How New Commerce May Offer a Way to Ease the Impact of Covid-19

The UK is a great nation. When hit by the Coronavirus threat, we deployed our stiff upper lip, embraced the notion of Keep Calm, Carry On which saw us through World War II, and continued to brave trains, tubes and buses. We took solace in the fact we were discouraged from close contact and crowds and found innovative ways to greet friends, families and colleagues – mostly by emulating moves our kids found on TikTok.

But it became serious very quickly.

Just over a week ago, the first death as a result of the coronavirus was reported, the number of confirmed cases started to grow alarmingly, all happening amidst a global context where we could start to see where we, as a nation, were heading. 

And so, sure enough, we became very un-British and we started to panic. Social media anecdotes being delivered in real-time, told of shops running out of stock, triggering panic buying. Shelves, even beyond loo-roll, soap and antiseptic sprays are being stripped clean. One in ten people in the UK have admitted to stockpiling. A major behaviour change reflected in the way we shop.

We have moved from a reliance on just in time ordering and delivery to packing tight our cupboards in preparation for 7-14 days home-isolation with the prospect of elderly people self-isolating for up to four months. This shift in behaviour happened almost overnight.

Retail responds

Here are my observations as to how retailers are finding new ways of doing commerce to help with the greatest unprecedented change seen this generation.

Retailers are demonstrating a deeper understanding of people across all their channels in an effort to stave off panic buying and restore some calm. Nearly all the major retailers (Sainsbury’s, Asda, Waitrose and Iceland) have capped the number of products shoppers can purchase in-store. Followed closely by restrictions activated through online and mobile channels. Ocado, which operates purely online, has paused registration of new customers to its website, deactivated its app pushing all traffic to its website, and is encouraging existing customers to book delivery slots well in advance.

Predictably, eCommerce is currently the winning channel - premium online grocery purchases have shot up to by 20% with shoppers spending 26% more time on grocery websites since the beginning of March.

However, we are also seeing the resurgence of visits to independent stores as we struggle to find what we need. Shoppers have reported reverting to local shops to stock up on essentials finding shelves at the big four empty. I predict the renaissance of the local store as community spirit rises.

Food delivery services are experiencing an upside in sales. This could be, in part, because they have started to offer non-contact deliveries, where drivers will call from outside, leave orders at the front door and stand a few steps back as you pick up your delivery. Grocers are implementing the same approach with online orders; Ocado, for example, has already notified shoppers that it will leave shopping at doorsteps and no longer remove unwanted bags or returns to help reduce the spread of coronavirus. Waitrose, Asda and Sainsbury’s are following suit.

The big question for all of us: will food supplies run dry?  

For the first time, retailers are working with each other to establish stock levels and it’s predicted that they will work with suppliers to scale back range and focus on producing and delivering food staples.

Morrisons is to speed up payments to its smallest suppliers to help with cash flow during the outbreak. From next week, suppliers who sell less than £1m of goods a year to the supermarket will receive payments within 48 hours rather than the usual two-week window, benefiting about 3,000 small businesses, more than half of whom are farmers, an initiative to keep the supply chain full.

A new conscience

The Olio mobile app, connects people with each other, so food surplus can be shared with neighbours rather than discarded – consider, the average UK family throws away £700 worth of food each year with £12.5 billion going straight to landfill. 

Whilst not the original intention, the app has become a lifeline for the vulnerable badly hit by hoarding as food bank donations are impacted. A food bank in Coventry said supplies have ‘never been so low’ whilst London’s North Paddington Foodbank reported donations down by 25 percent. 

Retailers are collaborating with Olio too - volunteers now picking up unsold and surplus food from local food businesses and retailers such as Sainsbury’s, Planet Organic, Hello Fresh and Gusto to redistribute to people in the community.

Local Facebook and WhatsApp groups have formed over the last few days to support people in self-isolation, including the elderly, who cannot get to multiple stores to shop or pick up prescriptions. The Barnet COVID-19 Mutual Aid London-based group has already 1.3k members offering help to people in need in the area. Independent stores have now joined the group to offer products and pre-assembled care packages.

Amazon has also removed over one million products claiming to cure Coronavirus from its digital shelves and has blocked a number of resellers profiteering from inflated prices of in-demand products (known as price gouging). It has reported that some sellers inflated prices by over 2000 percent.

As the pandemic sweeps the UK, it seems this new approach to commerce may be helping to alleviate the impact of Covid-19 by responding to our new shopping needs. Retailers are innovating and collaborating at pace to meet an extreme challenge. Maybe, even more importantly, they are doing so with a conscience.