The coronavirus crisis not only creates losers, but also some winners: online retailers and delivery services in particular, as well as online platforms for tutoring, fitness or cooking are all currently experiencing a massive sales boost. Social distancing is shifting both shopping and communication even more towards digital, which offers great opportunities for providers of such online services. However, even German SMEs that have found themselves in crisis, should perceive this as a digitalization push and initiate the necessary, in some cases long overdue transformation processes.
What does that mean in concrete terms? What steps should companies now take to digitalize their product portfolio and compensate for lost sales? Both B2C and B2B companies have a range of e-commerce measures available to them that make sense in the current situation.
In the B2C sector, action must now be taken quickly.
1. Discounts as an effective means.
Massive discount battles can currently be observed in the B2C sector. In the fashion industry especially, suppliers are currently trying to get rid of their seasonal goods. In addition, price reductions are also ensuring the liquidity that is urgently needed at the moment. The highest possible surcharge can be achieved with the right support through special newsletters and an increased and effective use of social media.
2. Through interactive features directly at the customer.
Keyword: Social Media. If a certain type of customer communication has been given a major boost as a sales channel during the crisis, then it is interactive features such as live chats and sales via live streaming that are most effective. These should definitely be integrated into the e-commerce strategy. The case of the Chinese cosmetics brand Forest Cabin, whose sales had slumped by 90 percent, shows what a great opportunity this offers. After a radical change of strategy with live streaming as the central sales channel, not only were all previous losses made up for, but just two weeks after the initiative was launched, the daily sales of the previous year were exceeded.
3. Digitalising loyalty systems.
Another tool that can be easily digitized are the well-known loyalty systems. For example, a well-known German perfumery chain has over 44 million loyalty cards on the market. These are well suited for contacting and retaining customers during the crisis. This applies in particular to older customers, whose willingness to use digital loyalty programs is significantly higher due to the crisis.
4 Exploiting the online marketplaces boom.
It’s well-publicized that Amazon, Alibaba and Co. are the big winners of the crisis in terms of increased market share. And others can also profit from this. These marketplaces should now be used as (additional) sales channels to take advantage of the current boom in digital marketplaces for their own business.
The Crisis as Digitalization Excellorator
Typically, transformations in B2B business are somewhat slower and are not implemented as quickly as in B2C. However, due to the massive impact that the Coronavirus crisis is also having on B2B companies, rapid action is now also required. The following four points are particularly important and effective.
1. Move Customer Services personnel to Home Office.
Customer services such as call centers and sales services must be made fit for the home office in order to continue to offer all necessary customer services and to be able to generate new business digitally. The fastest possible implementation is crucial here, since such services are needed at all times and this transformation is complex and extensive.
2.Digitalization of the Customer Journey,
The entire customer journey is currently shifting to online business, also in the B2B sector. As a result, all companies whose business model was primarily or even exclusively offline now have to invest more than ever in building their own service platform. This is the only way they can absorb the losses in offline business through online trading.
3.Agile working methods are more efficient than ever.
The crisis requires faster action, and budgets are now only planned in the short term and screened several times. To meet these requirements, agile working methods are a very good tool. A joint sprint every 14 days to redefine what is important facilitates an effective response to all eventualities and developments.
4.Sufficient server capacity is the A&O.
However, implementing all these measures is of little use if the website or even the web shop collapses during a run on your own sales platform. It is therefore extremely important to ensure sufficient server capacity and performance, either in-house or with an external service provider.
Companies that have already implemented some of these measures before the crisis are currently finding it easier to master them. However, the crisis mode in which our economy is currently operating should be seen as an opportunity to make up for lost time or to build on the digitalization steps taken so far. It is now more important than ever to implement the above-mentioned measures and to perceive this crisis as a catalyst and accelerator, because those who take the right steps now can emerge stronger from it.