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How can E-commerce Businesses handle Rising Customer Demand amid COVID-19?
Novel Coronavirus (COVID-19) has affected various sectors and industries severely. According to experts, its initial impact on e-commerce has created challenges for businesses in the industry to deliver online services that no one could have predicted before.
If you’re in e-commerce, there’s a good chance for customer demand to increase during this time of COVID-19 significantly. People are mostly stuck at home, and they would likely be making purchases online.
Besides, we all know how popular online shopping has gotten; with mobile services like shopping apps and mobile banking (also the integration of both), almost 72% of customers are using mobile phones for shopping and payments. Order management, fulfillment systems, and supply chains are all being tested by huge online orders and revenue growth nowadays.
While many companies are outsourcing back-office functions such as e-commerce data management and accounting, some are finding multiple ways to get through these tough times. In this blog post, you get to read expert tips to cope with the rising customer demand during the pandemic.
1. WMS: One Solution for Many Challenges
E-commerce isn’t a flat line level of customers all year round, in our experience, there are spikes around significant occasions such as Black Friday, Christmas, and Halloween. Luckily over the years, we’ve managed to build systems around the potential problems, but a lot of newer retailers to e-commerce aren’t aware of them.
The first challenge is hosting, trying to find a platform that can cope with huge spikes of traffic; retailers need systems that can scale horizontally to manage increased traffic levels. Just swapping to a beefier server isn’t enough, as small pieces of inefficient code can suddenly slow down your website, or even take it offline, which is a disaster when you’ve 10,000 users online trying to buy.
Another challenge we often see from retailers is the ability to manage stock and their warehouse. A robust (WMS) Warehouse Management System that fully integrates with their cart is essential. With pressure on warehouse staff to pick and pack more orders, its only human for mistakes to happen. A warehouse management system can help ensure that the right product, in the right size and the correct color, is sent to the customer.
2. The Adoption of Automation
E-commerce stores are now trying to automate their processes as much as possible so that they can focus on their core management. E-commerce businesses can cope with rising customer demand due to the pandemic by:
- Strengthening its vendor base,
- Focusing on system delivery pattern,
- Focussing on customer feedback to help themselves create a more user-friendly store,
- Partnering with niche-specific other e-commerce stores to get products in case of no stock,
- Focusing on branding, so after the pandemic, you can get repeat customers.
3. Planning & Execution – Revised
Increasing customer demand is a good thing for an e-commerce business, but many merchants are not prepared for the obstacles that come with increased traffic and transactions. For example, fraud has become an increasing problem for e-commerce merchants during the COVID-19 pandemic.“There will always be malicious users trying to take advantage of e-commerce businesses, but merchants can take steps to minimize risk by preventing a bad actor from placing an order in the first place or identifying fraudulent orders before they’re actually shipped out of their warehouse.
While a manual solution where your warehouse staff or your customer service staff are taking a look at orders is a good start, but when businesses experience growth, adopting a third-party solution can offset a lot of the liability in figuring out whether an order is legitimate or not. There are many factors that go into putting together the right fraud prevention plan, including cost, the merchandise, and order numbers, so e-commerce merchants should invest time into putting together the right plan and solution they can protect their business during this time and beyond.
4. Drop Shipping & Other Solutions
E-commerce businesses should automate every step in the order process. Website copy should encourage customers to place orders online rather than email or phone. Any order approvals should be eliminated or minimized. Order placement and order fulfillment systems should talk to one another, so nothing is manually entered. Tracking notifications should be automated and generated from the warehouse if possible. This may require new equipment in warehouses, etc., but it will significantly reduce errors and shorten lead times.
Businesses can also look into drop shipping from their suppliers. Dropshipping can reduce fulfillment times if inventory is running low. It can also relieve strain if warehouse staffing is short.
If drop shipping isn’t an option or won’t handle the demand, businesses can look for ways to shorten production lead times. Businesses could expand raw or finished material suppliers, invest in additional tooling or equipment at the manufacturing plant, utilize different transportation methods, or hold safety stock somewhere in the supply chain.
5. Extention for Deliveries
Jeff Moriarty, Marketing Manager at Moriarty’s Gem Art
Our online business exploded during the pandemic due to Mother’s Day, and people wanted to purchase online and ship to their mother’s/wives. We saw an increase of 300% in online sales over the previous year. With the reduction of staff on a constant basis, we had to delay order shipping from 2 days to 5 days just to keep up.
