Coronavirus has put a halt on our lives, businesses, and economy. When we talk about its impact specifically on the e-commerce industry, there are different facets to it. According to a survey result, 32% of people are not leaving their houses, and almost 52% of buyers are avoiding crowds. Such extreme social distancing measures have put the stock market in an imbalanced situation.
The impact of the coronavirus and the guidelines from the government with regards to social distancing has changed the shopping behavior of the consumers. Consumers are now purchasing online more rather than the traditional way of offline shopping.
While earlier people were seen in a large number in public stores, things have changed drastically now. With people being scared of going to stores where people are seen in a large number, the demand for online shopping has seen a significant increase. If consumers have the option of buying something online, they were happily buying it.
In this article, the impact of the coronavirus on e-commerce will be addressed.
Increase in Online Shopping
When the government announced a complete lockdown, many stores were in great loss because of the threat of the virus. This made online shopping as one of the safest options for the consumer to fulfill their demands. Many retail stores have also taken their businesses to online platforms in order to sell their stock. According to a survey in America alone, 49 %, online sales increased.
Consumer survey report highlights the shift from offline shopping to online shopping, and this will continue until the uncertain time period. According to a survey of Retail system research, 90% of the buyers are avoiding to shop in stores because of the danger of the coronavirus and 45 % of people adopted online shopping as a safer option for them during this situation.
People are adopting new shopping style; they are giving preference to the cashless transaction as exchanging money can also become one of the ways to spread of the virus. A survey of Bizrate Insights found that there is a rise of 55 % of consumers who admitted that they are ordering online more than what they do before the virus. The number of online consumers is increasing day by day, and it will keep on increasing until the time this COVID-19 is not under control.
An online retailer needs to expand the supply chain
Expanding the supply chain is one of the important concerns that online retailers should look into. COVID-19 first spread in China, the center of global manufacturing, and the source of goods for many online and offline retailers. China is known for its low-cost products, and because of this, the country became the first choice of retailers to import goods at a low cost.
Wayfair Inc., the leading online retailer of furniture, is also facing the same problem because 50% of its merchandise is imported from China. And since China is the center of the corona outbreak, it has become risky to import any goods from China in the coming future.
Many retailers disclosed that they are contacting other non-Chinese suppliers for goods, and are reducing their dependency on one supplier. By building an extensive network, they will have many options in the future. This is going to help them to tackle the adverse situation of the market.
Recession will give strain to the retailer of elective products
Due to COVID-19 and a sinking economy, many people are jobless now, and fear of recession is spreading. Online retailers are also in the fear that their sales will slow down in the upcoming months.
According to a survey, it is found that many retailers predicting their online sales would fall 36%. In a recession, buyers will prioritize what items they will buy. They would prefer food items medicine over clothing and makeup products as this will be the upcoming demand of the customers. It could be a tough time for retailers who sell elective products.
To overcome this problem, they can add some essential products in their selling list. It will help them not only to survive in the market but also to compete effectively.
The burden on e-commerce
Viewing the current situation, it is evident that people will keep on shifting towards online don’t as they don’t want to move out in public places. And safe home delivery services by Amazon, Walmart, Target, etc. is further increasing the popularity of online stores But, the shortage of products, supply chain issues, and potentially declining consumer demand can put pressure on e-commerce growth if the recession comes. This can be seen as a major hurdle for the e-commerce industry.
Amazon is amongst the biggest brands and a top-ranked e-commerce company. It had announced that they would temporarily cease the deliveries of nonessential items to its warehouse because they wanted to focus on the goods of high priority, but now they have decided to sell all products
Amazon’s warehouse is running out of goods, and this is not good news for the retailers who were relying on Amazon. The gap which they have in regulation of their marketplace has been exposed, but Amazon is hiring new employees to control the situation and to perform better in the market.
COVID-19 Disruption led to innovative thinking
As new customers are increasing in the market, there will be a huge expectation for new innovations. The competition will further rise in the e-commerce industry, and businesses that are innovative and customer-centric can be able to survive. So, e-commerce companies should also focus their attention on building new emerging opportunities.
The E-commerce industry is looking forward and re-framing their strategies for post coronavirus as well because this will continue for a long time. They are getting creative on social media and building a transparent relationship with customers which is important for any business not only grow in the market but also survive in the market. While this approach was important before, today it has become the need of the hour.
Coronavirus has a great impact on the e-commerce industry and has created new opportunities as well as new challenges for online business. But it is a great time for an online business to boost up. It is bringing up changes in shopping behavior among the customers and will continue in the future also. Apart from all the challenges that e-commerce is facing during this pandemic crisis, there are many evident opportunities to become more lucrative.