The COVID-19 pandemic has pushed companies to rethink their business models. While e-commerce was in a much better position than any other industry to face this challenge, they also had to undertake certain steps to effectively operate in the new reality.
Not only did they have to meet the growing demand for online shopping, but they also had to come up with completely new products like lockdown beauty kits and COVID-19 testing booths to satisfy current purchasing patterns.
In the following article, we’re going to share with you how 9 e-commerce companies including Room, Zay, and Buymie pivoted their business to better meet the needs of their customers during the COVID-19 pandemic.
What is a business pivot?
Even though the term ‘pivot’ is frequently understood as a drastic business change, it doesn’t always entail changes that shake the business to its core. Rather, it’s the process of addressing an important problem or challenge the company is facing – one that is keeping it from achieving its goals. Therefore, a pivot can mean anything from introducing a new product or service into the business’ offer, through to an entire redefinition of the business and entering a new industry.
1. Keep Your City Smiling
A Seattle-based startup previously known as The Snap Bar sells city-specific gift boxes supporting small businesses struck by COVID-19.
Prior to the pandemic, they provided virtual photo booths, event boxes, and branded selfie strands for in-person and virtual events. The Snap Bar lost all their customers within a week, which pushed the founders into launching a whole new business – a gift box service Keep the City Smiling.
The gift boxes include goods collected from local businesses such as snacks, artwork, coffee mugs, etc. and are sold directly to both B2B and B2C consumers. The assortment differs from city to city, depending on the local specialities.
The majority of their clients are based in Seattle, Los Angeles, San Francisco, and Portland. Keep the City Smiling also prepared a special gift box for healthcare workers in recognition of their work during the pandemic.
The team used Google and Etsy to locally source products for their boxes. They also asked businesses they already cooperated with to spread the word among other similar businesses so that their products can also be included in the offer.
Within a month from launching the service, the brand got $100,000 in sales and dropped the gift box’s price from $75 to $65. Overall, the pivot was a spectacular success.
Room provides office phone booths used for solo phone calls, virtual meetings, or to get some quiet work time. They’re made of recyclable materials, they’re soundproof, ventilated, and modular.
As a way of contributing to the COVID-19 fight and protecting healthcare workers, Room reimagined their product and started producing Test Booths. They modified their regular phone booths and turned them into rapid testing units.
Since they’re made of three walls of unused plexiglass recycled from office phone booths, they are easy to clean and disinfect. You can move them around and assemble them within 30 minutes.
The booth also includes built-in medical gloves and a shelf for placing essential equipment.
Not only does it help with rapid COVID-19 testing but also effectively protects medical staff from contracting the virus.
Selling office phone booths during the pandemic became extremely difficult due to an increasing number of companies adopting remote work. By expanding on their target audience to include healthcare, Room managed to offset the negative consequences that COVID-19 has brought on their business.
Zay is a Kuwaiti luxury e-commerce fashion platform, founded in 2019 by Sara N. AlAteeqi, focusing on sustainability and rentals. The main idea behind launching the company was to empower women to have a say in minimizing environmental waste by the simple everyday activity of growing their closet.
Prior to COVID-19 the store operated like any other online store. However, the pandemic has forced ZAY to pivot its business into a commissioned marketplace platform.
“I decided to turn my current problem into a ‘we’ solution by offering our platform (both our app and website) to small businesses to sell for 0% commission for two months... This way, we created a network effect for all those small businesses joining and helped ourselves along with our extended community grow instead of shutter during this crisis.”
4. M.A.C Cosmetics
M.A.C is a Canadian cosmetics manufacturer with an annual turnover of $1 billion and over 500 independent stores worldwide. The company, like many others, had to close most of its stores and move its operations online.
M.A.C realized that as consumers moved from shopping in-store to shopping online they’d have to find a way to enable them to try on the make-up. They pivoted a technology they already owned – a virtual try-on. The company upgraded the tool with new subcategories and has seen a three-fold increase in engagement post-COVID.
Additionally to moving their sales online, M.A.C Cosmetics has revived its “Viva Glam” campaign, which started during the AIDS crisis.
They planned to relaunch it in April, but due to the COVID-19 pandemic, they’ve decided to pivot it into a coronavirus-specific campaign and to launch it earlier. The brand introduced special lipstick shades, with profits from VIVA GLAM lipstick purchases (without VAT) going to organizations that help vulnerable communities including those affected by the pandemic. They donated $10 million to 250 of those organizations around the globe.
