How Top eCommerce Marketplaces Are Resuming Operations Amid COVID-19?

Just as we were taking our baby steps into 2020, looking forward to a promising start filled with a lot of hope, everything came to a crashing halt with the outbreak of the Corona Pandemic. The World came to a standstill and brought the economy to a new low. With the rapid spread of Covid-19, all the world leaders had to take a stand and opt for people’s safety over everything else. Thus putting the economic development on the path of one of the greatest recessions in recent history.

People’s day-to-day life was affected as the complete shutdown was implemented by their Governments. India went into lockdown on March 25, 2020, restricting over 1.3 billion people, making it the largest in the World. This in turn affected every industry in the market Globally. The Dow Jones Industrial Average Index(a stock market index that monitors the share prices of 30 of the largest American companies) plummeted to around 8,000 points from February 12 to March 11, 2020.

United States; Yahoo; Weekly statuses from January 1 to August 26, 2020; end of week closing prices

Source: Statista

One of the biggest changes the eCommerce industry saw was the shift of purchasing behaviors in consumers who switched from offline purchases to online purchases. They started procuring everyday goods like groceries and other essentials from online retailers. On the flip side, one positive outcome from this shift being- retail websites generated over 22 billion visits in June 2020 alone, which is a staggering increase from 16 billion global visits in January 2020.

So, how are the top eCommerce Marketplaces are resuming operations amidst the challenging COVID period?

Given the uncertainty of the current situation, lack of prior experience, and no hard-set government guidelines, the only possible way to rise from this situation is through experience and sharing the knowledge with each other.

No two situations are similar to one another when it comes to crisis management. However, here are a few lessons that can be widely applicable and used across different branches of eCommerce to help cope with its growth during this pandemic recovery phase.

1. Studying the new consumer habits that have arisen

2. Innovating around new consumer demands and requirements

3. Adapting to recovery strategy by location

4. Looking for opportunity amid crisis

5. Understanding the various recovery speeds of different sectors

6. Adopting a bottom-up approach to complement top-down efforts

7. Using social media to coordinate employees and partners

8. Proactively creating clarity and security for employees

9. Reallocating labor flexibility to different activities

10. Preparing for a faster recovery rate than the expected one

Now, let’s see what are all the measures taken by our Top eCommerce Marketplace leaders to rise back up.

1. Uber:

One of the worst-hit sectors in the sharing economy platforms is the ride-sharing and hailing services. Uber being the kingpin in the business, has taken some quick and extensive measures to resume operations as safely as possible. Studies have shown that in the second quarter of 2020, Uber’s worldwide ridership reached just below 1.7 billion trips. And compared to the 1.7 billion trips in the second quarter of 2019, this number indicates a decrease in a whopping 56 percent year-on-year growth.

Some of the operational strategies used during the pandemic are:

• Uber has ceased the ‘Uber Pool’ or its share-riding option till further notice. Also, it has brought in strict rules that only two passengers can ride at a time.
• No rider will be allowed on the front seat. They must sit in the back seat and open windows for ventilation as A/C is not allowed per government regulations.
• Uber has given the passenger liberty to cancel the trip without penalty if the driver is not wearing a mask and visa versa. i.e Drivers also have the same liberty of canceling rides if they feel that the safety measures have been compromised by the rider.
• They have put in a “3-Step Checklist” for drivers wherein, they have to wear a face mask. And each time they log in they have to upload a photo wearing a mask. If this is not followed, the trip will not start. To add, before every trip, riders have to confirm that they have washed or sanitized their hands. Thirdly, drivers must verify they have washed and sanitized the vehicle every day.
• Uber has also recommended the government application “Aarogya Setu” to all its drivers.

2. Amazon:

This eCommerce giant has also fallen prey to India’s nation-wide lockdown and the restriction of the goods allowed to ship across the country. Globally, it incurred over $600 million COVID-19 related costs in the first quarter and still expects it to cross over $4 billion in the second quarter.

From food/groceries to healthcare items, the retail giant prioritized delivering high-priority products and canceled orders containing lower priority items. Moreover, to reduce the impact of these cancellations on seller partners, Amazon is refunding all fulfillment and referral fees.

Some of the operational strategies used during the pandemic are:

• From groceries to healthcare, Amazon has prioritized delivering high-priority products and canceled lower priority items. Moreover, to reduce the impact of these cancellations, Amazon has initiated refunding all the fulfillment and referral fees.
• To protect their customers, they have removed over half a million offers from their stores due to COVID-based price gouging, and suspended more than 6,000 selling accounts globally for violating the fair-pricing policies.
• In March, it opened over 100,000 new positions across fulfillment and delivery networks. And after successfully filling those, they announced another 75,000 jobs to meet customer demands.
• As per CDC guidelines, the Alexa health team has built a program that helps detect their risk level of COVID-19 at home. Currently, these have been released in the US and Japan(with the Japanese Ministry of Health, Labor, and Welfare guidelines)
• Amazon Web Services is also playing a pivotal role during this crisis. It helps organizations to access scalable, dependable, and highly secure computing power. From critical healthcare workers, students to keeping employees online, thus increasing productivity from home.

