Naming the current recession as the ‘Great Lockdown’ this week, the IMF zeroed in on where much of the hurt is coming from. As much as COVID-19 is first and foremost a health issue, the economic damage is largely being caused by social distancing measures that governments have been compelled to implement.
With restaurants, bars, shops and other physical spaces of commerce forced to close, the one redemptive light of trade has been supplied by e-commerce... in fact in some regions it’s been actively encouraged by local governments. Its ability to persist in the most hostile of conditions has seen it flourish in places that have traditionally been slow to embrace it.
A consumer survey from Nielsen recently revealed the extent to which habits have already changed across Europe. France and Italy, relatively slow historically to adopt online shopping options, are seeing dramatic spikes in uptake.
Of course, e-commerce’s digital DNA does not insulate it from the hurdles the ‘real’ world faces. But if you work in e-commerce or digital marketing, you’ll know how easy it can be to forget the invisible physical infrastructure that sits behind our screens.
We tend to deal in digital abstractions. In lines of code and sheets of data, plugins and platforms, cookies (albeit decreasingly) and conversion rates.
As an affiliate in particular, where your role is focused squarely on engaging consumers online and driving qualified traffic to relevant advertisers, it’s easy to become immersed in this virtual realm.
But with the click of one ‘buy’ button, a customer sets in motion a chain of physical logistics that remain largely hidden to us.
E-commerce’s physical roots provoke delivery dilemmas
The outbreak of COVID-19 across the globe has shed new light on this hidden world. From the factories that manufacture our goods and the warehouse workers who pack them, to the haulage and shipping companies that transport them across land, sea and air, and the couriers and delivery drivers that complete the last mile to our doors.
While e-commerce may represent the equivalent of a lifeboat for many shuttered retailers right now, it is still heavily anchored in this physical world and dependent upon it.
The peculiar nature of COVID-19 therefore means many retailers face an impossible situation at the moment.
The drop in foot traffic to physical stores as a consequence of social distancing means there is an excess of stock building up in warehouses.
Though e-commerce has picked up some of the slack in this respect, as more people shop online it is still overshadowed by the volume of goods that would previously have been bought in stores and which are now piling up in warehouses with nowhere to go. Spanish fashion giant Inditex, the owner of Zara, was just one prominent brand that’s been forced to write off over $300m off its Spring/Summer collection due to the pandemic’s effects on brick-and-mortar shopping.
US-based discount affiliate RetailMeNot has noted in recent research that the number of brands now offering free shipping in their offers is rapidly increasing across several categories as many seek to offload their inventory online.
Simultaneously, the virality of the pandemic has restricted the ability of warehouse workers to prepare these goods for delivery. Whether it be due to contracting the virus itself or a lack of safe working conditions in such environments, many staff are simply unable to do their jobs.
Responding to this dilemma, Dunelm - a UK homeware brand and Awin client - closed down their website, temporarily making it ‘browse-only’ while they reorganized logistics to make it as safe as possible for employees before reopening sections of it gradually to fulfil mounting online orders.
For delivery partners, the crisis has put a pressure on their systems and workers unlike any witnessed before.
Glovo is an Italian logistics startup who enables Carrefour to deliver its supermarket produce to city-based customers within 30-minutes of receiving the order. Since the lockdown was enforced, uptake of the service has increased tenfold.
Even Amazon, a company renowned for its logistical prowess, has been forced to transform its warehousing and fulfilment facilities. Last month it recruited an extra 100,000 new warehouse workers and increased pay for those workers by around $2 an hour. Third-party sellers can no longer rely on Amazon’s fulfilment support either, as it's prioritized shipment for a select group of items it identified as essentials, including medical and household goods.
Collaboration is key to survival for affiliates
For affiliates, the need to understand how this invisible infrastructure functions has never been greater. Ensuring they are directing their valuable traffic to brands that can actually deliver to customers may be the difference between an affiliate business surviving the Great Lockdown or not.
And key to this survival will be collaboration from across businesses and across industry.
Within our own community, one of the most concerted efforts in this direction has been spearheaded by the CSS affiliate RedBrain.
Pulling together a list of delivery couriers its numerous brand partners used and publishing this for peers to view, the company hoped to help fellow affiliates respond nimbly should any of those couriers run into delivery difficulties.
“Right from the outset of the crisis it was clear that a burden would be placed on the distribution networks,” said RedBrain’s Mitch Eccles, who initiated the project. “We thought it prudent to monitor these for any potential disruption and, by sharing this data with the industry, we hoped to provide a collective benefit for everyone.”
Having collated information from merchant sites, as well as inviting other companies to contribute details, RedBrain’s public document now counts almost 400 advertisers and their respective courier partners. Alongside this are latest updates from each courier’s own status pages and another sheet describing any disruption that brands may have had in their ability to deliver to customers.
As well as contributing to RedBrain’s central sheet of information, Awin has attempted to share its own insights and information to better support the industry at this time.
From the already published performance tracker visualization, local business information hubs and crisis initiatives board, to further projects in the pipeline aimed at ensuring our partners are equipped to navigate the crisis.
Such efforts exemplify the affiliate industry’s tight-knit sense of community and, by continuing to provide better transparency around such issues, we all stand a better chance of emerging from the Great Lockdown in good stead.
For more information on COVID-19, please visit our information hub where we bring you the latest news from Awin, as well as links to network insights and useful pointers, alongside wider updates.
