LiveArea COVID-19 Business Research – Agility The Key To Survival
May 27, 2020
Author: Elliott Jacobs
LiveArea surveyed 1000 senior managers from UK and US businesses across all verticals to explore the impact the pandemic has had on their businesses and operations, and understand their concerns and priorities moving forward. View the research findings in full here.
Covid-19 will have a lasting impact on UK businesses. The pandemic has shone a light on the glaring vulnerabilities in our businesses, from tight margins and weak supply chains, to ineffective customer communication and delivery. In a post Covid-19 economy, the key to survival will be business agility.
And a facilitator of agility is digital. We know how important digital technology is for brands and retailers, from marketing and digital commerce to warehouse automation and fulfilment operations. But never has digital been as important as it is today. This enforced disruption may have a huge impact on fast forwarding the trend by many multiples.
Having surveyed 500 UK business, LiveArea found 50% of businesses still operating say they will invest in digital technologies as a result of the Covid-19 pandemic, with IT infrastructure (57%) and digital commerce (41%) the most popular areas for investment, with a quarter of businesses claiming they will invest in automation.
For those that lack the agility to invest or build upon a strong digital footprint, this could be highly damaging. Many will use the pandemic as an excuse for longer-term structural failures and failure to adapt to an increasingly digital environment. For those that do survive this period, it should be a catalyst for change.
For those that lack the agility to invest or build upon a strong digital footprint, this could be highly damaging. Many will use the pandemic as an excuse for longer-term structural failures and failure to adapt to an increasingly digital environment.
For those that can and have adopted digital commerce, there is hope. They will not only find themselves better equipped to rebound when things turn around, but will also find that they have strengthened bonds with existing customers and connected with new audiences.
Even for those that have embraced digital and have robust logistics operations, issues around cashflow, staffing, and a lack of clarity pose their own unique challenges.
One problem many businesses face is keeping distribution efforts at capacity. Orders must be fulfilled to generate revenue and continue paying staff, but efforts are often hampered by social distancing regulations. Businesses must ensure their distribution centers – whether owned or outsourced – remain functional. This can take significant time and resource to implement, train, and maintain, and the knock-on inefficiencies may impact delivery times.
This is where investment in warehouse automation will reap its rewards. The likes of Boohoo and Ocado in the UK, for example, have embraced AI and robotics at the center of their warehouses, not only increasing picking and packing efficiencies, but minimizing human involvement.
In terms of digital commerce, marketing and the concept of ‘omnichannel’ has been disrupted once again, and it’s the agile brands that are again likely to prosper in adopting new approaches here. Every part of the customer journey – discovery, research, transaction, customer care, retention, and advocacy – should now be reconsidered digitally. Those brands and retailers with a digital ecosystem to support every touchpoint, whether internally or through outsourced partners, are the most likely to thrive during this difficult time.
Outsourcing services such as IT, customer services, and marketing are viable options to allow short-term business continuity, whilst remaining agile.
With 46% of UK businesses having to furlough staff, and 49% reducing working hours, many face difficulties in continuing operations, and getting back up to speed to meet future demand. For those that have had to furlough office staff, outsourcing services such as IT, customer services, and marketing are viable options to allow short-term business continuity, whilst remaining agile.
If considering outsourcing in these areas, digital marketing, merchandising and analytics teams will be more critical than ever during this time. With consumer confidence likely to be low, conversion rates will become a key focus, and therefore it’s vital to keep a tight grip on how visitors are interacting with eCommerce sites. Budgeting will also be key, for many this may present itself as a kind of second peak period that they had not accounted for, so allocating advertising and development spend in the correct areas should be a priority.
Decision-makers can use the pandemic as a real reason to fully embrace agility. This is the catalyst for change, to make structural business changes, with less friction from others within the business. Now is the time to focus on digital technologies, agile operations and fulfilment efficiencies. No one will know the exact impact on consumer behaviour, so businesses need to build a strategy that can adapt instantly.
Fundamentally, that means following a digital-first approach – developing the technology and culture to put online first. Those unable to make the shift are unlikely to see the end of 2020.
Author: Elliott Jacobs
Elliott is Director of Agency and Commerce Consulting at LiveArea EMEA. He is an experienced global commerce and multi-channel retail professional, specialising in helping B2C and B2B companies achieve measurable success by reviewing current strategies and processes, and identifying and capitalising upon emerging digital opportunities.