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E-Commerce Isn’t a Magic Bullet for Small Retailers, But Helps Improve Customer Contact

  • Adopting an e-commerce platform has been a common maneuver for small retailers during the COVID-19 pandemic
  • The strategy can help maintain sales levels, but comes with challenges as well
  • One benefit of using e-commerce is the ability to promote personalized customer service

Summary by Dirk Langeveld

In the early days of the COVID-19 pandemic, as restrictions forced brick-and-mortar shops to close their doors, numerous small retailers found themselves scrambling to set up an e-commerce option. Having such a platform in place gave them a chance to capitalize on the shift from in-person to online shopping while generating enough revenue to stay afloat.

But as a recent New York Times article explains, e-commerce hasn’t always been a simple solution. E-commerce transactions have skewed toward larger retailers, with 68 percent of sales going to 10 major companies in 2020. Small retailers have also encountered logistical challenges, such as having a limited staff to manage these sales or struggling to provide adequate inventory to meet both online and in-person demand.

Even as business restrictions are eased with the decline in COVID-19 infections, e-commerce will remain an important consideration for small business owners. Customers may continue to be wary of in-person shopping until vaccines are widely distributed, and e-commerce has long been growing more dominant as a convenient option for consumers to browse and purchase products and services.

Small retailers with e-commerce platforms can benefit from ongoing “shop local” campaigns to support neighborhood shops. An online presence also offers the ancillary benefit of “conversational commerce,” in which businesses can increase their engagement with customers through social media and other channels.

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