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When E-Commerce Saves the Day

SBJ Economic Growth Survey: Silver Linings: Companies use online sales platforms for big advantages amid the pandemic

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After eight years operating a brick-and-mortar women’s clothing boutique, owner Lisa O’Dell decided earlier this year to take her business exclusively online. The move preceded the coronavirus pandemic by just a few weeks.

“My store closed at the end of February,” she says of Blue Raven Emporium LLC. “My timing could not have been any better.”

O’Dell says she experienced a decrease of in-store sales over the past two years, which contributed to her decision to rely solely on e-commerce. She wasn’t sure her customers would remain after many told her they don’t shop online. But then the city’s stay-at-home order went into effect in late March.

“I’ve still got them,” she says of her customers. “They had to learn how to shop online, and now they realize how convenient and easy it is.”

While declining to disclose her online sales, O’Dell says e-commerce gave her a boost right when she most needed it.

E-commerce has made a significant jump amid the pandemic as consumers conduct business online out of convenience and, at times, necessity.

The most recent data from the Adobe Digital Economy Index notes U.S. e-commerce activity is up 42% through August from the same period in 2019. U.S. consumers spent a total of $63 billion in August, which was down from a May peak of roughly $85 billion. The Adobe Analytics data cited more physical stores becoming available after stay-at-home orders ended as a contributor to the flattening of the numbers. Overall, Americans have spent 14 billion hours, or 1.6 million years, shopping online in the first eight months of the year, according to the data.

Mama Jean’s Natural Foods Market LLC also just preceded the pandemic with its decision to offer online grocery shopping in January. It invested roughly $6,000 for an e-commerce platform from Rochester, N.Y.-based Freshop to allow curbside service, according to past Springfield Business Journal reporting.

“It was really beneficial for us to have the curbside with the e-commerce set up,” Mama Jean’s co-owner Susie Farbin says, noting the service is at its Sunshine Street and Republic Road tores. “We were really lucky to have it in place.”

Farbin told SBJ this summer that online grocery shopping during the stay-at-home order in April generated nearly $144,000, or 9%, of roughly $1.7 million in combined store sales for Mama Jean’s. Store officials say curbside service has added another $292,000 in sales May-October.

Expanding e-commerce is part of the company’s strategic plan for 2021, which store officials say could result in a mobile app.

Farbin and other grocers say the pandemic has changed online grocery shopping habits for the long term.

The view of continued e-commerce activity beyond COVID-19 is reflected in April results from Springfield Business Journal’s 2020 Economic Growth Survey. Over 30% of business respondents expect to be doing more online sales once the pandemic threat has subsided, while nearly 60% believe it will remain the same. Only around 6% expect a post-pandemic decrease.

Bruce Velich, regional sales manager for Springfield fitness equipment manufacturer Stamina Products Inc., says the company’s year-over-year percentage growth of e-commerce sales is “well into the double digits.” He declined to disclose sales figures, but noted the home fitness demand has recorded a significant spike during the pandemic, as people change their exercise routines.

“We weren’t sure but we felt like this had real potential to drive people back into home fitness,” he says. “The demand is still there and we expect a strong holiday season. We plan for this to continue.”

Stamina Products’ equipment line includes exercise bikes, rowers and elliptical machines.

Seasonal sales in the home gym equipment market is frequently strong, as consumers look to exercise indoors during winter and as part of New Year’s resolutions, Velich says. The growth of e-commerce sales in the industry could last for another two or three years, he says, depending on the post-pandemic economy.

But Velich says supply chain issues persist among the company’s distribution base, which includes Walmart, Target and Amazon.

“There are limitations at the source and limitations with logistics coming across the sea and at the port,” he says. “Our lead times have gone from about 90 days to double that – and even longer in some places.”

Stamina Products is one of roughly 200 clients for advertising agency Campaignium LLC, which works in the e-commerce space. Co-owner Jeffrey Paulette says the agency often updates or creates client websites and runs shopping campaigns on Google and Facebook. He estimated nearly 50% of new clients since March request e-commerce help.

“We can track exactly what they’re doing on the sites,” Paulette says of the shopping campaigns. “If they make a purchase, we’re tracking that purchase. We’re looking at the cost per acquisition to make sure it is actually a successful campaign and we’re actually creating revenue for our clients.”

Paulette says businesses are starting to better understand that online sales are here to stay. The pandemic only spotlighted that point, he says.

“As more people start to work from home, there’s just going to be much more emphasis on e-commerce and digital marketing,” he says.

Blue Raven Emporium’s O’Dell says if she remained a brick-and-mortar store throughout the pandemic, it’s highly unlikely she’d still be operating.

“I don’t know how a lot of these small boutiques stay in business,” she says. “Retail space is expensive. To pay for retail space when you don’t have the revenue coming in, I can’t imagine it.”

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