The Pivot From Retail to Ecommerce
How Doughp went from a high-traffic retail experience to an ecommerce winner
By now we’ve all heard about the thousands of businesses that pivoted to ecommerce in the wake of the pandemic last year. What we haven’t heard as much are the lessons companies have learned in the process and about the way that consumers have become more educated in the ways of logistics.
Israel “Iz” Moreira, the co-CEO of Doughp, knows a thing or two about this subject. Prior to 2020, Dougp was heavily reliant on its three brick-and-mortar stores and the foot traffic they brought in. But Moreira saw the potential of expanding the company through ecommerce channels, and, luckily, had been establishing the infrastructure for that pivot even before COVID-19 forced Doughp to close its retail doors. With a now fully-online company, Doughp has started to centralize and increase its shipping capabilities and has seen success, but it wasn’t a cakewalk. Moreira explains some of the hardships Doughp faced on its journey to ecommerce success, including how little information sharing there still is in the business world when it comes to cold shipping.
“If you talk to some specialist companies in packaging and box design and coolant design, then yeah, they will know everything, but it’s proprietary information because it’s their product,” Moreira says. “So, they don’t want to be sharing this with many people. So, you don’t find a lot of that information online consolidated in a how-to book. That’s the first problem. The second problem is we had grocery stores operating before all this happened. Now, obviously that trend of going into ecommerce was already happening. But when the pandemic hit, it just accelerated exponentially. So, the speed with which the information was shared was not equal to the speed with which people needed that information. So, we have this major gap right now in which some players know what they’re doing and some players are still trying to figure it out.”
Doughp did figure it out, and customers flocked to the company to get their hands on some delicious dough. And when they did, Moreira was ready to do some AB testing on them to figure out the best path forward for the company and its bottom line.
“We’ve run many, many tests around shipping,” he says. “In the very beginning of the pandemic, people were more sensitive to the free shipping messaging. You were testing free shipping against the $2.95 shipping. Free shipping would convert like crazy versus the $2.95. Whereas now, it seems like people are more understanding of the world situation and how shipping works and how expensive it is for brands to ship. So, right now, the latest test that we ran about shipping, we didn’t have a very significant variance in conversion between a $9.95 shipping versus a $7.95 shipping. So, giving discounts on shipping right now is not as relevant as before.”
Turns out, customers are not as spoiled as most brands think they are, and in fact, many customers are willing to support local or niche businesses over the big box brands. Those customers don’t just do that out of the goodness of their hearts, though. Brands need to work to get their attention, which Morsiea says comes down to differentiation.
“As you go into a commoditized industry, leading with the mission is more important,” Moreira says. “If you’re not in a commoditized industry, then your product has major differences against its competition. So, it makes sense for you to lead with more of your product and how it is and why is it better than a competition. Although we have differences from our competition, it is a more commoditized product. If you go to a grocery store right now, you’re going to find Pillsbury, Nestle, and other big brands right there. So, leading with the mission in this case, I think, is more relevant.”
To learn more about the lessons learned in an ecommerce pivot, tune in to Up Next in Commerce, here.
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