More and more supermarket shelves are bare of items like toilet tissue, hand sanitizer, rubber gloves, and bottled water. Reports are coming in that others who have these items in stock are price-gouging and selling them for several times their normal value. What are marketers to do amidst this paranoia?
In a survey by Digital Commerce 350 this March, more than a third of retail merchants are still sitting on the sidelines to wait things out. Only 18.2% said they were taking assertive steps to keep their supply chain open. 34% of the 304 retailers said they’re expecting certain items to run out. They also felt that there would be disorder in the supply chain and a deficiency of popular goods among some of their suppliers.
On other hand, 30% told Digital Commerce 360 that they expected to see a slight increase in online sales because of COVID-19. 7,3% were more optimistic and felt there would be a substantial rise in ecommerce.
What made the survey even more interesting is that an almost equal percent of those surveyed had opposite opinions. 30.7% believed revenues would be down slightly, while 5.2% thought they would drop significantly. The remaining 27% didn’t think there would be any change.
Here are some things retailers taking steps to maintain a supply of inventory told Digital Commerce 360 they’re doing. The most obvious was keeping in touch with their suppliers. 49.9% said they were maintaining constant contact during the pandemic.
Next up was forging plans that would minimize negative effects to their sources of inventory. That was noted by 31.8% of respondents closely followed by 30.2% who said they were also working with their suppliers and shippers to keep interruptions down to a minimum.
23.4% cited making modifications to their product venues as well as a constant and determined effort to scrutinize deliveries from China as another agenda item. 21.4% admitted that they were rethinking their sources of products to decrease future risks and another 20.3% said they already lowered their reliance on manufacturing by the Chinese. 17.7% confessed to finding substitute non-Chinese manufacturers.
Marketers might also derive benefit from the final question in the Digital Commerce 360 survey. This had to do with expectations and behaviors because of COVID-19.
One of the biggest concerns was about the intensity of customer loyalty. 40.1% reported this after acknowledging anticipated product shortages for the remainder of the year (44.3%) and delays in manufacturing/production (43.8%).
Another 18.8% revealed that they’d be reviewing and adjusting their 2020 sales forecast, and 11.5% added that they’d also be amending their financial guidance. 15.5% acknowledged that they’d be talking to colleagues in the same industry.
The survey and the findings come at a time when there’s also increasing concern among some economists about a possible recession, particularly with the recent and dramatic ups and downs on the stock market. The last recession ended in 2009, with one occurring historically every six and a half years. The challenge for marketers will not only be in managing the effects of COVID-19 on their brand but also preparing for the possibility of a recession.