As was reflected in the soaring stock prices for Amazon and other online players, ecommerce boomed as consumers stayed at home and shopped online. But it wasn't only the giants of the internet making gains. Smaller, more nimble players were quick to advance their digitalisation agendas in the wake of the pandemic.
Covid-19 forced many shop doors to shut in 2020, but a handful of "winners" also started to emerge.
E-commerce projects squeezed into 10 monthsThe challenges of the coronavirus pandemic have brought a silver lining for some companies - both new and established. Co-Founder & Chief Executive Officer Chang Wen Lai of Ninja Van, a technology-enabled logistics company, found the surge in home deliveries was good for his six-year old business, while for more established companies, the shift to digitalisation accelerated.
Mahesh Kini, Head of Cash Management for BNP Paribas in Asia Pacific told a recent Greenwich Coalition panel that despite Asia Pacific accounting for around 50% of global e-commerce, it has taken the pandemic to propel clients to move from a process of electronification to rapid digitalisation.
Some businesses saw three-year e-commerce projects compress into 10 months, as stringent curbs on the physical movement of people upended their business model. For companies in sectors such as luxury goods, this hyper-acceleration may emerge as a blessing in disguise.
Younger companies may not have the challenges of legacy technology and consumer behaviour, but the global pandemic still made them rethink some aspects of their business, Ninja Van's Chang Wen Lai said in a live webinar session recently hosted by BNP Paribas in Singapore.
Covid-19 revealed the joys of online shoppingMany have changed their opinions about e-commerce, and companies old and new have had to adapt. With some customers coming online to buy for the first time, they have learned to appreciate the convenience and transparency of the experience.
Chang Wen explained, "People viewed e-commerce as a little more troublesome compared to purchasing goods in a shop, just cheaper. During lockdowns, because consumers had no choice but to buy online, they realised the entire experience was one where it was actually pretty convenient."
Mahesh of BNP Paribas agreed, and added that the speed of adaptation by some companies to the new normal was "surprisingly fast".
"In Asia, the first wave of Covid-19 prompted a strong reaction. By the time waves two and three hit, companies had well and truly evolved. It's really been quite remarkable."
New world, new opportunitiesChang Wen left banking to start Ninja Van in 2014 in Singapore, e-commerce was expanding but deliveries were still archaic. No one was getting their parcels delivered on time, Chang Wen remembers: "It was just a very broken process, and so we took the opportunity to enter the market."
From their early days, Ninja Van focused on being a problem solver rather than aiming to revolutionise logistics with an overly ambitious grand vision. Merging technology with operations, Ninja Van today has 100% coverage across Southeast Asia and employs more than 30,000 employees that help to deliver more than 1.5 million parcels a day.
The Covid-19 boost to e-commerce also came with its challenges and operational difficulties for Ninja Van: "The reality on the ground is that this is a people heavy business," Chang Wen said. "And when our ability to travel, to connect with our local offices and to build that level of trust goes away, you start to see that it's not as easy to operate."
Managing the transitionThe accelerated transition to e-commerce comes with new distribution models and methods, explained Mahesh. "Think about a sector like luxury. Even in 2020, their business model was built around customers coming into the store and buying what they want. In lockdown, the luxury business has to come to the consumer via e-commerce."
Mahesh continued: "Around the second quarter of 2020, we had customers in the luxury segment come to us wanting to implement e-commerce portals and connect new payment channels. They wanted it completed within 30 days – which in most cases we were able to do."
Empowering a digital transformation may mean setting up new distribution models that are better suited to e-commerce, or selecting new digital tools to manage inventory, track deliveries, or to integrate and reconcile electronic payments with Treasury Management Systems (TMS) and Enterprise Resource Planning (ERP) platforms.
Banks are moving fast to help businesses in this transition, added Mahesh, with fintech collaboration key to unlocking timely and transformative digital technologies.
|Ninja Van developed an interlinked set of proprietary systems and processes, including AI-assisted tools, that enable the end-to-end tracking of parcels across every step of the delivery life cycle. That means all parcels are electronically tracked from the moment they are packed to the moment they are delivered. |
Ninja Van's technology is designed to be intuitive, ensuring new hires become efficient with their tools quickly. This enabled the company to grow rapidly to meet significant demand through the lockdowns.