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Some online brands are seeing sales spike, others are plummeting. They are all dealing with myriad other issues putting pressure on the overall business. Some startups are trying out new digital campaigns to try and account for the vast behavior shifts -- all while staying cognizant of the bizarre times we're all in. It's a difficult tightrope to walk, but showcases brand new marketing terrain.
Right now, many brands and retailers are shying away from experimenting with new marketing channels, desperate to cut costs wherever possible while sales are down. But Levi's decided to move forward this month with a pre-planned test of running shoppable ads on TikTok, as it sees the platform as being an increasingly valuable way to connect with customers now, when many people are stuck inside and glued to apps like TikTok.
All grocery stores are seeing a huge surge in sales right now. But for small and independent grocery store chains, who have struggled to remain competitive against increased investments in grocery by Walmart and Amazon, the chance to get their stores in front of new customers is proving to be an especially important lifeline. Mercato, a grocery delivery platform that focuses on small grocers and speciality food stores, said that it has seen a 5,000% spike in orders over the past month, and has been signing up anywhere from 30 to 50 new grocery stores for its platform each day. As such, that provides an opportunity for smaller grocery stores to win over shoppers who previously flocked to big-box chains, if they can provide a better experience for first-time shoppers.
The newfound need for fast, on-demand alcohol delivery has spurred a golden age for platforms. Fulfillment platforms like Minibar and Saucey are proving there's room for multiple players in this category.
As more people experience financial difficulties and become in need of interest-free finances, alternative e-commerce payment methods are seeing bigger interest than ever in America.
For retailers, running heavy promotions during store shutdowns is proving to be tricky. Due to the coronavirus outbreak, large retailers like Macy’s and Nordstrom, along with chains like the Gap, are aggressively pushing seasonal sales to make room for spring merchandise. With virtually all brick and mortar sales down, anywhere from up to 80% to 100% of expected revenue effectively disappearing for large brands, offering discounts is one of the most effective ways to stay afloat right now, said senior retail analyst at Fit Small Business Meaghan Brophy.
Before the coronavirus outbreak, Blue Apron was on life support. The meal kit company reported in February that it had 351,000 customers during the fourth quarter of 2019, down from more than a million at the height of its popularity, and has consistently failed to turn a profit in its nearly three years as a public company. CEO Linda Findley Kozlowski said the company was considering a menu of strategic options including a sale and raising additional capital. But in March, the company started seeing an unexpected uptick in demand, thanks to the coronavirus outbreak.
As the coronavirus outbreak drags on and more Americans do their shopping online, there's been a greater focus on the working conditions in warehouses, and whether or not companies are doing enough to protect their workers from contacting the coronavirus. Some Amazon workers at a fulfillment center in Staten Island yesterday staged a walkout, stating that they thought that Amazon should close the facility for two weeks as at least one worker there has tested positive for the coronavirus.
DTC brands and platforms are passing on revenue from e-commerce as losses from physical sales losses mount. Examples include luxury watch platform Hodinkee, sustainable container brand Corkcicle and clothing rental service Wardrobe, which are using their existing e-commerce backends to help the store locations they sell their products in. This month watch-focused platform Hodinkee opened up its e-commerce platform to allow physical retailers it normally promotes, but are currently shut down for business, as well as watch brands it carries.
Unlike multi-million square foot warehouses, micro centers are typically located in much-smaller spaces within cities, averaging about 10,000 square feet. Examples include platforms like Fabric, which builds automated micro-fulfillment centers for retail clients, with a focus on grocery chains.
DTC brands are going back to their roots by shifting their focus back to e-commerce.
Nike took a hit to its China business during the third quarter thanks to the coronavirus outbreak there. Now, the company will look at what the outbreak, which is ramping up in the U.S., will do to its retail business, even as the company hopes that its growing DTC business and loyalty programs may mitigate the worst of the impact.
China's online retail market is worth perhaps $1.5 trillion, according to McKinsey. The livestreaming app ShopShops is making it extra accessible to stores and boutiques around the world.
People are staying home, and they are probably drinking too. Alcohol e-commerce is seeing big spikes in business, and some are being forced to delay shipments because of the added strain. These sales were already on the up and up, but this acceleration might bring booze to the e-commerce forefront.
Alex is a 22-year-old social media manager for a startup. Six months ago, while standing in a crowded No. 3 express train on the way to work, he had a panic attack. “I was staring at my phone, trying to simultaneously respond to a Slack message from my boss but also scrolling through Instagram and texting a friend when I thought I was going to die,” says Alex (who didn’t wish to use his last name because he doesn’t want to be known as “the depressed guy” at work). “I literally thought I was being crushed under what felt like a mountain of work, overwhelmed, and messages were coming at me from everywhere, and I just wanted to die.”
To engage users and improve customer profiling, CPG brands are closely studying consumers as they begin to research products on the company's website.
DTC Twitter is obsessed with Tweet threads. Or, at the very least, they are frequently cited as recommended reads in industry newsletters like 2pm Inc. and Lean Luxe, and often serve as inspiration for further discussions in Clubhouse, Slack, or virtual events. Heavy Twitter usage is not unique to the DTC startup scene, but these Tweet storms are a good a mirror to expose the strengths and weaknesses of DTC startups.
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