Over the past few months, employees all over the world have stopped going into their offices and are now working from home. Companies are rethinking their delivery of goods and services to their customers, reorienting their staff management, and pivoting in response to each new development during this global pandemic. No matter the size of your business, you are likely to have been impacted in some way by COVID-19.
We at 2Checkout recently conducted an international survey of over 800 merchants selling digital and physical goods online, about how the COVID-19 pandemic has impacted them. The responses, not surprisingly, were mixed.
Good and bad news for eCommerce
It wasn’t all doom and gloom, and some 12% of those surveyed actually reported expecting a positive impact from the recent global situation. Multimedia software producers, middleware companies, and even some entertainment providers said they will likely record business growth as the year advances, while 8% say they have noticed no impact.
From the other, more somber perspective, about a third of merchants (32%) told us that the recent social-distancing pandemic will have a significant impact on their business, a threat they hope to mitigate with a well-executed crisis plan.
The production side of industry—physical goods subscriptions, manufacturing resource management, consumer electronics, and hardware— appear to be the most apprehensive about the crisis’ potential aftermath on their companies. Those businesses whose activity depends on user consumption habits—marketing and advertising, human resources management, social networking, and entertainment suppliers—also expected the pandemic to have a significant impact on their business.
In the end, 28% of businesses reported that they expect to be critically impacted, with the COVID-19 pandemic posing a real threat; survey results revealed that those in physical goods retail are some of the most apprehensive about the crisis’ potential aftermath on their companies.
Challenges to sales levels, customer delivery, and acquisition
Naturally, when all of our day-to-day lives have been so dramatically impacted and businesses are shuttered all over the world, the threat of falling sales feels very real. Forecasts of slower sales span a variety of industries and markets, and it’s clear that we will not know the full effect for a year or more. Fulfillment and supply chain has also affected has been; 21% of merchants told us delays in these areas were a current challenge, with physical goods retail being the most affected by these delays.
New customer acquisition was another challenge reported by businesses we surveyed, with 18% saying the pandemic has made it more difficult to find or close new business (18%), particularly in consulting, marketing, and technology, and 17% noting the difficulty of a slow funnel. And, while the majority of these challenges require extensive planning and pivoting, some can be addressed through improved and intensified communication with clients and prospects.
Workforce wobbles and shifts in customer behaviors
With so many employees still adjusting to the abrupt changes, especially working from home, it wasn’t terribly surprising that our respondents reported workforce productivity struggles, with 16% saying it has not all been smooth sailing. Employees in industries that have continued working all throughout the pandemic, like call centers, developer tools, electronic design automation, and even online content producers, are all dealing with this challenge.
Naturally, consumers have new needs and priorities brought about by the shifting landscape, as well. Our survey revealed that for 15% of businesses, chargebacks and refund requests are on the rise, most notably among merchants selling digital goods such as multimedia software or computer programs.
What’s next? Merchants prioritize for the months ahead
Despite the uncertainty and turmoil associated with COVID-19, businesses are in a unique position to weather the storm while helping customers do the same.
Launching new products and running promotions and special offers seem to be the main priorities for 38% and 40% of merchants, respectively, in a post COVID-19 world. System utilities, desktop tools, and business software merchants are increasing promotional campaigns, our survey showed, and new product development is a go-to solution for merchants in industries like communications, developer tools, or even legal services. 28% of the surveyed merchants told us they are also prioritizing upgrading strategies and increasing client lifetime value.
Another shift brought about by the pandemic, for 24% of the businesses we surveyed, is focusing on churn reduction and customer retention, while 22% are looking to expand business in new markets. Businesses are especially focused on fighting customer churn in software markets, with both desktop and internet software, hosting, and middleware as the groups most focused on retention this year. Companies in consumer electronics and education, in particular tell us they are putting in increased efforts to bolster their acquisition efforts.
Taking the opportunity to look inward and optimize their on-site ordering experience and conversions is being explored by 17% of surveyed merchants, while 13% are looking to work on positioning, packaging, and pricing in order to adapt to these changing times.
The dramatic impact of COVID-19 on eCommerce cannot be denied, as is illustrated by the responses from 800 global businesses who participated in our survey. Some companies have thrived despite the lockdown and the almost-universal move to remote work, while others say they see the pandemic as a critical and significant threat to their business.
To counteract challenges, and even adapt to the new “world order,” online companies are looking to improve their offerings through adapted packaging, better client service, optimized processes, and improved communication, which – in the long run – will result in overall improved digital commerce at a global level.
To see all the results of our survey in detail, visit our detailed overview here.