Retail, logistics and going omnichannel: all you need to know
Category Commercial and Industrial News
As technology continues to develop, there were always going to be changes in the ways that people shop. The COVID-19 pandemic has drastically accelerated this transformation, ushering in an age of new priorities for retailers and an exponential increase in the demand for warehouses. 3Cube Property Solutions takes a deep dive into everything retailers need to be thinking about in 2021 and beyond.
An ongoing upswing in online shopping
According to the Deloitte Digital Commerce Acceleration Report issued earlier this year, the upswing in online shopping will continue to be driven by concerns about COVID-19 infection, as well as the added convenience factor. In the research that Deloitte carried out, it was revealed that two out of every three respondents indicated that they would shop online more in 2021. To this, the report adds that the South African e-commerce market is set to grow by a compound annual growth rate of more than 9% over the next five years.
The growth in online shopping is clearly visible in the 2021 statistics about etail. For example, in the 2021 Naspers Integrated Annual Report, it is reported the Takealot group's revenue increased by 65% year on year. Etailers have quickly had to change from being geared primarily for season peak volumes in the lead-up to Christmas and Black Friday to being prepared for unprecedented order volumes all year round.
The impact of increased online retail on logistics
Within moments of lockdowns being declared in March 2020 in light of the Coronavirus outbreak, retailers started thinking about ways to survive without their brick-and-mortar presences. For many, the obvious answer lay in online shopping. Working in this new landscape, retailers quickly found that they needed more warehouse space to meet the new demand and make deliveries timeously.
The above-mentioned Deloitte report reveals that there are numerous factors that matter to online shoppers and affect purchasing decisions. These factors include, amongst others, service levels, delivery choices and easy returns and refunds. As businesses ramp up their digital departments, they need logistics space to be able to offer the levels of service that are required by online shoppers who are spoilt for choice.
Many South African etailers have made great strides in their customer service offering. Takealot, for example, reduced its late deliveries percentage from 4.5% in December 2019 to just 1.3% by 2020. On a similar note, Takealot has expanded its network of click-and-collect points from 45 to over 80, providing its clients with flexible delivery options.
Going omnichannel
Over and above the increased trend towards online shopping, shoppers are demanding omnichannel shopping experiences. Omnichannel means that there are various ways to shop, including in-store, online or click and collect. In an interesting case study, Liz Hillock, head of online and mobile for Woolworths, explains how the pandemic accelerated the South African retail giant's omnichannel efforts. In the early weeks of the lockdown which started in March last year, Woolworths launched their click-and-collect service. Over and above this, in a time when customers were not allowed to try on makeup in store due to health concerns, the brand launched its "Virtual Try On for Beauty" service, which is a virtual try-on tool that shows online shoppers what a particular makeup shade will look like on them.
In a world where online shopping and omnichannel retail are growing exponentially, every retailer needs a commercial and industrial property expert in their corner. 3Cube Property Solutions can help with all your retail space and warehousing requirements in Gauteng. Contact us for more information.
Author: 3Cube Property Solutions
