Much as we wish the pandemic was over, the beginning of this year feels a lot like the end of last year. Many of us are still wearing masks, still working from home, and still trying to remember what it felt like to buy something on a whim without thinking about the supply chain.
So it's possible that we already know what to expect in 2022. But what if we're wrong? What if this turns out to be another year of continuous disruption for the logistics industry? Our best approach to the year ahead is to stay flexible and keep building on what we've already learned.
Last year we devoted a lot of real estate in this blog to the convenience of omnichannel fulfillment — the ability to begin a transaction in one channel and end it in another. In January, March, April, and September, we wrote about how retailers of every size and description were modifying their operations to accept orders online and fulfill them pretty much anywhere because they couldn't invite customers into their stores.
We talked about losses suffered by shopping malls where foot traffic was down by almost 50% year over year. We also discussed new technologies like BOPIS/BOPAC that allow people to shop online and pick up purchases from the safety of their vehicles. We described how customer expectations change when a store is no longer a store because it's a website, a mobile phone, a store-within-a-store, or an "endless aisle" digital showroom. And we talked about how all commerce is local commerce when orders are fulfilled at our front doors.
In short, we described an incredible societal shift in the way people shop that will have long-lasting implications for retail sales, marketing, and distribution for years to come. While most experts agree that universal omnichannel commerce was coming anyway, it's obvious that Covid encouraged its adoption much faster than anyone expected.
Consumer driven e-commerce
In May, June, and November, we made the case that e-commerce was the big winner among sales channels in 2021, growing faster than any other channel in a year of generally mixed results because consumers, still uneasy about venturing into crowded public places, pressed local merchants to offer online ordering, flexible payment options, and at-home delivery. National chains and e-retailers also reaped the benefits of remote orders; Amazon's annual Prime Days event sales reached a record high of $11.2 billion.
Like omnichannel fulfillment, the global pivot to ubiquitous e-tailing ramped up in 2020 and continued into 2021. By the end of last year, e-commerce accounted for 13% of total U.S. retail sales. Consumers may have started shopping online for safety reasons but it didn't take them long to realize that it's very convenient to order groceries (or almost anything) and have them delivered to your door instead of making that trip to the store.
We observed that the massive uptick in home deliveries exacerbated problems in a last-mile logistics model already plagued by excessive traffic, inaccessible apartments, and costly porch (lobby) piracy, especially in big cities. Many brands accustomed to moving inventory to a few stores or a regional warehouse were just not prepared to ship orders to millions of locations at the same time.
In February, August, and December, we featured stories about the need to transform retail experiences in order to put people first. We highlighted the changing relationship between consumers and brands as everyone became more aware of disparities in income, healthcare, and even access to technology based on geography. We also touched on the "Great Resignation" and the importance of respecting front-line employees who go to work every day in hospitals, schools, restaurants, and stores.
Finally, we wrote about the need to support local merchants who don't enjoy the advantages of being a global retailer with a robust e-commerce platform. We noted that 80% of black-owned businesses are in urban markets, and that 41% of them closed during the first months of the pandemic. And we pointed out that inclusive brands that behaved as if they exist in the same world the rest of us inhabit were able to expand their audience and bring in new customers during even the darkest times.
About CURA Resource Group
We launched Cura Resource Group more than a decade ago because we saw an opportunity to help direct sellers meet the needs of diverse customers in large cities. Even then, we knew convenient brick-and-mortar sales centers that allowed distributors in urban neighborhoods to walk in and fulfill orders locally and on their own time could reduce distribution costs and improve customer satisfaction.
When COVID arrived, much of our thinking about how to provide safe, flexible omnichannel pick–up and return options turned out to be prescient.
There's every reason to think the coming year is going to be a lot like the last one. Our plan is to continue to build on the practices we adopted to keep us all safe - omnichannel everything, consumer-driven e-commerce, and people first - to help our clients keep moving forward in the months ahead.
Contact us today to learn how we can help you stock fast-moving inventory for quick, convenient, and safe distribution to your customers in underserved traditional delivery areas.
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