We usually have a cut off day for delivery 3 days before Mother’s Day, but we actually had to move it to 7 days. This did cause us to lose a lot of sales, but we didn’t have the staff to fulfill all of the orders, so it was the only thing we could do. It worked out in the end, and we made it through the holiday and pandemic.
6. Additional-Support Helps
Most e-commerce businesses had to hire additional help to keep their store running 24/7 due to the increased demand in online shopping brought about by the Coronavirus outbreak. Some also had to hire additional delivery men in order to be able to ship out all items ordered on time.
7. 3 Ways E-commerce Businesses can Increase Supply Chain Resilience
My advice to any e-commerce business that is fortunate enough to be seeing an increase in customer activity–either more people purchasing products from them, higher average order sizes, or some combination–is to check your supply chains for weaknesses and strengthen where you can, cut where you can’t. This could mean a number of things:
- Investing in better inventory management software to maximize the efficient allocation of resources and minimize the likelihood of stockouts
- Increase the size of your workforce by bringing in more warehouse workers and other laborers so that you are able to carry out order fulfillment speedily
- Let your customers know before they buy that there may be delays. Do NOT list products in stock when you don’t have them in stock. Nothing will upset someone more than being lied to about the availability of a product and then being forced to wait for weeks for it to arrive. Clear communication and setting realistic expectations is a must for any e-commerce business right now.
8. The Stock Reminder
One way e-commerce businesses can cope with rising customer demand during Covid-19 is to start a customer waitlist for products that are sold out that they can’t get an immediate backup product in for. This allows customers to place their name on an order reminder list even while the product is not currently available while allowing the business time to order a new product and then send a launch email to customers when it comes in.
9. Leverage AI Tools and Train Support Staff
Consumers are tired of the uncertainty that COVID 19 has unleashed. As a result, more than ever, they want consistent, convenient, frictionless customer experiences — especially when it comes to customer service. And there’s a great that commerce brands can’t control right now — they’ve had to navigate pandemic-related supply chain and staffing challenges all while keeping up with heightened customer demands. So it’s vital that what brands do have control over, they act upon quickly. Revisiting long-standing policies and processes is a must to matching customer shelter-at-home expectations.
To cope with the spike in e-commerce customer service queries, online retailers must provide extra training for their support staff and leverage the AI customer service tools to enable their staff to cope. In the end, the customer doesn’t care if its artificial intelligence or human — they just want intelligence that will help fix their problem.
10. Develop and Maintain Business Relations
With many consumers stuck at home during the pandemic, some of our products have seen a significant uptick in demand over the past few months. This has been tricky for us to deal with, as our production orders are planned out well in advance. The number one thing that has helped us here is developing strong relationships with our manufacturers and treating them like family. Over the past few years, the kindness and flexibility we’ve shown with them have really paid off when we are their number one priority during difficult times like we’re in right now.
11. Use Research Data and Customer Feedback for Strategic Planning
With all of the changes to customer purchasing habits pre-COVID-19, we expect to see pent up demand for e-commerce businesses. Making decisions based on data and feedback are likely to be more successful than those based on assumptions. Market research is a great way to test products, services, concepts, and strategies for e-commerce businesses. Luckily, gathering data online is becoming easier, and there are several solutions to explore.
One way e-commerce businesses can collect data is through website intercept surveys. Common ways to conduct a website intercept survey include a modal pop-up in-screen survey or a modal pop-up survey invite. Benefits to website intercept surveys include gathering real-time responses as users are actively on the site, reaching all types of visitors, and creating a strong call-to-action.
12. Fulfill Expectations
As an e-commerce store owner, this is actually a good problem to have. But if you get lost in the shuffle and become unable to handle it well, the results could also be unfavorable, and at worst, catastrophic. So what do you do when there is an increase in customer demand during the COVID-19 outbreak? Here are a couple of things:
Manage your clients’ expectations: Failing to deliver on a promise to a client will badly hurt your credibility. The trust level will wane, and the relationship will eventually sour. It all comes down to honesty with what you can deliver. Be as transparent as possible, and your clients will appreciate you for it.
Plan thoroughly: Once you see the spike in demand, you must immediately create your plan of action. If it’s possible, create a detailed plan on how you intend to go about dealing with the demands for your products or services. It’s akin to arming yourself with more than enough weapons and ammo before going to war.
13. Omnichannel is Powerful
Firstly with the social distancing rules in place, it is ethically and legally impossible to revert to the brick-and-mortar sales system. One has to realize the fact that the omnichannel is now evermore powerful. One primary focus of neutralizing this tendency is to do more specialized product portfolio matching with customer segmentation. Understand the frequency and order pattern of different categories of the product line for different demographics of online customers. Then classify and aggregate demand response in accordance with the trend.
