Pandemic-fueled embrace of e-commerce will accelerate digital transformation beyond basics in 2021

By Elizabeth Crawford

- Last updated on GMT

Source: Getty/William_Potter
Source: Getty/William_Potter

Related tags ecommerce Retailers delivery systems Foodtech

While e-commerce may be the posterchild for how the pandemic accelerated technology in the food and beverage space in 2020, it is just the tip of the iceberg as activation and adoption of tech-enabled solutions continue to gain importance in 2021, experts predict.

According to research ​from Mercatus, online grocery sales accounted for only 2.7% of the $993 billion of total sales in 2018 and 3.4% of the $1.02 trillion of grocery sales in 2019, but as consumers looked for contactless shopping options in 2020 to reduce the risk of exposure to the coronavirus, this percentage jumped to 10.2% of the projected $1.04 trillion spent on groceries this year and is predicted to reach a whopping 21.5% of total grocery sales by 2025.

The rapid adoption of online grocery shopping has created new ways for retailers and brands to engage with consumers, but to fully maximize the platform’s potential, access to and affordability of e-commerce must improve in 2021, argues Sylvain Perrier, president and CEO of Mercatus.

He explains that with more Americans unemployed and relying on Supplemental Nutrition Assistance Program (SNAP) and Women, Infants and Children (WIC) benefits to buy groceries, stores will need to make it easier for shoppers to spend their benefits online and discover eligible and budget-friendly products.

He also predicts that high-risk groups will continue to shift to online shopping in the new year and says grocers’ websites must not only meet accessibility requirements but also should offer more support services to help new shoppers navigate the site.

Transparency and fulfillment pose barriers

As more consumers embrace online shopping, retailers and brands also will need to improve supply transparency and fulfillment, or risk losing repeat purchases.

For example, during the height of panic buying in early spring, many stores and manufacturers were unable to efficiently predict and direct inventory where it was needed most – resulting in bare shelves or an over abundance of product stacking up in warehouses, shipping facilities or at manufacturing and production sites.

“Retailers require real-time insights on inventory levels and accurate understanding of true consumer demand, as it impacts the business at all levels, from warehouse labor to distribution to customer satisfaction and profit,”​ Kevin Sterneckert, chief marketing officer at Symphony RetailAI, predicts.

Unified platforms for order fulfillment and picking

He recommends retailers adopt a unified platform for order fulfillment and picking to improve inventory visibility and synchronize inventory to ensure on-shelf availability to improve picking time and reduce the need for substitutions and risk of consumer disappointment.

Perrier adds that fulfillment technology also must track promotions and auto-renewal or subscription programs to more accurately predict demand and avoid out-of-stocks.

At the brand level, adoption of QR codes will take off in the new year as a way to provide transparency to both retailers and consumers about supply chains, ingredients and production practices, predicts Merryfield – a new app that curates clean-label packaged goods.

Digital efficiency, security will become top priorities in 2021

As retailers and brands that were forced headlong into digital transformation in 2020 become more comfortable with the basics, they will need to improve the efficiency and security of their systems, predict Yahoo Small Business experts.

“Many businesses selling online … spent much of 2020 adjusting to the surge in traffic and sales, often at the cost of a lower conversion rate. In order to avoid ‘leaving money on the table’ in 2021, there will be a big push by online sellers to improve their conversion rates,”​ predict Yahoo Small Business senior small business advisors Maria Melo and Vince Dinh.

In an email, they recommend online sellers ask themselves if their website are modern, if social channels are fueling engagement and if digital ad spend effectively is driving traffic and sales.

As companies answer these questions, they predict “outsourcing marketing or working with ecommerce consultants versed on usability best practices and ways to improve conversion rates will increase.”

Cybersecurity also will need to become a top priority in 2021, especially among those who are new to ecommerce, adds Chris Wayne, Yahoo Small Business CTO.

“As digital transformation continues to take place in 2021, there will be more opportunities for bad actors to exploit small businesses. Small business owners must remain vigilant to avoid detrimental attacks, as many do not have the same resources to protect against, mitigate or recover from cyberattacks as larger corporations,”​ Wayne warned, recommending companies invest in security tools and software to provide email security, malware protection and data backup.

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