24 April 2020

A view from Germany on the impact of the Covid-19 on eCommerce

In this blog post we take a look at how Covid-19 has impacted the German eCommerce market and then share recommendations on how to create a competitive advantage for the future.

We are seeing three key trends we are seeing locally:

  1. Amazon shifts its priorities

The eCommerce giant wants to fill its warehouses with essential products such as food, household, sanitary and cosmetic items. Orders with these products will be given priority in the warehouses and less urgent ordered products will be delivered later. This will be at the cost of FBA sellers and vendors from other categories.

  1. Long-term change in purchasing behaviour

Providers such as Rewe and Picnic, who offer online ordering and home delivery, are currently experiencing a boom. Sometimes the demand is so great that there are longer waiting times. The uncertainty about the coronavirus is breaking up habitual shopping behaviour which has been cited by the independent Cologne IFH Institute.

  1. Media spending under review

Due to restricted opening hours, a change in consumer behaviour and the difficulty of knowing how the situation will develop in the future, advertisers are handling their advertising budgets very carefully.

Unsurprisingly, as global stocks take a downward turn, companies with ‘Digital Availability’ are experiencing growth. It is therefore imperative to act quick and appropriately. Those who position themselves positively can create a competitive advantage for the future.

Here are our top recommendations for German brands to stay ahead of the competition:

  1. Behind the shelf

Ensure you have sales partners with online platforms as well as your own shops. Simultaneously, capitalise on non-Amazon eRetailers, especially if they have the appropriate storage capacity and not just fulfilment centres; a balanced mix of eRetailers is key.

  1. At the shelf

Social commerce will become even more relevant. It’s therefore key to have a stronger focus on the user experience. For example, avoid irrelevant offers, simply the purchasing process and shorten loading times, especially on mobile.

Secondly, be mindful of the user demographic, so take different age groups into account when thinking about your advertising and content design.

  1. Post shelf

Invest in your brand. Trustworthy brands will be even more important in the future.

Also, make sure you keep an eye on your inventory. This is especially important if you’re investing budget in eRetail media. Advertising campaigns can help empty warehouses even faster. You should therefore rely on a close relationship with your agency and if possible, integrate their BI or ensure you have dashboards that help you analyse figures quickly and correctly.

 

Petra Schmidt, Head of eCommerce, Germany  

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