Amidst the COVID-19 pandemic, nearly every business in every industry has been affected one way or the other. The decades-long consumer trend that favors eCommerce has now become a need rather than a preference, and it may very well change consumer culture as we know it permanently. Several businesses both small and large have had to close their in-store locations entirely. Even those who have managed to keep certain sales channels open have had to suddenly and severely change the way in which they interact with and sell to customers.
In the meanwhile, eCommerce is experiencing a boom as more people are staying home and ordering goods online. Some e-tailers are getting more out of this unexpected rise in sales than others, mostly because of establishing a successful approach to eCommerce pricing.
Here’s how consumer behavior related to the virus outbreak has caused a growth in eCommerce sales, how many e-tailers are taking full advantage of the COVID-19-inspired migration to online purchases, and the long-term implications this change in consumer behavior has on eCommerce as we know it.
Consumer Behavior Has Been Forced to Change
Online shopping has been becoming increasingly popular for numerous reasons completely unrelated to COVID-19. Factors like younger, more digitally-native consumer bases, the rise in omnichannel retail, the hefty use of mobile devices when shopping, and more have made eCommerce an increasingly lucrative area of retail to be in within the past 20 years or so.
In other words, eCommerce being on the rise was already a trend, and a gradual but prevalent shift in consumer behavior that favored e-tailers and omnichannel retailers has been evident for some time now.
However, now that COVID-19 has spread to every corner of the globe and governments are putting large amounts of the population under quarantine and distancing conditions, online shopping is no longer simply demand or preference. In most cases, customers have little choice but to have items delivered to their door. Right now, you would be hard-pressed to find someone walking into a mall or to find a mall filled with open stores anyways.
Luckily for them, everything from pharmaceuticals to clothing has found a way to go online, and this pandemic has only given companies more reason to create new ways to get products into customers’ homes without them having to leave.
Pricing is Everything for eCommerce Right Now
This forced change in consumer behavior has been drastic, to say the least, but most e-tailers are not complaining. For a lot of them, their sales channels were already designed to continue making a profit despite these less than ideal circumstances, and they’ve been creating more ways for customers to buy online year after year. However, not all eCommerce retailers are equally prepared to profit from the current pandemic situation.
The e-tailers who have been benefiting most from this unforeseen change in circumstances are the ones who equipped themselves with the right pricing strategies and technology to benefit from this unforeseen, drastic change in consumer behavior. Most notably, those who have paid special attention to their price positioning compared to their competitors are the ones who have profited and will continue to profit the most.
Regardless of the outbreak, customers care a lot about prices, and the majority of them compare prices between several retailers online before making a purchase. Companies who are hyper-aware of this have implemented market-driven pricing strategies backed by advanced pricing software to ensure that their prices are always competitive at any given moment.
This is nothing new: Amazon, Walmart, and other retail giants have been using AI and massive amounts of data to change their prices constantly to keep ahead of the competition for several years now.
Needless to say, the e-tailers who managed to see the benefits of rule-based pricing and related pricing software are ahead of the curve amidst this surge of online shopping. However, it’s not too late for other retailers to get into the game and start increasing their sales and revenue by implementing the same tactics and technologies and moving their business from in-store to online.
Furthermore, the outbreak of COVID-19 isn’t the only motivation for e-tailers to start pricing smart: The predictions for the eCommerce industry as a whole prove that these investments are going to pay off even long after business returns to normal. As more and more products and services become available online, customers will expect them to remain online even after the outbreak is over.
This implies a long-term shift in customer culture that will favor e-tailers and omnichannel retailers with competitive prices over brick-and-mortar locations in the long-term and suggests that this will not stop once the virus has run its course.
To say that retail has been impacted by COVID-19 would be an understatement. The outbreak and measures people have had to take have impacted their day-to-day lives, and the way they shop is no exception. As in-store shopping has become near-impossible for many sectors of retail and unfavorable for most, more and more customers are shifting their focus entirely towards eCommerce.
Essential and half-essential goods are now in full demand for online purchase and doorstep delivery, and the e-tailers who were prepared for this boom ahead of time are making more revenue than ever despite these new challenges and unexpected changes.
Nearly every retailer stands to benefit from shifting their focus to online sales channels, and every e-tailer, no matter how prepared they were for this sudden shift in consumer behavior, can still equip themselves with the right tactics and technological innovations to ensure they can keep up with the competition, attract more customers, and make more revenue.
Predictions for eCommerce and consumer behavior show that these cultural shifts may have been encouraged by the COVID-19 outbreak, but they’re far from temporary. The best thing retailers can do right now is to invest in the right technologies that will help them win the eCommerce market both in the short-term and long-term.
I am a Pricing Solution Architect at Competera with more than 10 years of experience in Marketing Research and Analytics. I am proud to be a part of our team that is passionate about helping retailers to develop and succeed. We are always happy to share some expertise and insights.