inc. today for quotes and discuss how we can best support your business.