The New Normal of E-commerce
The COVID-19 pandemic triggered a host of new challenges for gift shop retailers, as stay-at-home orders meant customers weren’t allowed in the stores, and even those that could remain open, saw traffic dwindle as people feared shopping inside.
E-commerce sales became more important than ever, but a number of stores didn’t have a solid enough website in place or the tech know-how to handle so many orders coming in at once.
That’s given rise to companies who have started their own e-commerce sites by bringing in a collection of local stores to sell their wares in one place.
COLLABORATIVE HOLIDAY SEASON
For instance, this past holiday season, e-commerce company Upmarket hosted Holiday Village, a virtual Christmas market where local retailers could reach out to more shoppers.
“Two important things were missing from the usual e-commerce experience—curation and community,” said Riley Konsella, co-creator of the Holiday Village. “You can trust that gifts on Upmarket are high quality, creative and new, and that there are real people and stories behind the brands.”
The idea came to Konsella and his co-creator George Ketterer, who had a small retail business themselves, and were planning on participating in some in-person shows before the pandemic hit.
“We started thinking of alternatives and all the friends we had made who ran small businesses of their own, and thought an online market could benefit a lot of us,” Konsella. “We opened Holiday Village in November with 20 small businesses taking part.”
Vendors learned about the market via Konsella and Ketterer reaching out directly, and they tried to target those who had been a part of holiday markets previously or those they met at trade shows.
To become a part of it, retailers needed to pay $250 with a commission on each sale.
“They needed to commit a little bit of product to us, but there was no social media commitment or anything else,” Konsella said. “We wanted to make it super easy for everyone since they were taking a risk putting time into this.”
There were no direct links to the retailers’ websites, with all orders made through the Holiday Village e-commerce platform, but they did link to the retailers’ social media sites.
“The limited time thing was an asset because it passes the customers to the retailer at the end of the event,” Konsella said. “We’re hoping to help them grow their own brands in the process.”
Although it was limited to holiday time, plans are to revive it again in 2021 and the duo is looking into doing similar markets throughout the year.
“A lot of brands seem interested and we’ve had about 100 retailers reach out to us who want to be involved in the future,” Konsella says. “I think there’s a lot of room for this to grow.”
VIRTUAL SHOPPING DISTRICT
Retailers from Chicago’s North Shore have teamed with Tacklebox Brand Partners to offer its own virtual shopping district, called NorthShoreShops.com, a platform that provides a lifeline to local small businesses that have been devastated by the effects of COVID-19.
“There are all the boutique stores in a charming area, and I got to thinking, if small business continues the way it does, these stores are going to drop one by one,” said David Kelbaugh, founder of Tacklebox Brand Partners. “I don’t think ‘shop small’ or ‘buy local’ advertising will have the necessary impact. That puts a band aid on the problem, and we wanted to find a way to solve the problem.”
Many of the shops made the transition to e-commerce, but Tacklebox wanted to make things easier for customers and companies, so people didn’t need to register and sign-out from five different shopping experiences—they could do it all in one place thanks to the virtual shopping it created.
“It offers additional search engine optimization, additional revenue and a way to get new eyes on the store,” Kelbaugh said. “It’s possible people will circumvent the platform and go right to the store, but we are ok with that because it’s helping the store.”
Retailers interested must complete a Google form describing the company, then upload their top 10 products to be part of the site, including the images, and Tacklebox builds out the storefront for the platform.
“We have chosen to fund this out of our back pocket because we think it’s the right thing to do, and we’d love to see this scaled to other communities, such as Martha’s Vineyard or the Hamptons,” Kelbaugh said. “We do mark up the prices of the merchandise by five percent, which covers the Shopify e-commerce engine cost.”
Delivery service for platforms like this will be crucial for success, and Kelbaugh noted that the options are to default to typical shipping like USPS and UPS, or team with one of the companies that are looking to solve the “last one mile” dilemma, such as Postmates, Uber and others. He believes eventually the tech will allow a seamless connection.
One of those delivery services is GOPHR, which is a contactless delivery platform currently operating in Lafayette, Louisiana, where people can order from a variety of brick-and-mortar stores that are available on its local App.
“This is a hybrid solution to save the brick-and-mortar retailers,” said Warren Vandever, CEO of GOPHR. “People are afraid to get out of their houses because of COVID and we can serve as their legs to get what they need from our marketplace.”
To become part of GOPHR’s marketplace, companies can sign up on Facebook and then they get their own web-based platform; when sales are made, they simply input the address and GOPHR will deliver.
“We charge the merchant directly and they can eat the cost or pass it on to their customer,” Vandever said. “We also offer GOPHR Pro, which provides a digital storefront as part of a digital mall, and we will sell the product, handle the processing fee for credit cards and charge the customer for delivery fee. For the store, we charge either 10% or 15% of the gross ticket or we arrange a monthly fee.”
The company plans to expand to other cities in 2021.
Swingbuy is another virtual marketplace for brick-and-mortar retailers in the Pacific Northwest, and gives stores access to a network of more than 250,000 gig-economy drivers around the country enabling same-day delivery for their products. Stores outside of the area can still be part of the marketplace, but won’t have the same awareness component.
“When a store comes on, we have methods that allow them to integrate their inventory and connect that to their POS, and for some stores we are just an on-demand delivery service for them, but for others, we are an online awareness tool as well,” said Kevin Dillon, CEO of Swingbuy.
Currently, Swingbuy takes a 5% transaction fee, plus adds the cost of delivery, but the transaction itself is between the store and consumer.
“All stores need to have is an app on their phone and a way for us to bill them for their delivery service,” Dillon said. “It’s a very smooth delivery experience and that’s what people are looking for in today’s age.