While the pandemic demands primary attention, the collateral effects of it are likewise drastic. There has been nothing quite like COVID-19 for companies. The economic damage has been catastrophic, with furloughs and closures happening across the globe. The International Monetary Fund reports that the global economy is in the worst state it’s ever been since the Great Depression, shrinking by an estimated 3% this year. Yet one company is not only thriving but playing a crucial role in this crisis – Amazon.
Turning to Technology
Changes in consumer behaviour were immediately evident once lockdown and social distancing measures were established. The lack of options for physically visiting stores as well as the general fear elicited by the pandemic have left consumers with one logical choice: utilising technology to make their purchases. While in the past, many consumers browsed at online shops and made their physical purchases in brick and mortar stores, the entire shopping experience is now confined to the digital arena. A trend that is likely to continue as studies have shown that even after the COVID-19 pandemic, consumers may still be more inclined to shop from the comfort of their homes. And with Amazon providing consumers with everything they need in one place, it has been able to provide vital services that may change shopping habits forever.
Adapting to the Next normal
While the company swiftly adapted to new consumer behaviour, they still had difficulty meeting the one-day or same-day delivery demands – especially as essential grocery items were some of the most sought after purchases. The pandemic affected all aspects of the supply chain, including commercial fleet operations which decreased early on in the pandemic. This was most evident in Europe, with the fleet data on Verizon Connect reporting that the reduction of hours driven in Ireland, was at -40.6% in April. Luckily, there has been continued recovery for fleet-based businesses due to the increase in online orders, and Amazon is leading the way in this regard. It has even taken on the UK’s biggest supermarkets in delivering food. A key reason why Amazon is expected to emerge from the crisis bigger and better than they previously were – especially with the help of consumers.
While Amazon had already begun to change retail habits for both brands and customers, more consumers are shopping online now than ever before. This behavior is set to continue, whether for reasons involving safety, convenience, a wider variety of options, visible price comparisons, or simply reviews from previous customers. As such, the entire retail industry is going through a reckoning. Amazon’s Hybrid Sales Model is the blueprint for brands who are looking to tap into this online marketplace. This dramatic shift to online sales is urging brands to evaluate and expedite their digital strategies in order to stay afloat. Whether this means establishing e-commerce shops of their own, or transferring their shops to Amazon’s marketplace, online shopping has been extended from a temporary alternative to the future of retail for many.
During this health crisis Amazon switched from becoming merely convenient to becoming an essential service for people across the globe. As lockdowns were enforced (and may continue to be), Amazon became the primary source of shopping for many. And the company will be one of the few that comes out of the pandemic, not only unscathed but bigger and stronger than ever.