Why Value For Money Has Become Crucial To The Online Supply Chain Post-Covid

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It seems strange to look back now to the times when news stories were emerging about an illness occurring, initially in China. Few could have predicted that it would become a global pandemic, the like of which hadn’t been experienced for generations. Not only were the effects huge on the world’s health, but they also had huge ramifications on local and global economies, some of which continue today, some four years after COVID-19 first struck.

Another effect that the crisis had was to expose long-standing weaknesses in the supply chain, weaknesses that had remained hidden until they were laid bare by the crisis. A number of factors worked to expose them. These included a sudden demand for certain products. People were suddenly bulk-buying essentials like tinned foods, staples like flour and eggs, not to mention toilet tissue. All around the world, the shelves in stores soon became empty.

Even more significantly, the pharmaceutical industry found itself short of essential drugs and hospitals were struggling to obtain the amounts of personal protection equipment needed to keep staff and patients safe. The net result of this was to leave many sectors and the businesses within them in a parlous financial state. Many went under. And the ones that made it through to the other end of the Covid crisis faced a future in which many things needed to change. One of the first of these was to win back customers, as well as retain existing ones and recruit new ones.

Where value counts

Whether in the B2C or B2B environment, a key driver to recovery is always going to be offering customer value. While this has always been important for business success, it was fully accentuated in the recovery period and remains so today. Some businesses, like Alnatura, the German retailer and organic food manufacturer, have done this by improving their supply chain and introducing the SaaS model. Others have adapted different strategies. For others, there are several different approaches to adding value for money to their offering.

Bonuses and extras

One only has to look at recent success stories in some sectors to see how bonuses can work to offer real value for customers and to adapt to the growing increase in the online sector. A case in point is iGaming, where online casinos offer generous joining bonuses to new players. These include matching their stake money and offering free spins on selected slot games. There are even websites helping players to find the best offers and Casino.org finds bonus codes that unlock them. While this may be a very specific example, the principle of offering an initial incentive to encourage customers is a very effective and visible way to offer value for money.

Offer more for less

Another tried and tested technique for offering value for money is to provide extra for the same price. Since time immemorial, this has been a mainstay of the marketing mix for the FMCG sector. It’s a highly visible and tangible method of offering value for money that can be applied to many different products delivered via the supply chain. Whether presented as an XX% extra free offer or a Buy One Get One Free deal, it’s an undeniably effective method of growing or maintaining market share while giving customers what they want.

Free shipping and returns

Often consumers can move through the online purchasing process, thinking that the price given is the price that they’ll pay. But when they reach the charge for shipping, this suddenly increases. So, a great way to add value to a client or customer is to ensure that there is no charge for delivery and none for returns either. In fact, it’s this that can create a significant difference and competitive advantage over other operators in the same sector.

Sectors that benefited from the pandemic

Of course, looking back to the period when the Covid pandemic was at its peak, there were some sectors and parts of the supply chain that thrived. Some were services, but many involved transporting goods. These included sports equipment for use at home and suppliers of tech, the latter especially driven by the sudden and unexpected need to work from home.

In all of these cases, they thrived because they had effective supply chains in place and anyone looking for best-in-class performance should look to these for lessons.

Four main tenets underpinned their success:

  • Understanding of both their own businesses and the needs of their customers.
  • Effective and well-structured teams that worked together with one common aim.
  • A flexible approach and an ability to adapt as and when needs demand it.
  • Constant monitoring to identify issues in their early stages.

Anyone involved in the supply chain who sticks by these principles and combines them with offering true value for money will be well-placed to face the future. And if another cataclysmic event like Covid ever occurs again, they should be well-prepared to weather the storm.