How Your E-Commerce Store Can Succeed During The Crisis
February 2020 marked the rapid global spread of coronavirus disease, and by the end of March, the majority of the world countries introduced strict quarantine measures to stop the epidemics. The situation is rapidly changing, and each state’s experience is different. However, the experts are unanimous ? COVID-19 will definitely have a big impact on business and the global economy. Revenue losses, layoffs, and supply chain issues are to be expected for small and big businesses globally.
Crisis Reality: Online vs Offline
With the quarantine and social distancing practices that are reshaping our everyday life, online retailers everywhere can expect to thrive. In a current situation, e-commerce has a number of solid advantages compared to offline stores.
They offer minimal human contact, 24/7 service, and global reach. Shipping costs and fluctuating delivery times can seem to be the drawbacks of online shopping, but now they are perceived just as minor inconveniences.
Despite the fact that e-businesses are most likely to succeed during the worldwide economic crisis, they also may face some challenges. During hard times, online retailers are sensitive to market alterations. Companies focus on offering the best online shopping experience possible. No one wants to lose clients and be a part of the race to the bottom line. Also, the number of pure players (online newcomers or offline retailers that switch to online) may increase soon.
All these factors will complicate the rivalry. So, the owners of e-commerce stores should look for ways to succeed and get ahead of their competitors.
Price Management Saves E-Commerce
One may confidently admit that the primary key to thriving online now is pricing. To defeat the contenders in the market, e-commerce players should consider competitive pricing and price analytics.
This managerial approach implies researching the market, analyzing the range of competitors, and developing the pricing policies. Pricing management helps online retailers to choose competitive prices that will attract more customers, enhance sales and consequently ? revenues. Price management may not only help to boost sales but identify true competitors, which is crucial both in short-term and long-term perspectives.
Naturally, many buyers are looking for discounts and bargains, and they make up their minds about the purchase based solely on the price of the product. A competitive pricing strategy does not always mean lowering one’s prices. Pricing analytics shows opportunities for the raises as well. Increasing prices while still offering the most affordable ones on the market is a great way to maximize profits. Effective price management assists in maintaining price differences that would elevate revenues and simultaneously draw new customers to an e-commerce store.
Implementing a competitive pricing strategy may be challenging. Firstly, it is a time-consuming process. Secondly, the prices of true competitors may change daily, so it may be difficult to keep all the data up to date. That is why it is much more convenient to automate this process with the help of artificial intelligence and machine learning.
Pricing analysis software is able to quickly and accurately process needed data about a business and market. This way price management allows e-commerce business owners to receive:
smart rules of action that consider market dynamics (i.e. price positioning, promos, etc.);
price suggestions without historical data (which is especially critical for pure players);
valuable products identification (focusing efforts on best-selling items to boost revenue).
Admittedly, the process of setting competitive pricing is live and market-oriented, so a retailer can get scheduled updates and react to changes almost instantly.
Extra Ways to Compete Online Effectively
To deal with the turbulent post-crisis industry, e-commerce retailers should build a suitable way of action. There are additional strategies that would help retailers to improve their performance online and leave behind their competitors.
For example, upgrading a company's marketing strategy can be a good idea. In order to reach as many existing and potential customers as possible, e-commerce platforms need to get their attention through constant and intensive social media presence and appeal to the target audience via their channels. For example, one can easily sell a meme T-Shirt to Tik-Tok users, while it would be much harder to do to a senior audience searching news on Facebook. Moreover, fresh and visually pleasing content grabs the attention of users; opinions of influencers and trendy topics attract potential customers. One shouldn't forget that email newsletters are still working.
Online sales correlate with shipping much. So, optimizing shipping (for instance, offering cheaper courier options or emphasizing drone delivery) is also a method to attract more customers and boost sales. It is relevant for specific services generally. Simply put, giving clients unique services (free birthday packing option, discounts programs, so forth) will be beneficial for building customer's loyalty. A retailer and a customer survived the crisis together, so why would the client turn back after?
It is still unclear if the COVID-19 epidemics and subsequent economic issues would have short-term influence only or the negative repercussions in the long run (the latter seems to be relevant). Despite the outcome, the future of the e-commerce field is bright.
To ensure success, online retailers should always remember about beating their true competitors. Developing marketing strategies, optimizing shipping, and nurturing loyal customers can be a solid advantage. However, price management is imperative for thriving in online retail. With the help of pricing software, e-commerce stores can implement a competitive pricing strategy and keep their businesses profitable during and after the crisis.
I am a Pricing Solution Architect at Competera.
Our team is passionate about helping retailers to grow and succeed. We know much about pricing strategies, pricing solutions, and price optimization in modern retail. Also, we are always prone to share some expertise and insights.View Yulia Beregovaya`s profile for more