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Retail & E-commerce

How COVID-19 Has Changed Ecommerce

Written by 
Brad Davis
October 6, 2020

It should come as no shock to anyone that ecommerce has boomed since COVID-19 forced much of the world into lockdowns and other restrictions which have drastically impacted the way we shop.

To give you an idea, here are some baffling statistics about how COVID-19 has changed ecommerce in 2020:

1. At the height of global lockdowns earlier this year, daily ecommerce sales saw a 66% increase on last year’s sales. Even now, online sales are sitting approximately 7% higher worldwide than they were pre-COVID-19 (Nosto: The State of Ecommerce 2020).
2. Throughout March and April 2020, Europe saw a 35% spike in ecommerce mobile app installations (AppsFlyer: The State of Shopping App Marketing 2020).
3. Nearly 90% of global consumers plan to stick with new brands discovered when shopping online during lockdown (Bazaarvoice: Behavior that Sticks).

From a consumer point of view, even those who prefer to shop in-person have been left with no choice but to shop online at some point this year. The evidence suggests that many consumers who were new to ecommerce have now continued to shop online, since growing accustomed to it.

Well-known retailers like Nike already offered a cohesive and convenient online shopping experience long before 2020, and merely needed to shift their marketing focus to emphasise their online channels.

Perhaps this is why Nike’s online sales in Q3 of 2020 were 82% higher than the same period last year.

Other business (like Uniqlo, for example) quickly realised that while their in-store experience was exceptional, their digital shopping experience failed to satisfy customers, many of whom have since turned elsewhere for their clothes and accessories.

One thing has become quite clear – COVID-19 is an ongoing challenge, which means businesses require ongoing solutions to acquire and retain customers. These changes to the way consumers shop, sudden and drastic though they were, are not temporary.

So, with that in mind, let’s get a little more specific about how COVID-19 has changed ecommerce

1. Huge increase in demand for essentials and entertainment

tub full of groceries purchased online
Increasing demands for essentials delivery

It was inevitable that online shopping for industries like fast food, FMCG and entertainment (i.e. books, board games, subscriptions to streaming services and so on) would skyrocket, while industries like travel and hospitality would suffer.

However, that doesn’t mean there hasn’t been some surprises. For instance, who would have thought that sales of sportswear and sporting goods would thrive in a time when everyone is confined to their homes?

This is just one example of many which suggest that consumers have turned to contactless means of shopping for the essentials that allow them to cook, exercise, entertain themselves and continue to live a fulfilling lifestyle.

2. Higher demand from new demographics previously indifferent to ecommerce

It goes without saying that a Gen Z or Millennial is far more likely to engage in online shopping than someone who is in their sixties or seventies.

And yet, there has been a huge increase in consumers aged 65+ shopping via computers and mobile devices since the beginning of this year.

This has forced businesses to rethink various aspects of their online stores, from the way they list products to the way they take payment at checkout, in order to ensure a straightforward ecommerce experience that is accessible for customers of all generations and other demographics.

3. Innovative solutions to “the last mile” problem

man delivering box
"The last mile" problem

In supply chain management and transportation circles, the “last mile” refers to the final step in delivering a product to the consumer.

Whereas getting the product from the manufacturer to the distributor to the retailer might be simple, it’s often the final link in the chain (getting it to the consumer’s doorstep) that poses logistical issues or problematic delays.

However, with such an elevated demand for ecommerce this year, businesses have had no choice but to step up their game when it comes to home delivery.

It’s also worth noting that recent data suggests “convenience” trumps “price” in the ecommerce game. Customers are willing to pay more for peace of mind that a product that will find its way to their door quickly and easily, rather than suffer through delays and confusion in the delivery process.

4. Success depends on long-term thinking, rather than short-term solutions

As I mentioned earlier, COVID-19 has proven to be an ongoing challenge, which requires an ongoing solution.

Despite the uncertainty that’s currently being felt in every industry, it seems the businesses that are investing in digital are faring better than those that are tightening the purse strings and trying to “wait it out”.

While it’s a scary concept to spend money on improving your online store, elevating your digital marketing and enhancing your omnichannel efforts at a time when revenue isn’t pouring in, it may well be the difference between success and failure.

5. Competition is fiercer than ever

ecommerce products on laptop keyboard
Competition among online stores

Now that everyone is scrambling to up their ecommerce game, competition has never been fiercer – regardless of what industry your business is in!

But don’t worry; I didn’t bring this up simply to spread doom and gloom. There are countless ways in which you can bestow your business with an advantage over your competitors.

Arguably, the most effective approach is to offer your customers an enticing digital loyalty program.

Whether your business already has a loyalty program or you are looking to create one from scratch, it’s crucial that you make it compatible with your online store. The idea is to allow customers to accrue loyalty points for all purchases; in-store, online and even transactions made via their mobile device.

In fact, if you’re really serious about retaining customers, you’ll even reward them for other behaviours, such as writing product reviews, referring friends, sharing content on social media and even creating their own content around your product. But that’s a topic for another blog

It’s not just that COVID-19 forced us to turn to ecommerce. It has shown us how convenient and innovative ecommerce can be… when done right.

So, how do you do it right? Here are some tips.

Now that we’ve covered how COVID-19 has changed ecommerce, the takeaway here is to consider your customers’ online journey, and ask yourself how it can be improved and perfected.

This might require redirecting your attention (and your budget) to things like warehousing, delivery staffing, better I.T. support, web design/maintenance, and loyalty marketing.

Considering that existing customers spend two-thirds more than new customers do, customer loyalty has never been more important than it is in 2023.

Rather than fixate on customer acquisition to the detriment of customer retention, consider resources like digital loyalty apps.

Not only can a digital loyalty app create a seamless omnichannel experience for your online shoppers, but it also builds brand loyalty and fosters a stronger emotional connection between your brand and your customers.

Stamp Me Loyalty Solutions specialises in brand loyalty and customer retention. In addition to our award-winning loyalty platform, we will soon be offering a highly interactive digital loyalty app which integrates with Shopify for a seamless ecommerce experience.

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