Post-quarantine future: the rise of online sales and digital marketing
What is happening today with sales of children's products, how successful are online sales, how has consumer behavior changed, and what will it become after the quarantine? GfK research data for the first period of the epidemic showed that more than half of the buyers (52%) completely switched to online shopping. Representatives of different segments of the children's goods industry give their prospects, considering whether this purchase share will increase after the quarantine.
Olga Teslya, General Director of Olant Company
– How has the ratio of online/offline sales changed?
Based on revenue, we were 50-50. At the moment, two stores are open in Moscow and one in Vladikavkaz, because these are street retail, and all the rest are located in shopping centers and are closed. In other words, the entire offline segment went down.
Some of the people who worked offline as salespeople have been transferred to the warehouse, some of them will undergo an express training to become online store operators. We need to engage all the available sales staff to provide an additional increase in online sales.
Our online sales have increased by only 10%, although we anticipated a much larger growth. But people have frozen their purchases of expensive goods, and the sales of prams for traveling and children car safety seats have slumped. In any case, we need a safety seat to pick up a baby from a maternity clinic; although before people used to choose safety seats considering their characteristics, now the price is the key issue.
— How long do you think the market will be frozen?
— I think he'll be recovering for a very long time. And there's more to that – the customer behavior will change completely: this situation will teach people to buy online. We'll need flagship offline stores so that the customers could see and touch new products. The era of online commerce is coming, the era of the global development of everything connected with e-mail, with social media. It is clear that even before that online marketing was growing, but in 2020 the share of online marketing tools will probably approach 99%.
(based on materials from VC.ru)
Anastasia Vasilkova, Development Director, Choupette
By mid-April, the online sales intensified and reached the level of April 2019. By late April - early May the customers had adapted to the situation, and maybe they felt a bit more relaxed, or, with the change of the season parents saw that children had grown out of last year's clothes and it was time to change them – and the sales increased dramatically. Both in our online store and at the websites of partner aggregator platforms. Since the end of April, the weekly increase in Internet sales has become about 30%.
We have switched the staff of the offline shops of the Choupette retail chain to a call-center work mode, and now the employees work with online orders and are engaged in updating the customer base.
We also started to produce the product of the moment – protective masks, but we do not sell them, we attach two masks to each Internet purchase as a compliment.
Changing consumer behavior is one of the main challenges.
Offline customers will no longer be the same. They will have higher quality requirements for the goods and services, though the customers' habit of getting omnichannel wow-effects and entertainment will remain unchanged. They'll expect to be more entertained offline, too. And all this is for a lower price.
The second important challenge is to maintain your market niche. We passed it in 2014: when the crisis started, there was an inclination to decrease prices. However, in my opinion, it is important to preserve the spirit of the brand, the reason for the customers' addiction, and at the same time to add something new that will cause their fresh interest. That's why the Choupette brand is now developing niche category collections.
License market: what will happen?
The licensing industry suffers from the consequences of restrictive measures no less than others. Which brands will remain on the market, which licensed products will be purchased in Russia, and what will be the prospects for the industry after the quarantine is lifted?
“The customers have not yet restarted expensive purchases preferring to save money and spend it only for the goods of prime necessity, therefore the growth trend in the FMCG categories is now most noticeable,” – said Valentina Kursanova, Director of Business Development and Licensing 0+ Media. 0+Media is the trademark owner of the brands “Mi-mi-mishki”, “Fairy Patrol”, “Leo and Tig” approaches the applications of their licensees for installment payments flexibly and individually, and also develops proposals for advertising on their resources (television channels, online platforms, publishing projects), and provides support using third-party Internet resources.
The customers who are in a long-term stressful situation have a huge need for positive emotions. This is especially true for the market of children's goods and children's animation licenses, which dominate the Russian market. "The parents reducing consumption today still want to please their children, so only the most necessary items and only their children's favorite products will remain in their basket," – said Julia Bostanova, Managing Director of "Sax Licensing".
"To effectively interact with the customers, the retailers will extensively introduce VR and AR technologies to change the look and feel of familiar products," said Maya Moskvicheva, CEO of Marmelad Media. (RIKI Group), – It is likely that after the epidemic we will find out that contactless payments, artificial intelligence, and voice assistants will play an even more active part in our lives. New licensed products should be developed taking these trends into account".
(«Licence Market Newsletter»)