Rosie on Fire is a UK-based online apparel store that offers high-end ladies’ fashion. Launched in 2013, the brand has branches in the UK, Canada, and Malaysia. When the Coronavirus pandemic began, the brand was well on its way towards launching its first offline store and beauty bar in Kuala Lumpur.
When the lockdown commenced, Rosie on Fire decided to go beyond simply optimizing the delivery experience.
They introduced a new, lockdown-related line, SuperCleen, which features items like hand sanitizers and gloves. They also partnered up with a London startup called Jed.ai and created a brand called SupplyDrop, which helps isolated people emulate real-life social events like birthdays or engagement parties. Some of their pandemic-related kits include ‘The Big Hug’, ‘The Graduation’, and ‘The Date Night’.
Naples Soap is a US natural cosmetics company that launched in 2009 as an online store. As of 2020, the brand had over 10 retail locations in Florida and a network of global wholesalers. Prior to COVID-19, both of these distribution channels were the company’s main source of income.
When the pandemic struck, Naples Soap – like many other companies – worked effortlessly towards redirecting their offline customers to their online store. They have also decided to cater to the soaring market demand for hand sanitizer, all the while targeting their high-end customer. As a result, they have launched a premium line of anti-viral hand gel, spray, and food. rinse.
Introducing the new products and prioritizing the online store have paid off – according to eMarketer, Naples Soap sales have tripled just between March and April 2020 alone.
Joyride is a New York-based specialty coffee provider founded in 2011 by three coffee enthusiasts. The business initially operated from the back of a food truck, and has, over the years, grown into a popular quality coffee provider for B2B customers.
When the pandemic started, Joyride found themselves stranded, incapable of making revenue due to mass office closure. However, the company did not wait long to act and they decided to redesign their online messaging so that it’s tailored to individual clients.
As of July 2020, the company focuses its efforts on B2C customers with door-to-door delivery. They have also introduced a new product with a long shelf life – Joyride Boxed Cold Brew.
In an interview for Vending Marketwatch, Joyride co-Founder Adam Belanich stated that:
"COVID-19 may have taken the team out of the office, but it hasn't taken Joyride's core values out of the team. I'm seeing our core values of ‘Innovate Big and Small,' and ‘EnJoy the Ride' exemplified each and every day."
DUER is a Vancouver-based apparel company which started off as an online fashion store in 2013. Over time, the brand has grown its offline presence and has reached over 1000 wholesalers and retail outlets worldwide.
When COVID-19 struck, DUER were launching their spring campaign – their items had already been shipped to outlets and partner businesses all over the globe. However, their sales plummeted by 70% in March, when most stores were forced to close. DUER decided to focus, once again, on its online outlet as the only stable sales channel. The lockdown has also triggered the company to finalize a business pivot they have already been considering before the pandemic.
Namely, they decided to reduce garment production and the number of unsold items, all the while increasing store variety. They have introduced more styles and colors on their website, however, these would only become available for purchase if enough people showed interest. Once a design is accepted for production upon popular demand, it can be shipped to customers within 4 to 6 weeks.
Apart from saving on garment production, the introduction of product prototypes to the website also allowed DUER to reduce the brand’s carbon footprint and decrease water waste.
As a result of these actions, DUER was able to keep its clientele engaged during the lockdown – its e-commerce sales have exceeded pre-coronavirus estimates by 25 percent.
E-commerce after the coronavirus outbreak
When the COVID-19 pandemic started worldwide in early Q2 2020, many e-commerce companies noticed they needed to quickly capitalize on the growing online traffic.
Customers who could previously choose between offline and online shopping experiences were now confined to the latter solution. However, such a turn of events didn’t guarantee soaring online sales to all businesses and e-commerces still needed to put in the work to convince customers to buy through their online channels.
Many companies have prioritized pickup and delivery options by offering quick in-store or contactless curbside delivery. Others have also decided to introduce new products – COVID-19-related items like hand sanitizer and gloves, as well as fashion styles, colors, and washes available exclusively online.
If the pandemic lasts beyond 2020, we can expect e-commerce companies to further optimize their delivery chains, production costs, and to prioritize their online shopping experiences.