Q&A Jason Linnworks

Q&A With Jason Stuckey From Linnworks – How Merchants Can Thrive Post 2020 Pandemic

After 2020 and the crazy year following, many eCommerce businesses were able to make the most of the situation and saw record sales in their business through the pandemic.

The trouble may lie ahead though as eCommerce giants have fallen foul of their own success from the previous year. Amazon missed their Q2 expectations and saw a close to 10% share drop, and eBay reported that they had lost all of the new buyers they had seen over the previous year.

To try and help you avoid falling into similar traps with your business we are excited to bring to you an exclusive interview with Jason Stuckey from Linnworks.

Jason is an advertising and commerce veteran at Linnworks with over 10 years of experience in digital marketing, eCommerce strategy, and back-office operations. Jason has helped launch successful commerce endeavors for celebrities such as Rihanna, Kate Hudson, Kim Kardashian, and Michael B Jordan and has been an integral part of building over a dozen online and retail businesses. He has a detailed understanding of the eCommerce ecosystem and, in his role as General Manager at Linnworks, he uses this experience to drive successful Total Commerce strategies for thousands of global sellers and brands.

Q1. 2020 was certainly a challenge for many, yet eCommerce in many aspects remained the beacon of hope especially for SMEs. As things are slowly starting to return to normal, how is this affecting eCommerce sellers?

A. The normal Q4 to Q1 dip in online sales is typically around 18-20%. This year it was closer to 12%, which means 2021 online order volumes are still well above pre-pandemic levels.

Volumes in Q2 were relatively in line with Q4 of 2019, which is much further along than pre- pandemic predictions, so it’s clear that spending habits have changed irrevocably as a result of the pandemic. We’ve also seen that despite the easing of restrictions and reopening of brick and mortar, various product categories have continued to show strong growth in online sales, especially in food and beverage as well as pet supplies.

According to a recent Linnworks study, 76% of consumers cite convenience as a top priority. With options like same-day delivery and buy-online and pick-up in-store, retailers can expect the shift to online to stick long-term.

However, many of the challenges that retailers faced last year — worker shortages, product shortages, shipping delays — have also continued into 2021. And on top of these, there have been a string of crises that have majorly impacted the shipping industry — from the Suez Canal blockage in March and April and the continuing effects of Brexit on cross-border trade, to more recent container shortages, labor and supply shortages, as well as logjams in ports. So while online sales remain strong and will likely continue to remain strong, retailers must implement strategies that allow them to both cater to evolving consumer behavior, and also ensure resiliency and business continuity in the future.

Q2. Amazon recorded another record-breaking Prime Day for 2021, only 8 months after the Prime Day for 2020 due to the Covid-19 postponement. Due to the uncertainty that we have seen over the past 18+ months, how hard is it for eCommerce sellers to accurately predict the rest of this year when it comes to sales?

A. Depending on the type of product and the manufacturing structure of a company, inventory planning cycles can average between three months to over a year. This means that seller purchasing decisions for products available today were made during the peak of the pandemic in the western world.

Typically, companies will look at historical data to inform their purchasing decisions. However, with the total disruption of the supply chain, using historical data as a marker for future sales became incredibly difficult.
Similar to consumers hoarding toilet paper at the start of the pandemic, many sellers elected to overbuy or overbid to secure inventory to prevent a situation where they would lose a sale due to a lack of inventory.

That said, inventory is a double-edged sword — too little and you lose revenue from lost opportunities, too much and you lose profit each day the excess inventory sits on the shelf. Many sellers elected to overstock, which has now strained the systems in a number of areas. For example, the computer chip and lumber shortages have now impacted multiple industries’ bottom lines for nearly an entire year.

Q3. We are now in the middle of 2021, which as we know is when a lot of businesses start preparing for Q4, Black Friday, and the holidays in general. What are some of the tips you would give to sellers to help them manage this challenge effectively and efficiently?

A. Consumers expect convenience, from discovery to delivery, now more than ever. By having insights into inventory and stock availability, retailers can better prepare for the unknown and make decisions that still enable them to meet their customer demands. Lack of visibility into inventory can not only hurt current sales, but it can also cause a brand to lose customers if they feel a competitor is more reliable in the long term. If one retailer can’t fulfill an order, there is almost certainly another retailer that can.

In Linnworks’ 2021 eCommerce trends report, when shoppers looked for out-of-stock products during COVID, only 13% returned to the retailer’s website to buy the item, while 37% went to a different store to complete their purchase. On the shipping and logistics front, one key factor in making sure retailers are able to meet these consumer expectations is supply chain diversification.

We’ve seen the shipping industry face challenge after challenge from the pandemic to weather events. Supply chain diversification allows retailers to activate alternative fulfillment and first-mile shipping routes, should one region be compromised. It’s now imperative that retailers of all sizes enable a multi-location supply chain, not just for the 2021 holiday season, but for 2022 and beyond.

Q4. After the rise of eCommerce in 2020 due to global lockdowns how do you envisage the role of in-store shopping changing to adapt to the new experiences desired and expectations from customers?

A. The pandemic forced brands to shift their operations fully online, but in-store retail is still alive and well, it’s just starting to serve a new purpose. Brands are adjusting to accommodate new consumer preferences and shopping behaviors, and they’re taking control of as much of the consumer experience as possible. As stores open back up, brick-and-mortar is just another way retailers are differentiating to maximize their customer experience.

Many brands are experimenting with their brick-and-mortar space by using the space as a showroom or to host experiential events, for example. We’ve also seen increased customer interest in ‘buy online pickup in-store’ (BOPIS), which is an added convenience for customers and retailers alike and offers yet another opportunity for utilizing physical retail as part of the online purchase journey.

Consumers are increasingly privy to this newfound sense of connection to the brands they’re purchasing from. In fact, in the aforementioned Linnworks study, 76% also said they would prefer to shop with their favorite brands directly if they offered the same conveniences of an online marketplace. Luckily for retailers, direct-to-consumer models are no longer solely via their physical store or website. Newer digital shopping channels like marketplace storefronts and social media platforms allow brands to invite customers to shop with them directly. As brands expand and streamline their omnichannel strategy to blend in-store and online, they now have the opportunity to offer a more personalized, direct shopping experience across the board.

Thank You Jason From Linnworks

We want to thank Jason for taking the time to answer our questions and share his insight into how online retailers can adapt to the ever-changing landscape of eCommerce post-pandemic.

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This article is part of our Leadership Series, where industry professionals share valuable insights for small business owners selling online. The views expressed are the author’s alone.  

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