Retail

Digital Retail Shift Faces Growing Pains

Digital Retail Shift Faces Growing Pains

Now that the digital shift is well underway, the attention turns to keeping the momentum going. New developments are focusing on supply chain, government activity and infrastructure to improve the customer experience as post-pandemic retail finds its legs.

Several of those developments can help SMBs. According to the PYMNTS COVID-19 Tracker, “the question that many SMBs are pondering at the moment is whether they will – or can – put their personal fortunes, including their homes or investments, at risk in order to save their businesses, particularly since even the most confident of the SMBs we studied see a sevenfold gap between the amount of cash they can tap and the number of months it will take to return to business as usual.”

That doesn’t bode well for the necessary investments in infrastructure and customer experience upgrades to compete with Amazon and other established brands that are laser-focused on eCommerce as their main (and sometimes only) point of sales.

Among the companies making accommodations for SMBs is FedEx. It announced an alliance with eCommerce platform BigCommerce on Tuesday (April 28) to make its infrastructure more accessible to SMBs. Retailers that sign up for the new program will receive discounts of up to 40 percent on FedEx Ground and 50 percent on FedEx Express services. The program also offers access to FedEx Home Delivery, which now delivers seven days a week, as well as a suite of return solutions. Retailers will also receive their own FedEx account number for use with any shipping solution, enabling access to help desk services and package management services, such as rerouting.

“Timing of this alliance and offer couldn’t be better for growing businesses looking to build their brand through their own web store that has integrated, competitive shipping options with a range of services to deliver the intended consumer experience,” said Ryan Kelly, vice president of global eCommerce marketing at FedEx Corp. “This pandemic has made it absolutely clear that businesses need options and partners they can trust. For businesses that are only using a marketplace or only have a physical presence, now is the time to own your future.”

While the federal government is moving to straighten out what has been a messy process to access SMB funding in various stimulus packages, attention is turning to more subtle changes governments can make and enforce. The Brookings Institution has recommended a limited but active role for the federal government to stoke the digital shift, including a code of conduct for eCommerce companies that covers defense against online scams and a commitment to worker and consumer safety via PPE and contactless payments.

“Ultimately, eCommerce lives on the dynamism and initiative of the private sector. Public policy can only play an enabling role, tackling market failures and creating an environment in which digital entrepreneurship can thrive,” per the Brookings report. “Already, the crisis has changed the eCommerce landscape, with businesses and customers more willing than ever to interact online and experiment with new services. Governments need to play their part and make sure that the eCommerce sector can reach its full potential in this public health and economic crisis.”

In order for the digital shift to continue, the supply chain must remain intact as the pandemic recedes. A report from the Canadian Conference Board, among others, has raised some concerns in that area. According to the report, the current situation could prompt businesses to adopt more agile ways of modeling supply and demand and sourcing goods.

“Research has shown that digital technologies can reduce costs for businesses,” the report said. “Adopting digital technologies reduces information search costs, facilitates exchanges and provides businesses with new marketing, finance and networking opportunities. “Furthermore, thanks to eCommerce platforms, smaller firms can more easily access global markets, both for buying and selling products.”

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New PYMNTS Report: Preventing Financial Crimes Playbook – July 2020 

Call it the great tug-of-war. Fraudsters are teaming up to form elaborate rings that work in sync to launch account takeovers. Chris Tremont, EVP at Radius Bank, tells PYMNTS that financial institutions (FIs) can beat such highly organized fraudsters at their own game. In the July 2020 Preventing Financial Crimes Playbook, Tremont lays out how.

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