This is no Aesop’s fable. This is about two grocery stores in Sydney, Australia and about their journey thru the Covid Pandemic crisis .
One grocery store located in Liverpool in South West Sydney, is owned by a migrant from India. The store was set-up over 10 years back and was moderately successful, serving a loyal customer base. The store’s strength was personalized service, catering to the needs of South Asians in South West Sydney.
In April 2020, when Australia shut its borders over the Covid Pandemic, and the first wave took hold in Sydney over the Ruby Princess cruise liner debacle, Sydney went into near complete lock down. This grocery store was particularly hit hard as ‘Walk-In’ customers stopped walking in, and panic hit the owner! Many small shops and businesses did not know what hit them ! The Covid Pandemic and the consequent lockdown caught businesses totally unawares. Covid pandemic and its economic cost & consequences was a ‘Black Swan’ event with no precedence.
A chance encounter with the store owner who knew me and about Azure Digital Consulting, sought advise how to handle this ‘existential crisis’ his business was facing. To assuage his immediate concerns, I suggested he set-up an eCommerce store and establish a digital presence for his grocery store. He readily agreed to my suggestion and requested a proposal from Azure Digital. The project included whole gamut of tasks and activities – online branding, ecommerce storefront design, payment gateway integration to facilitate online payment, online security for transactions and for the site, cloud hosting, developing product categories and adding products to the online catalogue, policies and rules for online business and advising on plans, policies and rules for order fulfilment and delivery logistics across Sydney in Phase-1. In Phase-2, which was to be implemented after the site was “Live”, covered ‘Digital and Social Media” Marketing and focusing on customer acquisition. Azure Digital also outlined the plans for delivery logistics. This involved picking, packing and shipping, which was entirely new concept for the store owner. For the grocery store, it was always – customers walking in, browsing , shopping, paying and walking out. This was how it has always been for a ‘Brick & Mortar store !
Implementing eCommerce storefront involved creating an online branding and logo which related to the online nature of the business. There were numerous technical aspects which had to be covered like getting a domain name, deciding on the ecommerce platform-build or buy, Open source or Closed source solution (a.k.a proprietary solution). Then, there was the task of configuring the system to support the business needs, modifications to the system, online security, payment gateway integration, uploading product images, categorizing the products, adding products, product description and pricing. All of these took about 8 weeks. After the systems were designed, developed and deployed for use, it was put thru multiple layers of testing. During testing, few glitches emerged which had to be ironed and also improvised to help User experience. The estore was finally opened to the public around Mid-Jan.’21, when Sydney was relatively free of Covid cases and life was as normal as could be, whilst in other parts of the world, Covid was raging and affecting everyday life.
Azure Digital’s eCommerce Framework
The next task was to launch marketing activities to create awareness about the new Online grocery store, thereby providing the option to the customers to either shop online or continue with the traditional walk-in! Given the limited budget, Azure Digital planned out a few things to create awareness – printed flyers announcing the launch of the eStore and which was distributed around the neighbourhood, created online ads and posted on Facebook and Instagram. Chat module was also implemented to provide chat responses to online visitor’s query, which proved to be a very effective tool to respond to customer queries instantaneously . Product promotions and discount offers were also introduced. Despite these efforts, and the visitors to website registering steady increase, actual purchases were still low, even after 3 months of the eStore launch !
Around March 2021, life in Sydney was humming along fine, and Covid Pandemic seemed distant, not affecting normal life in Sydney, and the state of New South Wales. In another suburb in Sydney – North Parramatta, a leading international supermarket franchise store was changing owners. This supermarket store was located strategically in close proximity to a leading school, business offices and residential units. The supermarket store was in business for over two decades and had developed a loyal customer base. The store had a well-established presence. However, the previous owners did very little by way of automation other than POS system which is a business essential for any retail outlet and rudimentary accounting system. Inventories were reconciled manually!! The previous owners had set-up a process for telephone orders and pick-up, which helped the business and provided its customers – ‘Ordering Convenience’ ! The previous owners had done nothing in terms of having a digital presence, no website, no Facebook or Instagram pages ! The new owners, on the other hand, were keen to have digital presence. In this context, the new owners invited Azure Digital consultants to conduct an assessment and make recommendations around digital strategy for the supermarket store. Given Azure Digital’s familiarity with retail business, carrying out the assessment and making suitable recommendation was not a time-consuming exercise. Broad recommendations were made, identifying 3 areas of priorities to focus on – (a) EStore to facilitate online ordering by customers (b) Mobile App for Take Away Food and (c) to implement a new ERP System to streamline and better manage procurement, inventory and business accounting. However, the discussions over the priorities were meandering, session after session over Zoom Meetings. We also realized with Zoom meetings, the convenience of scheduling and conducting meetings was a breeze as there was no need to commute. As a result, the discussions with the client around the digital strategy were going on endlessly, not reaching any conclusion !!
Meanwhile, the grocery store in Liverpool had overcome initial hiccups , some of which were around transaction security, product categorisation which created some confusion among users and delivery logistics. Social media marketing was the focus. The campaigns on social media platforms helped gain visitors to the website, which in turn helped convert visitors into actual customers who bought groceries from the estore. The owner of the Liverpool grocery was beginning to feel more confident about the prospects from online store. The store owner felt that with the online store complementing his brick & mortar store, his business was better quipped to face lockdowns and movement restrictions in the event of the Covid Pandemic waves occurring again across Sydney.
Towards end of June, Sydney was hit by another wave of the Covid Pandemic – this time it was the Delta variant, which is considered highly contagious and easily transmissible. Within the first couple of weeks of July , the case numbers across Sydney began to increase rapidly. The state government imposed strict lockdowns across Greater Sydney region. People were advised to stay at home and to shop online even for everyday essentials ! This time around, the Liverpool grocery store was better prepared. By end of July, the online sales had increased 100% over the previous 5 months sales put together. As the Covid cases continued to mount across Greater Sydney and even harsher restrictions were being imposed , sales during the month of August continued to rise even further. Walk-in customers to stores almost came to stand still ! This time around the Liverpool grocery store owner was not fazed. The customers shopped online and the Store owner had put in place delivery process, which was in compliance with rules around ensuring ‘Contactless delivery’ . Clearly, the move towards online store proved to be a move in the right direction for the Liverpool grocery store !
The Pandemic wave around the Delta variant which spread rapidly across Greater Sydney forcing the state government to impose stricter lock down came as a rude shock to the Supermarket store in North Parramatta that Azure Digital was engaged in discussions to implement the eStore and other systems. With no digital storefront and Walk-in customers down to a trickle, daily sales plummeted for this supermarket store ! Whilst the Liverpool Grocery store benefited significantly from the stringent lockdown, the North Parramatta store was impacted very adversely. The Supermarket store in North Parramatta was barely able to keep ‘its head above water’, whilst waiting for the lockdowns to be lifted ! Interesting insight from the second Pandemic wave driven by the Delta variant on the two stores was that the impact on the two stores were diametrically opposite.
One can argue that businesses cannot take ‘Knee jerk’ approach to a crisis and rush into doing something which has ‘strategic’ implications to the business. Building an eCommerce platform for a business represents a strategic shift for any business. Hence, it will need to be planned and implemented properly. However, businesses need to be proactive and not reactive. And crises happen without notice ! Are businesses prepared for the next crisis!!