These are truly unprecedented times — many businesses are in hibernation waiting for the situation to improve. The status quo is to cut back on all expenditure and to wait out the current crisis. However, this is possibly the best time to invest and reallocate your resources towards building your digital presence.
While most businesses have a digital presence, the sales achieved online in many cases are a small portion of the overall mix. But over recent years, the growth of online shopping has increased at 15.4% (IBISWorld) while traditional retail growth has been flat.
The growth of online shopping in Australia was forecast to reduce to a modest but healthy 5% (IBISWorld). But that was pre COVID-19. Necessity is now the driving factor of growth — not consumer preference.
With traditional retail stores closed during the health crisis, consumers who were slow to adopt the move to online now have few alternatives.
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Touch wood the current health crisis is on the improve and our lives will return to normal as isolation requirements are relaxed. The COVID-19 legacies that will not disappear may include a reluctance to shake hands, remote working and an increase in consumers who prefer to shop from the ease, comfort and safety of their homes.
The impact of COVID-19 on e-commerce providers is highlighted by the performance of ASX listed companies such as Kogan who confirmed the acquisition of an additional 140,000 active customers in April with gross sales growing by over 100%. (KGN ASX Announcement 12 May).
Another example is ASX listed company Temple and Webster who announced revenue was up 74% for the January 1 to April 24 period compared to the previous corresponding period.
Companies not fully prepared for the switch to online sales have had to switch to virtual waiting queues for online customers, as the infrastructure behind e-commerce platforms struggles to cope with the influx of online shoppers.
Often the problems small business owners face when building a digital presence can be traced back to a lack of planning. The importance of planning, implementing and executing that plan is no less important than moving in and fitting out a new bricks-and-mortar retail space.
Common mistakes include building your e-commerce site on the wrong platform or having a social media plan that does not align with your company brand.
Online provides the greatest levelling of the playing field for SMEs. With the right planning you can create a business model that is fully scalable. And by using analytical SaaS programs you can make informed business decisions based on the same information industry leaders are using.
The best business forecasts could not have predicted the unprecedented challenge presented by COVID-19. There have been few industries spared. However, those with a strong digital presence are certainly faring better than traditional bricks-and-mortar businesses.
TR Consulting is a boutique professional services agency. We offer consulting, advisory, accounting, digital marketing, social media management and website design and development solutions to SMEs. Want to know more? Book in for a no fee or obligation initial consultation.