3. Netflix:

One marketplace platform that saw huge profits during the pandemic is the video streaming business platform. With over 16 million subscribers in the first quarter of 2020, and it still predicts an addition of around 2.5 million subscribers by the end of September.

The only drawback during the pandemic being, the movies, and series that were slated to shoot this year have been pushed to the next year.

These aside, though Netflix is one of the few contributors that are making this confinement at home situation bearable, there have been many rules and regulations implemented in order to restrict the usage of the internet. In order to implement it, the Telcos have called on the video streaming service providers to temporarily migrate from HD (high definition) to SD (standard definition) streaming. Further, they have even asked to dispense the heavy bandwidth consuming advertisements and pop-ups to ease network load. They said this would enable video streaming platforms to continue a suitable level of service but at appropriate bit-rates thus easing pressure on networks.

4. Airbnb:

Being cooped up inside your accommodation with next-to-nil access to the outside world will certainly call for at least a mini-vacation once there has been a bit of leniency in the lockdown rules. And ever since partial lockdown came into existence all are preferring isolated first or beach destinations rather than mainstream hotspots.

Along with coming in terms with the rising demand for these destinations, there are many rules and guidelines that need to be put in place in order to make the stay safe and reliable to the tourists. And hence, the vacation rental online marketplace- Airbnb has geared itself to resume optimum operations by preparing for the future of travel with enhanced hygienic initiative.

Some of the operational strategies used during the pandemic are:

• They are offering certification programs to empower the host community with the specifics about COVID-19 prevention such as the use of personal protective equipment, disinfectants approved by regulatory authorities, and, any more.
• As hosts enroll for the program, guests are notified who can then quickly identify and book accommodations accordingly
• As per the US Centers for Disease Control and Prevention (CDC) recommendation, they have also implemented a 24-hour waiting period before entering the chosen rental accommodation.
• Along with pandemic cleaning protocols, they have brought in some new rules as well. One among them is Booking Buffer. According to this, if the hosts are unable to commit to the cleanliness protocol, the vacancy period will be extended up to a certain timeframe. And currently, it is set at 72 hours.

5. Nykaa:

Being a lifestyle and retail giant, Nykaa which is an omnichannel player started off early on the road to recovery by operating right from phase-1 of the lockdown. As the government defined essentials to include products for personal hygiene, skincare, haircare, and many more, they converted their websites to procure those demands. And by adapting to the hyperlocal delivery model they recorded a turnover of 10%-15% off their business-as-usual.

Some of the operational strategies used during the pandemic are:

• Since the first lockdown was announced in March, Nykaa immediately started taking pre-paid orders only for hand sanitizers, napkins, personal hygiene products, and other dier essentials as they were the most sought-after products among others. Though with longer delivery timelines, it saw an increased inflow of orders.
• Nykaa had large amounts of inventory available in its physical stores. Though these stores shut amid the pandemic, they were converted into local warehouses. Being an inventory-led retailer it also started taking telephonic orders and hence helped bring down the supply chain cost drastically.
• Considering the constraints of the warehousing facilities, Nykaa didn’t accept orders below ₹ 1,500. This hiked the average order value up by about 30–40%.

They turned “8” amidst this lockdown and did a ‘Nykaa-turns-Eight’ celebration, and nudged customers to buy essentials and even a few non-essentials as well.

Recently, there was a webinar conducted on The Strategies for Growth in eCommerce Marketplaces Post COVID-19, which saw a congregation of experts from eCommerce giants like Amazon, Payoneer, DHL, and SellerApp who discussed some of the most critical issues of the current eCommerce business situation like,

· How global lockdowns are impacting consumer demands

· How the current situation is impacting the ongoing businesses

· How to prepare for upcoming events

· The best ways to utilize this dormant period of lockdown

All the companies put together, the key takeaways of this meet were-

· Minimize the fear of buying from cross-border regions

· Importance of widening your scope of product categories

· Importance of expanding into new geographic territories

· Research your key competitors and product categories to determine price points, category adoption

· Make sure the lessons you learned about marketing are implemented on your own media channels

· Make sure you’re consistently optimizing your store on the basis of market data analysis

And at the end of the conference, these were some of the key observations that were made-

· Regarding eCommerce logistics- there can be other alternatives to China

· There is an exponential rise in hiring delivery workers to meet the surge in demand for home deliveries

· A new strain of digital shoppers will emerge from the pandemic

· Demand is likely to come from the least expected market categories

The need of the hour is to recover from the pandemic. There is still a long way to go in terms of learning and recuperation from the damage inflicted. However, one should start aiming to grow beyond and accommodate a wider approach to crisis-management in this ever-fluctuating world of eCommerce.