It’s no secret that the world is facing a serious global health crisis thanks to the coronavirus (COVID-19) outbreak. It has not only become a public health pandemic, but it’s also having a critical impact on global supply chains, and markets worldwide have been on a rollercoaster as a result of what economic impact it may have. As the coronavirus continues to gain traction in the U.S., there has already been considerable changes in consumer behavior. Self and mandatory quarantines, along with emerging consumer worry about public places will provide opportunities for ecommerce businesses to thrive over the next few months, and potentially permanently.
As consumers turn to digital options to avoid physical shopping environments, the change in behavior may impact longer-term habits. For instance, we are all keenly aware of the modern shift in holiday shopping behavior when ecommerce sales rise sharply compared to the rest of the calendar year. It is therefore highly likely that we will see similar shopping patterns possibly lead to a “step-change”, one in which consumers will not return to previous behaviors.
Due to quarantines, ecommerce sales in specific categories like consumer product goods, grocery and staple items, have already seen marked increases, and Amazon Prime has already noted significant increases in membership along with sales within these categories. Grocery delivery is also seeing a boost. In Target’s recent investor call, the company discussed new ways for people to shop with pick-up, drive-up, and delivery in order to cater to their new customer habits. All of which could potentially be the foundation for the ecommerce step-change that the internet promised 20 years ago.
Studies continue to show that consumer behavior is obviously influenced by environmental, economic and sociological factors as well, all three of which are evident with the current COVID-19 crisis.
According to data analysis from Quantum Metric, coronavirus is driving U.S. consumers online. Ecommerce retailers based in the U.S. experienced a 52% growth rate in online spending during the fifth to eighth weeks of 2020 (the time period when the virus began rapidly spreading outside of Asia) compared to the same weeks of 2019. According to Quantum Metric, consumers may have increased their online shopping because their local stores have run out of stock due to delayed shipments, to stockpile items, to avoid busy public places, or simply to take advantage of direct shipping options for bulk purchases. Once consumers have become familiar and comfortable in the ecommerce space, they are likely to continue to make future purchases in this same manner.
Tamara Gaffney, VP of strategy for Quantum Metric posted to her blog, “Without a doubt, the digital retail experiences customers have been having these past few weeks, good or bad, will have a lasting impact on (retailers’) ability to build much-needed loyalty into their consumer-base.”
Consumer habits are hard to change, but when events such as this happen on such a large scale it forces the market to change. This is a change that consumer marketing has been preparing for since the birth of the internet, but it may have just taken a cataclysmic event to actually unleash the true latent potential of ecommerce and it would seem the restraints may have been broken forever by Covid-19.
Branded Online has been building the future of ecommerce infrastructure technology since the company’s inception. We are now leading the world by providing the core operational, marketing, and logistics platform that enables virtual workers to effectively manage all aspects of ecommerce remotely – even in times of pandemic. This has been our mission from day one, and we are fortunate to be a part of what is helping ecommerce deliveries remain operational in the most trying of times.