It may even be required to tweak the business rules that govern the specific e-commerce channel/s. On one level, this implies requiring more powerful analytics support and flexibility from the part of organizational leadership to reset or renew their inventory and demand management policies.
On another level, the retail company’s marketing and sales functions have to collaborate more rigorously to enforce the optimality of the demand shaping process. A lack of transparency between these two could be detrimental to keeping head up from submerging in the demand explosion.
On the whole, the retailers have to make the customer online experience more smooth, considering his status quo, so that customer retention and growth is still viable and profitable.
14. Keep Your Customers Informed
As orders fly off the shelf, items go out of stock, and shipments are delayed, a big issue facing merchants is customer dissatisfaction.
I advise all e-commerce businesses to focus on consistently communicating with customers every step of the shopping experience, from browsing to checkout. Provide updates to company policies, expected wait times for processing and shipping, frequently asked questions, and especially your return policy.
It’s also important for your business’s contact information to always be visible and easily accessible. Whether it’s an email, chatbox, or phone number, make sure they are monitored and that someone is available to address customer questions and concerns.
15. 3 Way to Cope with Customer Demand
As you can imagine, delivering a commodity like face masks at the moment is an incredible challenge, especially with the limited supply chain, but there are some steps I have taken to cope with the demand.
Transparency – Whether it is a shipping delay or production delay, inform your customers that their order is delayed with a fair explanation. At the same time, make sure to give them an update on when they will be receiving their order and apologize for the inconvenience!
Customer Service – From a customer’s point of view, there is nothing more frustrating than purchasing a product or service from a company online and not hearing back for a few days at a time. In the world of e-commerce, customer service is the key to success. Make sure your customer service team is large enough to respond to customer’s inquiries within 24 hours. A short response can really give your customer peace of mind and will lead to referrals and reorders.
Diversified Supply Chain (if applicable) – It is important that you are not relying on one source for all your products. If restrictions are put in place or for one reason or another, the product doesn’t come in, your company’s success can be in jeopardy. If your product can be sourced from multiple suppliers, do that! I’d rather pay a slightly higher cost for the product using multiple suppliers than solely depend on one.
16. Fix Supply Chain and Delivery Mechanism
COVID has put e-commerce in trouble because demand is high, the stock is less, and home deliveries are also getting a bit late because of the vast number of orders. E-commerce stores should expand their supplier database and prefer the ones with shorter delivery time even if they cost them a bit more. Because losing a client is a more significant loss than buying something at a slightly higher price.
Next, if their delivery system fails, they could sign a contract with delivery companies with excellent service reviews. It will put off their load, and the client satisfaction rate would also be maintained.
Customers are panicked, and they are in the race of piling up the stock. Companies can bring them out of stock phobia by sending them new stock notices weekly or whenever their stock arrives. It will soothe the customers’ nerves, and they will order products only according to their needs.
17. Process Auditing can Help Improve Operations
The most important thing that e-commerce businesses can do to effectively handle an increase in demand is to ensure that their systems and processes are built to scale. Whether it’s marketing, fulfillment, or customer support, it’s important that businesses identify weaker systems and processes that might break if put under the stress of additional demand. Examples include un-automated marketing emails, inventory management that does not sync directly with websites, or the lack of a ticketing software system to handle customer support issues.
Companies can identify these issues by working with their internal teams to surface potential issues ahead of the surge in demand. Once identified, companies will need to move quickly to get new software systems in place, fix processes, or hire temporary employees to stopgap their issues. If left unchecked, companies will experience material issues at a time when they’re under the most pressure from demand.
Recommended Post: How can eCommerce Businesses Thrive during the COVID-19 Outbreak?
The rising customer demand amid the COVID-19 outbreak has hugely impacted online stores. E-commerce businesses must upgrade their methods of operation to respond to high levels of demand. As suggested by industry experts, these tips can help effectively. Among other solutions, outsourcing has become a prominent trend in all industries and is considered a viable solution by many.
Some of the back-office processes you can outsource; inventory support and management, e-commerce business accounting, e-commerce data management, and e-commerce catalog management services. If you’re looking for outsourcing solutions, get in touch with Cogneesol today. We offer industry-best back-office solutions to all types of businesses in the e-commerce industry.
Contact us now to get a free trial. Call us at +1 646 688 2821 or email at [email protected]
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