Secretary of the Treasury Steven Mnuchin warned that unemployment rates could skyrocket as high as 20% (for perspective, the Great Depression saw unemployment peak at 25% in 1933). During this time of economic uncertainty, e-commerce websites and online businesses are in a unique position. Most responsible employers and the employees who work for them are taking part in social distancing. This translates into working from home, and limiting contact with friends, family, and co-workers. On one hand, folks have more time to spend at home on their computers. On the other, they’ll likely be experiencing more financial hardship than usual. So, what does this mean for e-commerce and online businesses?
6 Ways to Mitigate the COVID-19 Crisis for E-Commerce and Online Businesses
At this moment in our nation’s psyche, people are on lock-down mode. They’re scared. Economic uncertainty leads to conservative spending, which is smart for consumers, but where does that leave small entrepreneurial businesses struggling to breakeven each month? Here are six concrete steps you can take to help your online business survive and thrive during these uncertain times:
- Offer Payment Plans- Cash flow is a problem for many Americans right now, so offering different payment options for your e-commerce goods or services will help stabilize business. If you’re selling a product online for $300, consider offering a 4-month payment plan. Car dealerships and appliance retailers have been onto this for ages (because it works).
- Rethink Your Profit Margins- During the COVID-19 pandemic, you might need to rethink your profit margins. Now is not the time to be maximizing profits. Rather, it is the time to be smart, frugal, and empathetic. How your business responds in this time of crisis will speak volumes to its long-term success.
- Actively Communicate with Your Customers and Clients- You have brand loyalty with your past and current customers and clients, so make sure you utilize that relationship. Be honest about your need for support. People are always willing to help.
- Be a Leader- Do NOT contribute to the sense of panic online. Be pragmatic, factual, and calm in all outgoing communications. Do NOT play into the hysteria to increase your sales. Fear tactics might boost sales temporarily, but they will stain the reputability of your company forever.
- Offer Specials/Discounts- This is a great way to move old inventory and encourage new sales. Run a holiday-type special or offer discounted service packages.
- Engage on Social Media- Don’t let people forget you exist. Post regularly on social media to stay front-of-mind with potential customers and clients.
Remember…It’s Just Temporary
The Coronavirus pandemic of 2020 will be something that defines our generation. You have an opportunity as an e-commerce or online business to set the script. Be a model for other companies to look toward. Yes, this is frightening. Yes, the economy is in tough shape. Yes, business is going to be tough. BUT…this is all temporary. Eventually, the pandemic will subside, and our society will find a new normal. It’s your responsibility as a small business owner to weather the storm with grace, leadership, and pragmatism.
Stay safe and be kind. Questions? Contact PSM Marketing.